NEA posted loss of Rs 4.56b in 2012/13

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    KATHMANDU, Aug 17:

    NEA_BuldingThe Nepal Electricity Authority has failed to make profit for the sixth year in a row-but has nearly halved its loss following the tariff hike last August. The state-run power utility recorded a net loss of Rs 4.56 billion in the fiscal year 2012/13.

    The net loss stood at Rs 8.55 billion in 2011/2012 and Rs 6.51 billion 2010/11. It may be noted here that the accumulated loss amount of Rs 27 billion was written off by the government a year ago.

    Presenting the NEA´s financial report at 28th anniversary on Saturday, NEA´s Managing Director Rameshwar Yadav said that the annual loss came down due to an increment in tariff revenue by 22.5 percent, which was mainly contributed by hike in tariff rates by 20 percent and a decrease in the energy leakage by 1.34 percent to 25.3.

    The NEA has earned Rs 26.2 billion in total and the expense went up by 12.46 percent in the fiscal year as the energy purchase volume increased while the Nepali currency weakened against the dollar. It posted a total expense of Rs 25.07 billion in the year. And the total power purchase expense amounted to Rs 13.49 billion, which accounted for 53.82 percent of the total operating expense.

    The yearly review report, released on Saturday stated that a large amount of the sum is spend in the maintenance and rehabilitation of its generating stations to increase electricity availability and reliability. However, the report has not mentioned the amount spent for the purpose.

    The NEA is blamed for being inefficient to control the leakage as well as to recover the outstanding dues, which shot up to RS 7.94 billion, which is equivalent to sales revenue of 110 days.

    Of total receivables, street light dues from different municipalities of the three consecutive years alone amounted to Rs 1.85 billion.

    FDI for storage type projects: Energy Secretary
    Speaking at the program, Energy Secretary Bishwa Prakash Pandit, who is also a NEA board member, said that the country needs FDI for storage type projects as the NEA and the state do not have enough resources for the same.
    “We need a long-term plan to reduce and omit the load-shedding hours by attracting FDI by devising the congenial FDI policy for storage projects,” added Pandit.
    “It´s not wise merely to talk of the Power Purchase Agreement in the dollar or the Nepali currency. We should rather have an appropriate FDI policy for PPA like that of Kabeli Hydropower Project,” added Pandit.
    He said that PPA in a mixed model of 55 percent in dollar, and the payment in dollar only will be effective for the time being. He asked the NEA to do groundwork for such large projects, and added that the Ministry of Energy will push such projects.
    Pandit also said that the ministry will evaluate the performance of Managing Director Yadav soon. “It does not suit a person to be in the management who can not deliver,” Pandit told the gathering.
    Yadav was appointed as the MD on a contract basis with the provision of submitting the performance report in every three months. The overstaffing and the poor management have riddled the power utility.
    Pandit further said, “All those over 10,000 employees are to work for the organization instead of leaving everything on the NEA board.”
    Furthermore, he stressed on the need for transparency in the NEA, as he also hinted at initiating the process to purchase the needed transformers soon.
    The NEA employees´ unions urged the government to resume the process of buying the transformers for they were required for the smooth supply of electricity across the country.
    After a transformer scam was revealed in December last year the process of transformer purchase remain stalled.
    Commission for the Investigation of Abuse of Authority has arrested a dozen employees on transformer scam.

    Source : Republica