Nepali Times Asian Paints
Electric future


Anyone who looks at the figures should be worried. Nepal produces only 600MW of power and demand is 800MW. Since most projects are non-storage type, generation capacity depends on the flow of the rivers. Even in the monsoon, the rivers generate only 692 MW, and with energy demand rising at 80 MW a year, power rationing is here to stay for at least three more years. In fact, there may only be power for three hours a day in coming winters. Load-shedding is no just a nuisance to consumers, the fall in productivity and increase in diesel imports is ruining the economy.

The government has declared an energy emergency up to December 2015 during which period it hopes to fast track projects to generate 2,500 MW of additional power, including from reservoir projects. Parliament's Committee on Natural Resources, of which I am a member, has just completed a detailed study and has made some recommendations in a preliminary report.

At present, hydropower development is stymied by inadequate incentives for domestic and foreign investors, poor governance at the regulating agencies and line ministry. Politicisation of the NEA has now reached unprecedented levels: there are 13 unions affiliated to various parties in the NEA. Even if there is enough generation capacity, there isn't the transmission capacity to take the power to consumers. NEA's monopoly in generation, transmission and distribution has hindered competition and hampered efficiency. Some projects are being delayed because their environmental impact assessment isn't complete.

The preliminary report makes the following recommendations:
• Draw up a 50-year National Energy Security Plan and a medium term National Energy Plan within 12 months
l Forge a national consensus among political parties about a five-year National Hydropower Development Plan.
• Urgently draw up a data base of survey licenses for various projects
• Set up an all-party mechanism to remove obstacles for completion of projects undertaken by NEA, domestic private sector and foreign investors
• Launch construction of West Seti, Budi Gandaki reservoir project with new company and line up financing
• Provide government security and prevent strikes and shutdowns at power generation sites
• Address demand side issues like cutting pilferage and instituting institute time-of-day and seasonal tariff
• Expedite 10 projects of up to 25MW, for immediate relief from power cuts, fast track Upper Tama Kosi
• Make special request to five of Nepal's partner countries to build a project of more than 100 MW each
• Repair and operate 59MW of thermal capacity in Biratnagar, Duhabi and Hetauda
• Set aside 7 per cent of the budget for the next ten years for hydropower development, secure financing from international creditors
• Set up a National Transmission Company and draw up a grid masterplan
• Set up a National Power Trading Company
• Priority should be to meet base load before exporting power

The rate demand for energy is growing and hydro power is not able to keep up, thus increasing this country's dependence on imported fuel. Nepal's future development is only possible with hydropower, and the development of other renewables will help us attain self-sufficiency in energy. Each development zone should have a reservoir project to meet demand during the dry season. Energy from the cost-effective investment in hydropower should be invested in industry and processing should spur rural development.

Multi-purpose projects must provide irrigation to boost agriculture production. Most important all, given the importance of hydropower for the country's development, there is an urgent need for political consensus and continuity to future development of this sector. We have lost a lot of time, we cannot afford any more delays.

Gagan Thapa is a NC member of parliament's Committee on National Resources and has been involved with the draft report on water resources development.

Read also:
The urgency of the energy emergency, EDITORIAL
"Things will change"
Keep power politics out of power policy, SAROJ DAHAL
Power cuts here to stay into the 2020s unless corruption and politicisation are checked

1. Arthur
The most important development is not even mentioned.">World Bank $100 million project for 1GW transmission line for urgent import of 100 MW thermal from India to reduce load shedding and future hydro power exports to India (and Bangladesh).

This is sensible but directly opposite to the "priority" for meeting base load before exporting power.

Not mentioning it means the author is simply ignorant about what is actually happening.


3. sukha
dig.. dig...till u make a great hole... and leave the country black...
or... just leave the matters to the technocrats... and support them.
i agree with @arthur... one who doesnot know a thing...tries to preach...

4. foreigner
set prorities,you cannot do all at the same time. What comes first? Put all your energy on 1-2 projects only, private investment for others.

5. rabindra bhandari

for any development(national/internation dekhi ghar,small ,medium to big multinational company)we need energy,at the moment we all are trying to fulfill our immediate priorities arather than long term future,that is why we are buying,inverter,generator,etc rather tahn pushing our government to find other cheaper alternative,which in our case is hydro,as we all know our rivers ahve high current as our river flows from very high altitude,some of comments our brothers have point out was,others also had the master plan before & implementation os such plan is needed not just plan,yes sir youa re right about it,but its our(citizen) responsibilities to ensure that our politician or leaders are doing their job properly,we must remmember because of our ignorant behaviour these leaders are behaving taht way,if we all have one voice than our country will be different,we need to stop critising each other and focus on main goal......river/lake/ etc(electricity,good irrigation system) and tourism is where we can make money for our country apart from or tomorrow ...we must do why not start from today?....

