Report shows NEA’s losses mounting

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    Nepal Electricity Authority (NEA), incurred an estimated loss of Rs 11.794 billion in fiscal year 2015/2016 due to the imbalance between the electricity purchasing and selling price.

    According to the NEA’s Financial Report, it paid Rs 16.50 billion to India in fiscal year 2015/16 towards electricity import. This is 51.56 percent of the NEA’s total income of Rs 32 billion.

    Overall, NEA paid Rs 24.50 billion in electricity purchase from within and outside the country. Nepal at present imports 315 megawatts power from India. NEA will have to pay more than 70 percent of its total profits to Indian company when it imports approximately 600 megawatts electricity from India next year.

    The report states that NEA’s accumulated loss has touched Rs 36 billion. Moreover, it is also suffering losses due to the electricity leakage which is said to be 25.78 percent.

    It is stated that the NEA will make an additional income of five billion rupees when it raises electricity tariff at 19 percent on the recommendation of the Electricity Tariff Fixation Commission.

    Likewise, the state power utility has Rs 4.896 billion longstanding loans. NEA’s operational expenditure has reached Rs 1.46 billion towards production, Rs 684.3 million towards transmission, Rs 6.267 billion towards distribution and Rs 1.409 billion towards administrative expenses.

    This has put the NEA into financial difficulty. The fact that the accumulated losses of the NEA had reached Rs 36 billion within just four years from Rs 27 billion in 2068 BS has pointed out weakness in its management part.

    Linking the under-construction 1047 megawatt hydropower projects with the national transmission line could reduce loadshedding and help elevate economic status of the NEA, a matter which should be focused, the Energy Minister suggests.

    Source : Karborab