April 4, 2020
The Nepal Electricity Authority (NEA) has earned a profit of Rs 10.67 billion in the fiscal year 2018/19. According to the Nepal Financial Reporting Standards (NFRS), the organization has earned the profit including Rs 855 million in comprehensive income. According to the final audit done by the Office of the Auditor General, the NEA has earned profit of Rs 9.81 billion in the FY 2018/19. NEA has now become the highest profit-making organization amongst the public organizations in operation. However, the cumulative loss of the NEA now stands at Rs 12.23 billion.
The authority in its 34th annual general meeting had projected the profit of Rs 7.20 billion for the FY 2018/19. In the FY 2017/18, NEA had earned a profit of Rs 2.84 billion whereas its cumulative loss stood at Rs 23.59 billion. In the FY 2015/2016, the authority’s net loss was Rs 8.89 billion contributing to the cumulative loss of Rs 34.61 billion and in FY 2016/2017, the cumulative loss was Rs 28.17 billion. The NEA had secured net profit of Rs 1.46 billion and Rs 2.84 billion in the FY 2016/17 and FY 2017/18, respectively.
Kulman Ghising, managing director of NEA contributed control in power leakage, import from India, decrease in the average rate of power purchased from private sector producers, control in the maintenance and administration expense, increase in electricity consumption after the end of load shedding, increase in the production of electricity from NEA run hydro projects, and effective implementation of restructured finance for NEA’s profit for three consecutive years.
The power leakage in the FY 2015/16 was 25.78% which has come down to 15.32% in the FY 2018/19. Ghising in the beginning of his appointment had presented three major commitments like ending load-shedding, making NEA a profit-making organization and making Nepal self-reliant on power.
“The whole team is working to lead NEA into a journey of profit and we have received help from all concerned,” he said, “We are moving ahead with clear plans to make the organization disciplined, able, expand the electricity service and provide the consumer with quality, reliable service.”
The slump in the power leakage has had positive impact on the earnings of NEA from the electricity sold. According to NEA, it makes around Rs 700 million by curbing 1% power leakage. NEA has purchased electricity worth Rs 38.89 billion while it has earned Rs 66.61 billion by selling electricity in the FY 2018/19. In the FY 2017/18, NEA had earned Rs 55.35 billion by selling electricity whereas it had invested Rs 34.13 billion. The authority has paid Rs 1.50 billion as royalty to the government.
Stating that preparations are underway to transform the organization into digital system, Ghising said there will be a massive cut in the operation expenses eventually and it will have a positive impact in the authority’s financial aspect.
Source: My Republica