Kathmandu — The Independent Power Producers’ Association, Nepal (IPPAN) has submitted a 38-point memorandum to Minister for Energy, Water Resources and Irrigation Biraj Bhakta Shrestha, urging the government to immediately increase private sector participation in electricity trading and transmission line construction, among other key demands.
The memorandum was presented during a program organized on Monday to congratulate IPPAN’s newly elected executive committee. The event also featured an extensive discussion on the country’s energy sector, where IPPAN proposed policy reforms and implementation measures to address the challenges hindering energy development and expansion.
Speaking at the event, Energy Minister Shrestha emphasized the need to comprehensively assess the energy sector’s contribution to Nepal’s development. He urged stakeholders to adopt a broader perspective of “economic engineering” as a driver of national economic growth.
“The energy sector has made a significant contribution to Nepal’s economic and social development. It is now necessary to analyze its impact in a broader context,” Minister Shrestha said. “The contribution of energy across all sectors should be assessed in an integrated manner.”
The minister said the ministry is taking a collaborative approach to energy development by engaging all stakeholders and stressed the need to form a high-level committee, including representatives from the private sector, with a clear roadmap to address the sector’s challenges.
“Discussions on increasing private sector participation in electricity trading have already progressed significantly. Although substantial funding has been allocated for transmission line construction this fiscal year, it will not be possible to continue expanding the network from next year without attracting private sector investment,” he said.
He further noted that energy developers have been forced to spend more time lobbying at Singha Durbar to resolve policy and implementation bottlenecks than building projects on the ground.
“The ministry is committed to forming a high-level committee with a clear mandate through legal provisions to address these policy and implementation issues,” he said.
The minister also argued that the government and the private sector should jointly establish a committee to develop Nepal’s electricity trading market. He added that the Ministry of Energy has already proposed to the Ministry of Foreign Affairs the appointment of an Energy Attaché at Nepal’s diplomatic mission in India to facilitate cross-border electricity trade.
Minister Shrestha said the ministry is moving forward with plans to transform the proposed Electricity Bill into an umbrella law that comprehensively covers all aspects of the energy sector. He stressed that the current government has no excuse for inaction and is committed to delivering a major leap in the energy sector through policy reforms and effective implementation.
He argued that the private sector should now broaden its focus beyond electricity generation to include power trading, transmission, distribution, market development, and electricity consumption.
“We now need to study integrated trade management and integrated system management and move towards broader, coordinated development,” he said. “The government must identify existing policy gaps, and both the private sector and the government should work together to address them.”
IPPAN Chairman Mohan Kumar Dangi said the private sector is fully prepared to help the government achieve its target of generating 30,000 MW of electricity within the next 10 years, provided the existing challenges facing the energy sector are resolved.
He noted that the 205th meeting of IPPAN’s newly elected executive committee, held on July 3–4, 2026, had issued a 50-point declaration. If the commitments outlined in the declaration are addressed in a timely manner, he said, the private sector is fully committed to supporting the government’s national goals of 30,000 MW of power generation, increased electricity exports, higher domestic consumption, green development, and economic prosperity.
Dangi thanked the government for including several encouraging measures in its policy framework, budget, and 100-point action plan, such as completing pending Power Purchase Agreements (PPAs) within 180 days, allowing PPAs for projects below 10 MW, permitting private sector participation in electricity trading and transmission line development, and determining wheeling charges.
However, he said that several government actions continue to hinder the development of the energy sector. These include the cancellation of project licenses, restrictions on capacity expansion through the Electricity Capacity and Energy Scheduling Procedure, 2026, and the refusal to extend the Required Commercial Operation Date (RCOD) deadlines.
Dangi argued that it is unfair for the government to revoke project licenses on the grounds that developers failed to achieve financial closure within two years when the authorities themselves are aware that delays in PPA approvals by the Nepal Electricity Authority (NEA) and approvals from the Ministry of Forests and Environment have prevented projects from moving forward.
He reiterated that the private sector is ready to work in partnership with the government and called for the formation of a high-level committee to resolve all outstanding issues facing the energy sector.
He also urged the government to immediately resume the IPO and rights share issuances that have remained suspended since May 2023, as well as the share dematerialization (demat) process, which has been halted since January–February 2025. In addition, he requested government intervention to stop the forced implementation of a duplicate ISIN (International Securities Identification Number) system, which he said is inconsistent with existing laws.
Dangi concluded by stating that the private sector will continue to operate in the energy sector in a responsible and professional manner, adding that IPPAN will not protect any member found to be engaged in unethical or improper practices.
Kantipur