Different tariffs to increase electricity consumption

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We will increase the use of electric stoves with the slogan (Leave imported gas, connect indigenous electricity), Energy Minister Bhusal

Kathmandu, 17 August 2021. The government is going to implement different electricity consumer tariffs to increase consumption within the country. Speaking at a program organized on the occasion of the 36th anniversary of Nepal Electricity Authority (NEA) on Tuesday, Minister for Energy, Water Resources and Irrigation Pampha Bhusal said that the action plan to increase internal consumption should be implemented effectively considering the situation of wastage of electricity in the coming rainy season.

Bhusal, who is also the chairperson of NEA’s steering committee, said, “In order to increase domestic consumption, it has been decided to fix different electricity tariffs for rainy season and dry season. It is important to reconcile. ‘

Instructing NEA to work with an action plan to complete the goal of fully electrifying the country as early as possible in the next two years, Bhusal requested to support the plan to increase the use of electric stoves with the slogan ‘Let’s leave foreign gas and connect domestic electricity’.

“As a result, foreign capital stays in Nepal for gas purchase. On the other hand, if consumers can consume electricity cheaply, consumption will increase and wasted electricity will be used in the near future and NEA’s income will also increase,” he said. “My priority is to electrify agriculture by installing irrigation feeders on irrigable land that cannot be irrigated from canals and ditches and to provide electricity for irrigation at concessional rates.”

Minister Bhusal said that the construction of Upper Arun 1060 MW, Chainpur Seti 410 MW, Tamakoshi Panchau 100 MW projects will be taken forward with the investment of the people and the Upper Modi 60 MW project will be taken up with the investment of the employees. He said that it was important to build 400 kV transmission lines connecting Butwal-Gorakhpur, Kerung (China) -Ratmate and connecting east-west, north-south without wasting electricity and also to open the door for electricity trade in neighboring countries.

Stating that NEA should work hard to provide quality electricity service to the customers, he said that the work should be expedited to set up a grievance redressal mechanism, upgrade and expand the distribution structure, automate using technology and expand smart meter connection across the country.

Secretary at the Ministry of Energy, Water Resources and Irrigation Devendra Karki said that the construction of the 1061 MW Upper Arun Hydropower Project should be expedited immediately. Stating that the industries could not be provided electricity as per the demand due to lack of transmission and distribution infrastructure, Karki directed NEA to focus on the implementation of the action plan to increase electricity consumption.

Chairman of the Electricity Regulatory Commission, Dilli Bahadur Singh, directed NEA to lead the construction of large projects with semi-reservoir and reservoir-based projects to control leakage, maintain good governance, increase electricity consumption.

NEA Executive Director Kulman Ghising said that excellent service would be provided to the customers by reducing the operating cost through the use of automated system in monitoring, control and management of the system from power generation to distribution. Stating that the distribution system needs to be expanded and strengthened along with the increase in electricity demand and consumption, Ghising informed that such works would also be taken forward with priority. “Market management is challenging for the sale of electricity generated from projects including the Upper Tamakoshi Hydropower Project. Necessary arrangements will be made to consume the produced electricity in the country and sell the surplus electricity in the inland market,” he said.

“Increasing electricity consumption in the country not only consumes the electricity generated but also has a positive impact on the economic and social development of the country,” he said. Actions including raising public awareness will be carried out effectively.
He expressed his commitment to focus all his efforts on building a strong and empowered authority with the aim of providing excellent service to the consumers while maintaining institutional good governance, transparency and accountability.

Krishna Acharya, president of Independent Power Producers’ Association of Nepal (IPPAN), suggested speeding up the construction of transmission lines to implement a comprehensive program to increase electricity consumption.

NEA’s operational achievement

90 percent of the population has access to the grid
As in the past, the number of consumers consuming electricity has also increased last year. Compared to the previous fiscal year, the number of customers has increased by 7.37 percent from 4.22 million to 4.53 million last year. Overall, 90 percent of the country’s population has so far received basic electricity with access to the grid. NEA has succeeded in substantial electrification in 32 districts by FY 2077/78 despite the Corona epidemic. Electricity has also been supplied to Kalikot and Jumla in Karnali from the national transmission system.

NEA’s production decreased, imports from India increased

A.W. In 2077/78, a total of 2.81 billion units of electricity was generated from NEA’s hydropower plants. This is a decrease of 6.96 percent compared to 3.2 billion units in FY 2076/77. While 2.99 billion units of electricity was received from private sector power houses in FY 2076/77, it has increased by 8.36 percent to 3.24 billion units in the last Fiscal Year.

Similarly, A.V. The purchase of 1.73 billion units of electricity from India in 2076/77 has increased the demand for energy and the production of NEA has decreased. In the last fiscal year, 8 billion 870 million units of electricity was made available in the system. This is 14.68 percent more than 7.74 billion units in FY 2076/77. Out of the total available energy, the contribution of NEA power house was 31.66 percent while the contribution of imported and purchased electricity from private sector was 31.83 percent and 36.51 percent respectively. The total electricity consumption in FY 2077/78 is 7.31 billion units. It is increasing by 12 percent as compared to 6.52 billion units in June 2012/13.

Electricity leakage increased

Electricity leakage has been 17.18 percent in FY 2077/78, which is 1.91 percent more than that of FY 76/77. The increase in leakage has been due to the increase in electricity consumption, inability to conduct leakage control program significantly due to COVID-19 and regular meter reading.

Profits declined

A total of Rs. 71.28 billion has been earned from the sale of electricity in FY 2077/78. Which is 6.59 percent less than that of Rs. 76.31 billion in FY 2076/77. In FY 2077/78, NEA’s operating expenditure increased by 10.96 percent to Rs. 68.45 billion as compared to Rs. 61.87 billion in the previous fiscal year. Rs. 41.46 billion has been spent for the purchase of electricity in FY 2077/78. Procurement of FY 2011/12 increased by 18.05 percent over Rs. 35.12 billion.
In FY 2077/78, NEA’s net income, including other income, was Rs. 80.35 billion, while operating expenses were Rs. 68.64 billion and operating profit was Rs. 11.71 billion. This operating profit is Rs. This is a decrease of 50.67 percent compared to Rs. 23.74 billion in 2076/77.
Profit before the last Fiscal Year was Rs. 6 billion which is a decrease of 54.73 percent compared to Rs. 13.27 billion in FY 2076/77. Also A.W. Net profit after tax of Rs. 11.68 billion in FY 2011/12 has decreased by Rs. 3.51 billion or 69.94 percent in the last Fiscal Year.

The share of procurement in the electricity available in the system is 68.34 percent. 58.83 percent of the income earned from the sale of electricity has been spent on electricity purchase. Expenditure on purchase of electricity has increased by 18.05 percent in FY 2077/78 due to decrease in production of NEA and increase in import of electricity as compared to FY 2076/77.