Nepal Infrastructure 
Although three decades have passed since the introduction of the Electricity Act in the country, it has been two decades since the private sector has been involved in hydropower development. After opening the entry of the private sector, now the share of the private sector in electricity production is skyrocketing. Apart from power generation, the private sector is also interested in power trading and construction of transmission lines. However, the government did not give them that role.
Similarly, now all the electricity produced in monsoon is not being consumed and is being wasted. There is a situation in which there is an increase in consumption within the country there is a need to prepare for export as well. Recently, the importance of clean energy is increasing. On the other hand, the Association of Independent Power Producers (IPPAN) is organizing the Power Summit. In this context, Bhim Gautam of Nepal Infrastructure.com had a conversation with IPPAN President Krishna Acharya:
It has been almost 20 years since hydropower production started. It has been a long experience of production. Where are we now?
After the Electricity Act 2049, the private sector has been allowed to enter in electricity generation. Before that, the private sector did not produce electricity. Any businessman is looking for an opportunity. Where to invest depends on how the returns will come. After the Electricity Act 2049, Nepal’s private sector entered thinking water resources have a good opportunity. In the beginning, even making one megawatt was a big thing. In the beginning, friends made one megawatt from two to five megawatts. Friends have been building it gradually, in the history of two decades, now 100 megawatt capacity has been developed. By including national investment and national experts and construction professionals, the power generation capacity of more than 100 megawatts is currently being developed. Now Nepali investors can invest in the upcoming projects that are bigger than that. This is an exciting topic for the private sector.
Where have we reached the public and private sector rather than on a percentage basis?
As for the share of the private sector, today it is about 70 percent. As Tamakoshi is called governmental by the government. However, 65 percent are private sector investors. Rather than competition between the private sector and the government, the government and the private sector are working on their own behalf. If we talk about speed, the speed of the government is like a tortoise, while the private sector is at the speed of a hare. The private sector is making one project after another. Now the private sector is coming with enthusiasm to invest in the hydropower sector. There are 25,000 to 26.000 megawatt projects that have reached various stages. They are in the process of obtaining permission to complete the construction. This is a very big achievement. The government is also doing what it does and what its agencies do. We cannot compare with that. The private sector is coming a long way. Rather than the percentage today, after some time, most of the private sector will have some percentage of the government.
The private sector has leapfrogged in production. Compared to that, in detail, in transmission, in business, the private sector is still weak. Why is it not possible to move forward in those areas? Is it just more emphasis on production?
No, it cannot be said that it is a weakness of the private sector. Why did the private sector not get the opportunity for that? The government opened the door to production. Not pen for trade and distribution. It is still closed. As the production government opened the door. In the same way, if we had opened up the trade and distribution, we would have entered the private sector there as well. Even today we are waiting. For the past 5 years, we have requested the government to open the way for the private sector to do business. Legally, we also registered the company.
After that we also discussed with some companies of India. We have even signed MoUs with some in the presence of the Minister of Energy. But it is not being implemented. The way the government announced in 2075 that the agreement would be to make 10,000 megawatts in 10 years, if it had come with a plan and program on how to consume that 10,000 megawatts, we would not even have used the word that it is a weakness today.
And the other has only one single buyer. There is Electricity Authority to generate and purchase electricity. The rate is same fixed by the Electricity Authority in 2068 till date. It’s been 12 years. He is a single buyer and a single seller. Everything is with him. That’s why there was no competition. If Authority was able to compete, there would have been electricity business that we could not even imagine in the private sector. I think there would have been a big revolution in the economy.
It is said that the government does not have the capital to invest in hydropower. It seems that the public sector does not believe that the private sector will come and agree to a contract for 25 years. Are you not able to explain this topic to public bodies? How do you think the government has been negative with the private sector?
Our government has become a control-oriented government rather than facilitating the private sector. If you look at it as a whole, the tendency of the government in any field is how to control it. Leaders talk about encouraging the private sector when they present their work papers. In practice, there is control everywhere. I have said in many places, a hydropower producer has to run up to 7 ministries. Apart from that, there are many local problems. Why not facilitate this through a single system? If all the problems were to be solved by a single system, it would have been a huge transformation.
