‘Investment worth Rs 1 trillion at risk if we fail to sell electricity’

KATHMANDU: The vice-president of the Independent Power Producers’ Association-Nepal (IPPAN), Ashish Garg, has said that investment worth Rs one trillion will be at risk if electricity is not sold to neighboring countries.

He made such a claim at a program titled ‘Energy Trade’ organized by the Society of Economic Journalists – Nepal (SEJON) on Tuesday, stating that Nepal’s current power generation capacity stands at 1,360 megawatts and will reach 6,000 MW within the next three years. He said that investment worth Rs one trillion will be at risk due to wastage of electricity as domestic demand will not increase immediately.

“Due to the current state of power consumption and lack of industrialization to consume more quantum of electricity immediately, the demand for electricity will not reach more than 1,700-1,800 MW in the next three years,” Garg stated.

“There is a possibility of increasing production by at least 1,500 MW a year which is equivalent to 4,500 MW within three years. In that case, 4,000 MW of electricity will be wasted if electricity is not sold then. ” He further claimed that Nepal Electricity Authority has informed that since April,200 MW of electricity has been wasted during the night.

Garg said that when power is wasted, the money invested by banks as loans, investors investing in self-capital and investors investing in shares will sink.

Although the process of constructing cross-border transmission line with China is underway, it will take at least five years for it to be completed even if everything goes as planned. More than 500 kilometers of transmission line has to be built between the two countries which means electricity trade with China will be difficult. Likewise, electricity trade with Bangladesh is also difficult as both the countries need to build a 23-km-long cross-border transmission line using Indian terrain.

“Right now, electricity can be sold in the Indian market on a government-to-government (G2G) modality and there will be no problem in electricity trade with India in the medium and long term,” Garg stated.