Electricity tariffs to be slashed for industrial users


    Apr 11, 2019

    Nepal is poised to produce surplus energy from the next fiscal year, and the Nepal Electricity Authority has started work to revise electricity tariffs in a bid to encourage industrial utilisation of the increased output. The power utility plans to offer electricity at a discount to factories when power demand goes down, particularly during night time hours, authority officials said.

    The Nepal Electricity Regulatory Commission will set the tariff and implement it, said Kul Man Ghising, managing director of the state-owned power utility, but the government is yet to appoint its office bearers. The commission was established as a powerful body to oversee the country’s energy sector and fix tariffs. Parliament passed legislation setting up the commission more than a year ago, but it remains immobilised due to lack of officials.

    As per current tariffs, the government charges Rs 8.50 per unit for average household energy consumption of 31 to 50 units. Industrial tariffs have been set in line with the voltage required-Rs7.50, Rs 8.60 and Rs 7.80 per unit-for high, medium and low voltages respectively for rural and domestic industries.

    The move to revise the tariff follows expectations that electricity generation will exceed demand during the monsoon season after the completion of a number of projects including the 456 MW Upper Tamakoshi Hydropower Project in Dolakha. “As we need to manage the excess energy, a change in the tariff structure is the best option to encourage industries to utilise power during the nighttime hours at a concessional rate,” he said.

    Nepal’s electricity output is slated to double in the next fiscal year 2019-20 when another 983 MW will be fed into the national grid, the Energy Ministry said. The expected increase in energy generation is almost equal to the current maximum annual production of 1,027 MW.

    The country’s electricity requirement totals 1,200 MW, and with a bevy of power plants poised to churn out more than 2,200 MW from next year, the bad old days of load-shedding will be permanently gone, according to analysts.

    Energy Secretary Dinesh Kumar Ghimire recently told the parliamentary Finance Committee that 23 projects, including the 456 MW Upper Tamakoshi, were on track to come into operation by the next fiscal year and produce 983 MW. The Upper Tamakoshi is expected to come online by November and will fulfil Nepal’s energy requirement during the dry season.

    This fiscal year, 18 privately funded hydropower projects are scheduled to roar into life. According to the ministry, 287 MW will be added to the national grid by this fiscal year ending mid-July. This energy will come from the 60 MW Upper Trishuli 3A, 14 MW Kulekhani-3 and 22 MW Bagmati Hydroelectric and other projects. Three plants have already entered the testing phase.

    Apart from the electricity authority’s plan to curb surplus electricity spillage, Nepal and India have also recently agreed to set up an energy banking mechanism under which Nepal can send surplus electricity to India.

    Prahlad Rijal

    Source: The Kathmandu Post