The objection arises due to the continuity provided in response to the economic changes made by cutting the facilities provided by Electricity Act 049.

The Independent Power Producers’ Association Nepal (IPPAN) has expressed its dissatisfaction over the permission granted by the Government of Nepal for the hydroelectric project, which mandates continuous operation and license validity during the budget year 081/82 BS ( 2024-2025). IPPAN, during a press conference held to officially announce its stance on the upcoming fiscal year’s budget, stated that they do not accept the ongoing economic changes initiated by cutting the facilities provided by Electricity Act 049 (1992).

For over a year, IPPAN has been raising concerns on every platform about the flood-affected projects, insisting that even though they are affected by floods, they should be allowed to import goods at a concessional rate of one percent as relief. IPPAN’s President Ganesh Karki criticized the government for not listening to their demand during a conference. He stated that projects importing goods at one percent should be fully compensated, as per the provisions of Electricity Act 049 (1992). Otherwise, the hydroelectric projects severely affected by floods would be unable to procure spare parts and may have to shut down operations, he added.

The Senior Vice President of IPPAN, Mohankumar Dangi, has informed that the flood-affected hydroelectric projects have not requested any additional facilities from the government. According to Electricity Act 049(1912), by issuing a specific-term license, when projects come into operation, all facilities are gradually cut off. He expressed concern that if all facilities are cut off, investors will withdraw from investing in Nepal’s energy sector. He stated that they have demanded the right to utilize the facilities provided in the license without asking for any sympathy from the government.

Due to physical and human damages caused by floods, IPPAN’s Secretary General, Balaram Khatiwada, expressed deep sorrow that issues related to compensation and relief were not included in the budget despite assurances from the Prime Minister during inspections of affected projects. The Ministry of Energy, Water Resources, and Irrigation plans to sell electricity between Nepal and India in long-term for 10 years, energy, hydro sources, and irrigation. According to the national commission’s five-year plan, by 2035, a total of 28,000 megawatts and national planning commission are planning to produce 8,000 megawatts within the next five years.

Former Chairman of IPPAN, Krishna Prasad Acharya, stated that despite the private sector’s strong demand to be included in the budget for electricity trade, there was no mention of it. He highlighted that even though the government is aware of the procedural complexities in energy project construction, it needs to simplify these processes. Acharya expressed concern that organizations under the Ministry of Forests and Water Resources, responsible for watershed conservation areas, face the most challenges in hydroelectric project construction. He emphasized that achieving the target of generating 28,500 megawatts would be difficult under current circumstances.

Source: kantipur