Minister for Energy, Water Resources and Irrigation, Kulman Ghising, has stated that the 10% minimum cap for solar energy, as stipulated in the energy mix policy, will be removed. He made this remark on Sunday while talking to a delegation led by Kushal Gurung, President of the Renewable Energy Confederation of Nepal (RECON), which had come to submit a memorandum with various demands.

“There is no longer a 10% cap on solar energy in the energy mix,” President Gurung quoted Minister Ghising as saying, “Produce as much renewable energy, including solar, as possible-the government will manage everything.”

RECON had urged the minister to reconsider the cap imposed on solar energy in the energy mix and had demanded facilitation for the development of renewable energy sources including solar, wind, and small hydroelectric projects.

The delegation also submitted a memorandum containing demands for a short-term (90-day) and long-term action plan and discussed key issues that need to be included in such plans. Former RECON President Gunraj Dhakal and other officials were also present during the meeting.

RECON has also sent a copy of the memorandum to the Alternative Energy Promotion Centre (AEPC) for reference.

To Honorable Kulman Ghising

Minister for Energy, Water Resources and Irrigation

Nepal has committed to achieving net-zero emissions by 2045 and is determined to implement its ambitious climate commitments under its Nationally Determined Contributions (NDC) and Long-Term Low Carbon Development Strategy.

The Renewable Energy Confederation of Nepal (RECON) represents over 500 private companies and organizations engaged in sectors such as small hydropower, biogas, biomass, solar energy, wind energy, and waste-to-energy.

We offer heartfelt condolences to those who lost their lives during the recent Gen-Z-led protests on Bhadra 23-24. We extend our deepest sympathy to the bereaved families and wish a speedy recovery to the injured. This tragic human and physical loss calls for deep national introspection.

Meanwhile, we extend our heartfelt congratulations to you on your appointment as the Minister for Energy, Water Resources, and Irrigation in the interim government. RECON is committed to working closely with you in building a sustainable, inclusive, and resilient renewable energy system during your tenure.

Key Policy Demands

Policy and Regulatory Reform

Fast implementation of the Renewable Energy and Energy Efficiency Act, 2080; ensure effective representation of the private sector in the Electricity Regulatory Commission.

Institutionalize net metering, decentralized generation, small hydropower, and rooftop solar within the national energy policy.

Promote Public-Private Partnership (PPP) in projects such as small hydropower, biogas, solar farms, biomass/waste-to-energy, and wind energy, with a focus on Gen-Z employment at the local level.

Green Finance and Investment

Direct concessional loans to renewable energy projects through implementation of Green Finance Taxonomy 2023/24.

Expand mechanisms like green bonds, blended finance, and carbon markets to mitigate investment risk.

Ensure tax and customs exemptions, and preferential interest rates for renewable technologies.

Prioritize "Made in Nepal-Make in Nepal": establish local manufacturing/assembly of renewable energy parts and equipment, generating employment for Gen-Z.

Provide renewable energy industries (e.g. briquettes/pellets) with electricity at concessional irrigation rates.

Technology Promotion and Diversification

Rapid expansion of micro/mini-hydro, solar PV/thermal, biogas, wind, biomass briquettes/pellets, improved cookstoves, and EV charging infrastructure.

Quickly connect completed/ongoing small hydro projects to the national grid via PPP.

Prioritize decentralized generation and mini-grids in remote areas.

Promote R&D and innovation through partnerships with universities (e.g., TU-Ricast, KU) and international allies.

Set a target to increase renewable share in energy mix to 25%, with corresponding incentives.

Assign distinct HS codes for renewable energy machinery and parts (e.g., stoves, burners, chippers, dryers) to ensure import clarity and uniformity.

Provide at least 20 years of income tax exemption to renewable energy industries.

Inclusive and Local Development

Empower local governments as local energy authorities, from planning to production and distribution.

Ensure meaningful participation of women, youth, Gen-Z, and marginalized communities in employment, ownership, and entrepreneurship.

Conduct energy needs assessments and capacity development programs at provincial/local levels.

Guarantee community participation in production, transmission, and distribution; strongly link energy access to household and small enterprise development.

International Cooperation and Carbon Market

Ensure full benefits from Article 6 ITMO and Voluntary Carbon Market (VCM); prioritize inclusive participation and benefits for women, youth, and marginalized groups.

Develop and operate a national carbon registry and exchange system.

Strengthen technology transfer and climate finance collaboration with partners like India, China, EU, GCF, IRENA, GGGI, PFAN, etc.

Immediate Action Plan (90 Days)

Policy/Institutional

Form a Joint Renewable Energy Taskforce including the Ministry, AEPC, NEA, and RECON to accelerate pipeline projects.

Restructure the Electricity Regulatory Commission to ensure transparent regulation and private sector participation.

Pass and implement carbon trading regulations (linked to Article 6/VCM).

Launch Nepal Carbon Market Roadmap in line with NDC 3.0 and prepare for ITMO implementation.

Investment/Finance

Direct Nepal Rastra Bank and commercial banks to create dedicated concessional loan lines and interest subsidy/guarantee mechanisms for RE developers and SMEs.

Launch a private sector concessional loan program for rooftop solar on industrial/commercial/government buildings with production-based incentives.

Production/Infrastructure

Fast-track Rooftop Solar Acceleration Program: single-window permits, standard PPA/net-metering contracts, and quality technical standards.

Promote battery storage projects (new or repurposed EV batteries), supported by Viability Gap Funding (VGF), B2G models, and time-of-use tariff models.

Implement solar thermal program per newly published roadmap, targeting LPG/traditional energy replacement.

Support local manufacturing of renewable parts/equipment with tax/customs benefits and land/infrastructure packages.

Regional Implementation

Terai/Tar: Solar irrigation through both grid-PPA and net-metering models.

Hills/Mountains: Integrate small hydro with battery storage and irrigation.

Incentivize industrial/commercial/government rooftops through interest subsidies and production-based incentives; promote suitable renewable technologies in rural areas.

Ensure local government autonomy with clear legal/regulatory provisions and authority for energy production, transmission, and distribution.

Launch "Industry-Ready Power" program for reliable supply to industries, with qualifying user frameworks and refined time-of-use tariffs.

Link local entrepreneurship to RE projects via municipalities/rural municipalities, with capacity-building programs focused on Gen-Z.

Finally,

Honorable Minister, under your leadership, Nepal has a golden opportunity to realize the Decade of Renewable Energy (2075-2085). RECON remains a reliable partner in creating legal ease, mobilizing private investment, and rapidly scaling up renewable solutions - helping to reduce fuel imports, enhance energy security, and fulfill climate commitments.

Kushal Gurung

President

Renewable Energy