Loss of Rs 64 m for BPC

    277

    KATHMANDU, July 31

    Butwal Power Company (BPC) suffered a loss of Rs 64 million in the last fiscal year following loss from both electricity generation and distribution. The company, with investment of both the government and commoners, now is dependent solely on the dividend received from Khimti Hydropower Project.

    Dividend for investors from BPC will also fall due to the loss. BPC had received Rs 350 million in dividend from Khimti in the fiscal year 2069/70. It is also likely to receive similar amount in the last fiscal year from Khimti where BPC has share investment of 17 percent. BPC had earned Rs 243.90 million in the fiscal year 2069/70 which was 49.6 percent less than Rs 483.50 million earned in the preceding year.

    Andhikhola Hydroproject has been shut down for one and half years to increase its installed capacity. Chief Executive Officer (CEO) of BPC Uttam Kumar Shrestha stated that the company is in loss while procuring electricity from the Nepal Electricity Authority (NEA) and distributing to Syangja and other areas after shutdown of Andhikhola. He added that dividend will be determined only after completion of audit report. Shrestha explained that the business of generation also has gone into loss as income generated from Jhimruk is spent on distribution of electricity after shutdown of Andhikhola. BPC had proposed to the Electricity Tariff Fixation Commission (ETFC) to raise tariff by up to 163 percent last year stating that its distribution business is making loss of around Rs 70 million a year.

    BPC and NEA meanwhile have not been able to sign power purchase agreements (PPA) after that for Jhimruk and Andhikhola projects operated by BPC expired last July. BPC has not been able to receive full payment for sale of electricity in lack of PPA. NEA and BPC had signed PPA on July 13, 2001.  BPC has demanded Rs 6.20 per unit during dry season and Rs 4.80 during rainy season and the duo has yet to agree on the rate for PPA. “ETFC has not raised tariff. We have not even received income from sale of electricity in lack of PPA for one year and are, therefore, facing problems even in operating the company,” Shrestha said.  NEA has been paying just a small amount to BPC for office operation in the interim.

    BPC had been operating 12.5 MW Jhimruk and 5.1 MW Andhikhola projects and is preparing to upgrade Andhikhola to 9.4 MW. Shrestha revealed that Andhikhola will resume operation only after mid-October. BPC has been distributing electricity to 39,621 households of Pyuthan, Arghakhanchi, Rolpa, Syangja and Palpa districts directly through its transmission line. It had been selling 5.50 million units to NEA from Jhimruk and 3 million units from Andhikhola every year.

    PPA between NEA and BPC has been stalled due to PPA done in US dollar for Khimti but the recent NEA board meeting has revoked the decision taken while Chief Secretary Lila Mani Poudel was NEA chairman. PPA has been stalled as the 650th board meeting of NEA had decided to ban the promoters of Khimti (60 MW) Himal Power Limited from investing on other projects if they do not agree to review the PPA done in dollar and bear the royalty to be paid to the government. Fifty percent stake of Khimti is being transferred to NEA from July, 2020 according to agreement. The current PPA will also finish after that. The dividends BPC receive from Himal will also fall massively after that. BPC will not be in a position to provide dividends to shareholders after 2020 if it does not develop new projects and only depend on Himal.

    The government had sold 70 percent stake of BPC to Shangrila Energy for Rs 960 million. Shangrila has 68.95 percent stake in BPC, commoners 10 percent, government 9.9, Intercast Nepal 6, United Mission to Nepal 2.79, staffers 2 and NEA 1.

    Source : Karobar Daily