DoED scrapped Licences of 611 MW hydro projects

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    Department of Electricity Development (DOED)KATHMANDU: In a bid to discourage the trend of occupying rivers after obtaining licence of hydro projects‚ the Department of Electricity Development has started scrapping the licences of hydro projects. DoED has cancelled licences of at least 14 projects (total capacity 611MW) in the last 11 days for failing to submit the necessary progress reports and not paying the renewal fee. Three of these projects had already applied for generation licences.DoED’s information Officer Gokarna Raj Pantha said they had followed due process of seeking clarification‚ engaged in repeated correspondence and issued 35-day public notice in newspapers asking licence-holders to appear at the DoED and complete renewal in time. Some other projects will also be facing the same action‚ he added. The DoED issues survey licence to developers for two years. After that the latter must renew the licence every year till a total of five years and then apply for generation licence together with valid survey licence. However‚ it was found that licence-holders intended to linger on with the project‚ rather than work. “The new renewal fee implemented from October 1 made it easier to stick to the decision‚” added Pantha. Survey licence holders have to submit the progress report of feasibility study‚ Environmental Impact Assessment and connection agreement from time to time during the survey period. Project developers have to furnish Environmental Impact Assessment/Initial Environmental Examination report‚ connection agreement or Power Purchase Agreement‚ Letter of Intent of Financial Closure and feasibility study reports for obtaining generation licence. By amending the Electricity Regulations in October the government increased the annual renewal fee up to 20 times by categorising according to capacity. The annual renewal fee for 1-5 MW projects was made Rs 1 million from Rs 50‚000. The renewal fee for 5-10 MW project was made Rs 2 million‚ 10-25 MW – Rs 3 million‚ 25-100 MW – Rs 4 million‚ 100-500 MW – Rs 5 million and above 500 MW – Rs 6 million.Pantha argued they had increased the renewal fee as the previous fee structure was very low and it prompted licence holders to occupy river‚ rather than develop the project. This trend also discouraged genuine developers by keeping them away. Former Energy Secretary Surya Nath Upadhayaya said licences were distributed wrongly without assessing the capacity and intention of applicants. He was of the view that all the projects should be awarded only after open competition to whoever would construct the projects at the lowest rate.

    Source : The Himalayan Times