Today we are very excited that load shedding has come to an end. That is a big thing. Why had to spend 18 hours of load shedding. Now we have lit the light. Now how much we have been able to consume in industry, irrigation, agriculture, tourism should go towards that. However, some industries have not been able to get electricity till today. Production is consumption. We could not balance. However, an industrialist first plans where to consume his products. Here we have no harmony between production and consumption. It would have been better if production and consumption programs were brought together. If you look at the advertisement in the market, every industry advertises to sell their products. Advertising goes to the consumer’s mind.
Have you ever heard of consuming electricity? Shouldn’t that be done? Who has taken charge? Shouldn’t it? Don’t you have to bring consumption programs? Maybe there is an electric stove in one place. It will not be ok by distributing electric stove only? I have told the incoming minister that a sample project should be made in one ward without gas stoves. The line from the stove to the transmitter should be made well.
We have said that the wiring of the house should be done, it should be made according to the needs of the house. Just like keeping an inverter when there is no electricity, let’s keep a gas stove when there is no electricity. Maybe not 100 percent, but where is a campaign?
Talking about another electric transport, you may remember that the former prime minister came to Singha Darbar by riding an electric bus. He said that now Nepal has entered the electric age.But now where is that? Not only this, a minister increased the customs duty on electric vehicles. And reduced to other luxuries. How will electricity consumption increase with such trends? That’s why we are missing in practice than in language. This is the most frightening problem. If we continue to do this, it will be difficult for us. Also, we are very happy with small things. How happy we are that we brought 4 billion in selling electricity in four months. If you do, it will come.
The present Prime Minister is going to India. Indian goods come to Nepal without any restrictions. In the same way, in order to get access to our electricity, we have to talk about ‘one to one’. By doing that, our electricity balances. If there is a need in India, it can be produced here. Does this mean that we have not been able to talk at the political and diplomatic level? We have to keep that. It can bring a big change in our economy. That’s why we should be serious about our topic.
Let’s talk about Power Summit, Power Summit has been held for a long time in the past for energy consumption and overall development. It continues. What is its purpose? How will it contribute to the development and expansion of the energy sector?
The Power Summit is not something that will happen today. What are the long-term effects of this? You talked about the energy development work, the Power Summit also has a big contribution in some of the work. Representatives from India, Bangladesh, Bhutan and Sri Lanka will come to the Power Summit. We have not been able to explain some things. The summit works towards that. The discussion focuses on how to promote green energy. We think that it will pay off in three or four ways. It is a question of how much hydropower potential Nepal has. Nepal has immense water resources.
SAARC countries are rich in water resources. It will be maintained that it should be used to the maximum. We will talk about B to B with others who came there to invest in electricity.
The third is where the current technology is, where we are reaching, how we can do better by using technology that works with less expense. Fourthly, there is also the matter of GtoG. A representative will come there.
The prime minister will inaugurate it and the minister of energy will conclude it, then high-level officials will be involved in our program, and high-level representatives of those countries will come Investors from those countries know that there is an opportunity here. Overall, it is believed that this power collection will make a significant contribution to the development of green energy ‘clean energy’.
What will change in government bodies after the Power Summit? Do you expect that the summit will contribute to opening doors to the private sector in business and other matters?
This is a great opportunity to explain the truth to everyone. Everyone’s eyes are on it. The Ministry of Energy is also taking IPPAN. What they are doing may be less. It can be said what will happen. First of all, we are going to do such a big event. This will communicate a message to them. Secondly, it also creates pressure. It can also be a matter of realizing that this topic is important. It can show that this should not happen anymore.
The fourth thing is that we energy entrepreneurs are also excited. We have done something and there is still more to do. We entrepreneurs will also gain more knowledge by listening to the energy experts of other countries and having double talks with them. Therefore, I think that after this summit, it will play an important role in energy development in the long term, not immediately.
