Kathmandu — The Independent Power Producers’ Association, Nepal (IPPAN), has stated that the announcement to remove the ‘Take and Pay’ provision in electricity purchase agreements (PPAs) by the Parliament is a significant achievement.
Holding a press conference in Kathmandu, IPPAN announced on Thursday that it has suspended its ongoing protest, stating that the government has adopted an energy-friendly policy.
IPPAN Senior Vice President Mohan Dangi stated that the removal of the ‘Take and Pay’ PPA provision announced in the budget by the Parliament is a positive development. Although the budget had initially proposed implementing the ‘Take and Pay’ PPA model, it has now been revised to allow PPAs only for those projects whose energy consumption and export are assured based on financial risk assessment, and for which the Nepal Electricity Authority is capable of ensuring payment obligations.
Dangi stated that with the removal of the ‘Take and Pay’ PPA provision, PPAs for projects up to 10 megawatts—which were previously regular but halted after the announcement—will now resume. According to the notice issued by the Nepal Electricity Authority, additional PPAs will be carried out, and based on the Energy Development Roadmap 2081 endorsed by the Council of Ministers, PPAs will be opened up, creating an environment where the private sector can invest with confidence. He added that it is also the responsibility of the private sector to help achieve the government’s target of consuming 13,500 megawatts domestically and exporting 15,000 megawatts of electricity over the next ten years.
“The announcement to remove the ‘Take and Pay’ PPA provision was made as a result of IPPAN’s first phase of civil protest—carried out through continuous advocacy, meetings, memorandums, dialogues, and alerts—with the support and cooperation of the media and journalists, policymakers, representatives of various political parties, and others,” stated the press release issued by IPPAN.
Source Kantipur
