Deputy Prime Minister and Finance Minister Bishnu Paudel has said that efforts should be made to increase the morale of energy producers.
Newly appointed Deputy Prime Minister and Minister of Finance Paudel said in a meeting with the officials of the Independent Power Producers Association, Nepal (IPPAN) that power producers should be encouraged as Nepal has not reached the point where electricity has now reached.
In a meeting held at the Ministry of Finance at Singhdarbar on Sunday, Deputy Prime Minister and Minister of Finance Paudel said that now Nepal is importing and exporting electricity, as more electricity is needed to increase per capita electricity consumption, he promised to work to increase the morale of private sector energy producers.
During the meeting, IPPAN President Ganesh Karki said that the contribution of the private sector in Nepal’s energy sector has been significant. He said that 182 projects worth 2,500 megawatts have been completed from the private sector, which has been producing energy for two and a half decades, 137 projects worth 3,900 megawatts are under construction and 136 projects worth 3,900 megawatts are awaiting financial management through a power purchase agreement (PPA) with the Nepal Electricity Authority. The statistics were presented to Finance Minister Paudel.
Karki also said that 80 percent of the 10,700 megawatt projects that applied to the Power Development Department for construction after completing the survey and 10,000 megawatts that applied to the Authority for PPA after obtaining a construction permit are proceeding under the leadership of the private sector.
At a time when the private sector is moving aggressively in the energy development of Nepal, the financial policy announced by the Nepal government last May and the monetary policy announced by the Nepal Rastra Bank last Friday did not encourage the entire private sector involved in energy development. Mohan Kumar Dangi requested Finance Minister Paudel.
The meeting was attended by President Ganesh Karki, Senior Vice President Mohan Kumar Dangi, Vice Presidents Ananda Chaudhary and Uttam Bhlon, Deputy Secretary General Prakash Dulal and Working Committee members Uttar Kumar Shrestha and Bharat Parajuli from IPPAN.
These are the demands made by Ippan
1. In the Electricity Act 2049, it is mentioned that only one percent duty will be levied when importing goods/equipment for the maintenance of power projects, and the provision mentioned in the budget up to the financial year 2079/080 has been removed from the previous financial year, so the provision of only one percent duty in the Electricity Act should be maintained.
2. Energy projects with a capital of more than two billion should be listed in the foreign securities market by making arrangements to approve the issuance of shares and rights shares of the projects permitted by the Electricity Regulatory Commission.
3. As the debt of power projects is of long-term nature and the income of energy projects is based on fixed sales price, the expenses of the project should also be fundamentally stable. However, as the interest rates of banks and financial institutions are unstable, the cost of energy projects increases and the projects are becoming more expensive.
4. Since the flood that occurred on June 14 and June 15 of last year washed away more than 31 projects, and the recent flood damaged 40 projects, including Khani Khola Hydro, as a relief and compensation for those projects, 1 percent customs duty should be arranged on the machinery equipment to be repaired.
5. Since insurance companies are reluctant to insure Hydropower projects in recent times, arrangements should be made to insure all Hydropower projects in an easy way.
