NEA cuts import costs by switching suppliers

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    Apr 5, 2017- The Nepal Electricity Authority (NEA) was able to buy energy at a cheaper rate this fiscal year compared to before.

    The state-owned power utility imported energy worth Rs14 billion in the last fiscal year while imports are estimated to total Rs15 billion by year-end.

    As per the authority’s projection, import costs will climb around 7 percent. At the same time, electricity imports from India are projected to go up almost 14 percent.

    The NEA imported 1.73 billion units of electricity in fiscal 2015-16 while it will be importing 1.97 billion units in fiscal 2016-17. Its import and cost projections are based on the statistics of the first eight months of the current fiscal year.

    According to Managing Director Kulman Ghising, the NEA was able to achieve these savings by cutting down on imports of high-priced energy and buying a greater quantity of cheaper power.

    “Our priority is to increase imports via direct trade deals with the central government rather than with state governments as the per unit rate is lower,” said Ghising, speaking at an interaction programme organised by the NEA on Tuesday. “And this became possible after we started importing electricity via the Dhalkebar-Muzaffarpur cross-border transmission line.”

    The NEA began importing 80 MW through the Dhalkebar-Muzaffarpur in February 2016, and imports swelled to as much as 145 MW following a direct trade deal with NTPC Vidyut Vyapar Nigam (NVVN), an electricity trading corporation controlled by the Indian central government.

    The cost of the electricity imported over the Dhalkebar-Muzaffarpur line stands at IRs3.60 per unit. However, the electricity imported through other cross-border transmission lines is purchased from entities controlled by state governments and costs much more, or well above IRs5.50 per unit.

    With increased imports and improved domestic production, the NEA’s supply is projected to rise to 6 billion units from 5 billion units during the last fiscal year.

    As a result, NEA’s revenues are expected to jump 37.5 percent to Rs44 billion from

    Rs32 billion during the last fiscal year, according to its projection.

    Power utility to manage excess energy

    KATHMANDU: Nepal Electricity Authority (NEA), the state-owned power utility, has started laying the groundwork to manage excess energy during the rainy season once the 456MW Upper Tamakoshi Hydropower Project goes online in July 2018. The NEA, according to its Chief Kulman Ghising, is planning to boost household electricity consumption by improving the distribution system.

    On several occasions, the power utility has failed to provide power supply despite having adequate stock of electricity due to lack of a proper distribution system. But hike in household consumption alone may not be enough to soak up excess electricity during the wet season. “So, chances of energy spill during the night time are high,” said Ghising. “To address this problem, we need to export energy to India during the night time for at least six months a year.”  (PR)

    Source: The Kathmandu Post