6. Jens
Finally a breath of fresh air from a Nepali politician! He has a practical plan that is the only way forward realistic unless some greedy Maoist or elderly political has-been from theNC or UML tries to spoil it. just hand over the country to Gagan Thapa and Gorakna Bista and people like them.

7. shred

Arthur - whats your problem, you are very keen to throw comments with all links. Whats wrong with the link provided and whats wrong with the policy makers decision above? U must be cheap diplomat for sure!

Reason - if there is only transmission line, whats it use for - if there is no potential future growth?

Second - country knows the power problem - but even bigger problem is its dirty politics, where cheap diplomats like you know how to manipulate from one end to other

Third - take it in grant by 100%, the country is in right path! Everything will be settledown in right order and the diplomat like you will run away from this country!

8. zombie4nepal
Gagan Thapa lost his potential by (1) marrying daughter of one of the worst and corrupt politicians of all time, Crook Nursingh KC (2) attending Indian university, which means he will always be a loyal servant to Lainchaur.

No mentions of the big conspiracy to send all electricity to India with that World (Screwing) Bank funded project? No acknowledgment of what Gokarna Bista has started and how NEA should be allowed to go after everyone who owes it money! His first recommendation has 'national consensus' in it. We all know how well it works in Nepal. 

By the way, do you know if the newly appointed ambassador of your favorite country has approved the consensus prime minister of your other country?

9. Arthur
Shred #7, I said that the World Bank project at the link I provided is "sensible". You seem to have misunderstood that I implied there was something wrong with it.

What's wrong with the article is that it should have mentioned this project, as I said.

10. Arthur
Since I described the World Bank project as "sensible" (twice) I will mention a couple of secondary problems in the Project Appraisal Document (PAD):

1. A major part of the project is providing an initial 400 kV backbone transmission for Nepal with a segment running for 240km parallel to the East-West highway. This is designed to minimize costs by sharing a 46m wide Right of Way with existing 132 kV line. (PAD table A2.3 p45)

That could possibly be a mistake in the long term. The separation between transmission lines forming part of a national backbone should preferably be more than the span width (400m) so that failures are completely independent (eg an aircraft hitting one line cannot drag it across the other to bring both down together as has happened in the USA).

 The decision to avoid the extra cost may be entirely correct. But, if so, the report should mention that this issue was considered and the cost and benefits of postponing complete failure independence were evaluated and found to justify the present design.

2. The PAD is a very valuable resource for background information on Nepal's present and future power situation. It is likely to be relied on by people who want to really understand the issues (not just superficially like this article). A major lack of understanding in Nepal is the specific value of large damn storage hydropower for meeting peak period demand. Details of the wholesale market prices in India depending on season and time of day both now and projected for the future should be in the report to help people understand the real value of exports. The difference between peak prices and baseload is really enormous. If decision makers in Nepal do not understand this they will be ripped off by India.

3. Although unrelated to transmission grid planning, the irrigation and flood control benefits of large storage damns that India should also be willing to pay for in addition to paying the full value of peak period electricity generation should also be understood and could usefully be at least mentioned in the PAD.

11. shred

Arthur - members involved in this projects are not bright like you, they were changed like cap of a bottle eg. writer of this article. He may be vanished or shine tomorrow. So, they are either not informed or the person who needs to inform them does not even know about the your link

Whatever you are reading, do all people read? You are from West. You go to facts and figure, as per your comment, US examples. Nepal is a very very small country - no resource at all, all depend to donor country like your one. As a result, you provide donation in the name of AID and more than two third flows back to your own country providing all necessary/relevant things. You got the executive decison. Now, you may say, why not? Yes, you are right, why not. You send all people relevant to this project to Nepal - I doubt very much, most of the people are just recent UNI graduates. They do not have any experience at all. In return with high salary and Maharaja life style during their stay in Nepal (not only in Nepal - all 3rd world country where it is happening now). After completing the projects - if you do the cost/benifit/efficiency analysis, it wont cross even the half of the bar. So, better not to give US or any other developed nations example. You have to change the context where the project has to be implemented, here the case is Nepal.

(11 JAN 2013 - 17 JAN 2013)