NEA’s annual profits to exceed Rs 15 billion

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The authority recorded a profit of over Rs 12 billion in the first six months of the current fiscal year

KATHMANDU, Feb 20: Nepal Electricity Authority (NEA) has earned a profit of Rs. 12.12 billion in the first six months of the current Fiscal Year- FY 2021/22.

According to NEA’s financial statement (unaudited), the profit was Rs 6.18 billion in the last fiscal year 2020/21. In the first six months of the current fiscal year, the profit has increased to Rs. 12.12 billion.

With this, the NEA has become the most profitable institution among the public enterprises. NEA, which had an annual deficit of Rs 8.89 billion in FY 2015/16, has been in profit since the days afterward. However, a significant decline in profit was recorded last year.

NEA Managing Director Kulman Ghising said that the organization has been able to earn significant profits in the first six months of the current fiscal year due to the control of electricity leakage, increase in electricity export to India, decrease in electricity import, increase in electricity sales and increase in other incomes.

MD Ghising said that the reduction in operating costs, steps taken for administrative and financial reforms, and the fact that the 456-megawatt Upper Tamakoshi Hydropower purchase rate was slightly cheaper than other private sector projects also contributed to the increase in profits.

“Consumer tariff adjustments have been made with effect from mid-December, which may affect profits as revenue declines slightly for the rest of the current fiscal year, but we are working to make leakage control more effective and tighten financial discipline to cross profits beyond Rs 15 billion,” Ghising said.

NEA has earned Rs 47.98 billion and spent Rs 35.86 billion in the first six months of the current fiscal year. The main income and expenditure of NEA is sale and purchase of electricity, respectively. NEA’s long-term financial liabilities to foreign donors have reached Rs 114 billion. The long-term loan of the Government of Nepal is Rs 81.81 billion while the long-term liability of the employees is Rs 36.84 billion.

NEA’s capital assets are worth Rs 165 billion, assets to be capitalized are Rs 152 billion, investment in subsidiaries is Rs 35.34 billion and loan investment is Rs 32.50 billion while liquid capital is Rs 85.10 billion.