DoED collects Rs 2.54b in royalty from power producers

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    Department of Electricity Development (DOED)KATHMANDU, March 24:The Department of Electricity Development (DoED) collected Rs 2.54 billion in royalty from power producers in fiscal year 2011/12, including due royalty amount of Rs 1.66 billion.

    Of the total amount collected last fiscal year, Rs 880 million was received from power producers as royalty for fiscal year 2011/12. The amount is short of 1.15-billion-rupee target set for the year.

    “We are yet to collect Rs 270 million from power producers as royalty of last fiscal year,” Gokarna Raj Pantha, a senior DoED engineer, told Republica.

    Of the due amount, Rs 140 million has to be paid by Nepal Electricity Authority (NEA), while Rs 130 million needs to be collected from private power producers.

    “State-owned NEA has not paid due amount citing financial problems,” Pantha said. “However, it has cleared previous dues.”

    One of the jobs of the DoED is to collect royalty from power producers.

    Half of the royalty collected from power producers goes to respective district development committee. “The remaining 50 percent goes to state coffers,” Pantha said.
    However, independent power producers have claimed that the royalty distribution mechanism was not transparent.

    “There is a problem in DoED´s royalty distribution mechanism,” an official of the Independent Power Producers´ Association Nepal (IPPAN) said on condition of anonymity.

    Pantha, however, said such claims were baseless.

    “I don´t think anything like that is happening,” he said. “A team of officials from three different ministries, namely, the Ministry of Local Development, the Ministry of Energy and the Ministry of Finance, takes decision on distribution of royalty.”

    According to regulations on local governance, the government needs to send 12 percent of the hydropower royalty to DDCs that house power plants. Another 38 percent of the royalty should go to development regions where power plants are located.

    However, the IPPAN has said the royalty distribution process was slow and inefficient. “This angers locals,” the IPPAN official said.

    Source : Republica