The government has addressed the long-standing demand raised by private hydropower promoters through the amendment of the Electricity Act.

Through the ‘Some Nepal Act Amendment,’ according to the amendment made to the Electricity Act, 2049 (1992), the permission period for electricity project surveys can now be extended up to a maximum of 7 years under special circumstances.

Private sector promoters, including the Independent Power Producers’ Association, Nepal (IPPAN), have repeatedly demanded an extension of the survey permit period. However, although IPPAN lobbied for an extension of the validity period for all types of permits related to electricity projects, the government has, for now, only arranged to extend the period for survey permits.

This amendment has provided relief to about three dozen projects that were located inside protected areas and were unable to proceed with surveys due to floods and landslides. According to IPPAN, this amendment has facilitated projects totaling around one thousand megawatts. As a result, approximately 300 billion rupees worth of investment from the private sector has been relieved.

The government has made the initial phase activities of electricity projects more flexible by amending the Electricity Act, 2049 (1992). From now on, the validity period of the permit issued for project surveys can be extended up to a maximum of 7 years under special circumstances.

“Previously, the law provided that the survey license period would be initially granted for one year, and then it could be extended for a maximum of 5 years. Now, after the amendment, the total duration can be maintained for up to a maximum of 7 years.”

According to the amended act, it is clearly stated in Section 5 of the Electricity Act, 2049, that “disasters, general strikes, curfews, or other such extraordinary situations beyond control” which hinder the timely completion of survey work shall be considered special circumstances. In such cases, upon confirmation from the relevant government authority, the survey license period can be extended by up to an additional two years.

According to this provision, projects that have already obtained a license and used the maximum period of five years will also receive an additional two years if they have experienced special circumstances.

According to the Ministry of Energy, this provision has been made in response to the demands of private and government promoters involved in electricity production. Recently, problems such as the inability to complete survey work on time have arisen due to the COVID-19 pandemic, prolonged strikes, local obstructions, legal procedures, geographical difficulties, and disasters.

Keeping this in mind, the government has adopted a policy to introduce flexibility through the amendment of the Electricity Act. According to the Ministry of Energy, Water Resources, and Irrigation, this has been done to provide project promoters with a clear timeline and assurance of security.

Recently, the government has adopted a policy to attract investment in the energy sector and to facilitate transmission and production projects. The amendment of the Electricity Act is also part of that strategy.

Ganesh Karki, the president of IPPAN, stated that this provision will make things easier, especially since the survey license period has expired due to the inability to work on projects located in forest areas.

“We had also requested an extension of time for other permits, and adding time for surveys is also a positive step,” said President Karki. He further stated that this will make things easier for many investors as well.

Now, if there is a delay in the survey work of any project due to external reasons, promoters can apply for an extension of the permit period. The concerned authority can collect evidence and make the necessary decision.

Source: Biznessnews