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Electricity leakage in the distribution system of Nepal Electricity Authority (NEA) rose to 10.44 percent in the last Fiscal Year (FY), signifying the authority’s inability to improve its efficiency in electricity supply.

As per the records with the NEA, such leakage stood at 10.39 percent in the previous FY. It shows that despite achieving notable progress on expansion of electricity sales and distribution infrastructure, the NEA has failed to improve in controlling distribution leakage rate.

In the review period, the NEA sold 12.376 billion units of electricity, an increase of 9.64 percent. Overall, the NEA wasted 1.44 billion units of electricity in the distribution system in one year.

According to the NEA, the average income received from the sale of electricity for distribution was Rs 9.69 per unit in FY 2025/26. Given the rate, the wasted income of the NEA out of the electricity leakage stood at around Rs 14 billion.

In the review period, the NEA was found to have achieved a major expansion in the distribution infrastructure. It built additional 192.52 circuit kilometers of 33 kV; 1,164.76 circuit kilometers of 11 kV and 6,699.77 circuit kilometers of 0.4/0.23 kV lines. Likewise, a total of 7,323 distribution transformers were added, marking an increment of 916.19 MVA in the total capacity of transformers across the country.

Similarly, 10 new 33/11 kV substations were also brought into operation in the distribution system. Despite installation of new transmission lines, transformers and substations, the energy leakage from the system inclined up instead of going down.

In the review period, the revenue received from the sale of electricity reached Rs 119.88 billion, an incline of 9.76 percent. Meanwhile, electricity consumption per capita also increased from 394.69 units to 418.31 units.

According to the NEA, its distribution-related operating and maintenance costs during the period however decreased from Rs 1.74 to Rs 1.06 per unit. While this indicates an improvement in the operational efficiency of the distribution system, there has been no corresponding improvement in leakage.