There are indications that the government is going to take a tough stance on the dedicated and trunk line electricity dispute, which has persisted for eight years. On Thursday, Prime Minister Pushpa Kamal Dahal directed the Ministry of Energy, Water Resources, and Irrigation to recover Rs 20 billion in arrears from the users of dedicated and trunk lines.

During a review meeting at the Office of the Prime Minister and Council of Ministers, Prime Minister Dahal instructed the energy ministry officials to disconnect the lines of those who do not pay the dues for dedicated and trunk lines. “Let's immediately disconnect the lines of non-payers of dedicated and trunk lines,” Dahal instructed the Ministry of Energy officials.

Disputes between the Nepal Electricity Authority (NEA) and industrialists have been ongoing for eight years regarding dedicated and trunk line issues. After the NEA issued notices to cut the lines, the work was halted when representatives from the private sector, including the Federation of Nepalese Chambers of Commerce & Industry (FNCCI) and Confederation of Nepalese Industries (CNI), sought the attention of PM Dahal.

Industrialists have stated that they will not pay the tariff for electricity not consumed, while the NEA has consistently pressured them to pay the electricity tariff.

In mid-September, after the NEA published a notice to recover Rs 20 billion in arrears from dedicated and trunk lines, industrialists and businessmen met PM Dahal to draw his attention. The industrialists appealed to PM Dahal after the NEA issued a notice, warning that they would cut the electricity lines if tariffs were not paid.

Following a meeting with a delegation led by FNCCI's Chandra Prasad Dhakal, PM Dahal telephoned NEA Managing Director Kulman Ghising, instructing him not to cut the lines.

Recently, PM Dahal himself indicated a tougher stance by giving instructions to cut the lines. “In the past, we stopped because PM Dahal instructed us not to cut the lines,” said a senior NEA official, “If the Prime Minister is adamant, we will cut the lines and collect the arrears.”

In cases where load shedding is maintained for six hours or more, it has been decided that the electricity tariff for customers receiving continuous power supply from a separate trunk line for 20 hours or more will be fixed at the same rate as dedicated customers.

According to the NEA, about Rs 20 billion in dues from 67 industrial customers remain unpaid. The dedicated and trunk line dispute dates back to 2015, during load shedding, the NEA decided to provide electricity to industrialists and businessmen by charging a premium fee (additional fee) in July 2015.

The dispute arose in 2018 when the NEA billed 67 industrialists for paying premium fees for using dedicated and trunk lines since 2015. The dispute remains unresolved, with industrialists stating that the NEA is pressuring them to pay tariffs arbitrarily.

The NEA alleged that it has acted contrary to its policy decision, the Electricity Tariff Collection Regulations 2073, and the decision of the NEA Board of Directors. Industrialists argued that they are willing to pay tariffs based on electricity consumption using Time of the Day (TOD) metering.

Industrialists alleged that the NEA unilaterally sent the bills. Pashupati Murarka, the former president of FNCCI, stated that they are ready to pay if the NEA provides proof that the industry has consumed excess electricity during load shedding.

Despite the NEA declaring free load shedding in 2018, the industry was billed under the dedicated and trunk lines until mid-July 2020. Although the Electricity Tariff Determination Commission has the right to determine electricity tariffs, the NEA determined the tariff on June 27, 2015. However, the commission fixed the fee only on January 13, 2016.