Hydropower Producer Wins Big in Dispute with Nepal Electricity Authority

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Mountain Energy Nepal Limited (MEN) successfully defended itself in a legal battle against the Nepal Electricity Authority (NEA) in the High Court of Patan. The NEA had sought to overturn an arbitration decision favoring Mountain Energy regarding disputes in their Power Purchase Agreement (PPA).

The arbitration had previously resolved issues concerning the rates for electricity purchase and sale and deductions for reduced electricity production due to operational inefficiencies in a small hydropower project.

The court ruled in favor of Mountain Energy, led by Justices Lekhnath Paudel and Krishnaram Koirala, who found the NEA’s claims insufficient. As a result, Mountain Energy received approximately Rs. 26 crore 41 lakhs from the NEA and now has the opportunity to claim additional deducted amounts and interest.

The initial dispute arose from the NEA’s failure to build necessary infrastructure on time, delaying Mountain Energy’s project, and discrepancies in payment rates across different years of operation.

 

Source: Share Sansar