No PPA in US dollar for the time being: Energy Minister

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    KATHMANDU, June 24:

    Course dollar increaseMinister for Energy (MoE) Radha Gyawali has said Nepal Electricity Authority (NEA) has stopped signing power purchase agreement (PPA) in US dollar.

    Speaking at the meeting of Public Accounts Committee (PAC) in Kathmandu on Tuesday, Gyawali said the decision was taken after NEA incurred huge loss due to such decisions made in the past and also because of the lack of proper study on the impact of such agreements.

    “We can think about signing PPA in US dollar only after conducting a detailed study on the issue,” said Gyawali. 

    PAC has started discussion on why NEA signed PPA in foreign currency without assessing its impact.

    NEA has signed PPA in US dollar with six projects including the Bhotekoshi and Khimti hydropower projects.

    Energy Secretary Rajendra Kishor Kshatri said there is lack of proper study on modality to sign PPA with power developers, especially those having foreign investment. “We need to conduct detailed study on the pros and cons of signing PPA in foreign currency,” he said, adding that the energy ministry has commissioned a study to sort out the problem. “It is natural for developers to propose for PPA in US dollar as Nepali currency is devaluating and also because they have to bring most of the construction materials and equipment from abroad.”

    Speaking at the meeting, Mohan Bahadur Basnet of Nepali Congress asked the government to review PPA with Bhotekoshi and Khimti as the agreements have inflicted huge loss on NEA. “About two-thirds of NEA´s total loss of Rs 29 billion in the last 15 years was because of the PPA signed with those two projects,” he added.

    As per the PPA signed with Khimti and Bhotekoshi, NEA will have to pay all taxes, including VAT, for those two projects. According to experts, the provision is gainst the norms of universal taxation policy. 

    Another lawmaker Prem Bahadur Singh urged the government to utilize all unspent budget in hydropower projects. Similarly, Dhanaraj Gurung of Nepali Congress said the government should make big investment in hydropower projects to check outflow of funds from the country to buy petroleum products and generators

    Source : Republica

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    Govt mulls over revising PPA in USD

    KATHMANDU, June 24:

    Energy Minister Radha Gyawali on Tuesday said the government has launched a diplomatic initiation with the Norwegian Embassy to revise Power Purchase Agreement (PPA) of Bhote Koshi and Khimti Hydropower Project.

    Minister Gyawali said so in an interaction program organized in the capital to dwell on whether it is right to go for PPA or not.

    According to Energy Secretary Rajendra Kumar Chhetri, it is necessary to study in depth on whether it is right to purchase power in foreign rate or not before reaching conclusion. Similarly, NC lawmaker Mohan Bahadur Basnet also urged to revise Bhote Koshi and Khimti Hydropower agreement.

    Another NC lawmaker Dhan Raj Gurung said a large amount of money has gone out while purchasing generator and diesel. He further said the NEA will bear a huge loss unless PPA is revised.

    Source : Republica