Kathmandu, December 7

Nepal will continue to face power cuts during winter even after addition of around 820 megawatts of electricity in the next two to three years, Nepal Electricity Authority (NEA), the state-owned power utility company, said today.

Nepal currently generates around 762 MW of hydroelectricity. But during winter, power generation capacity dips by more than half because most of the hydro projects in operation are run-of-the-river.

Run-of-the-river hydro projects generate electricity whenever there is water in the river. So, as soon as water level dips, electricity production from these projects falls.

This problem is expected to become even worse this winter because several hydro plants that were damaged during earthquakes of April and May have reduced power generation by 80 MW.

“So, we expect hydro plants to generate only around 327 MW of electricity this winter,” NEA Deputy Managing Director Sher Singh Bhat told an interaction organised here by the National Business Initiative.

The only way to solve this problem, according to Bhat, is rapid construction of reservoir-type hydro projects, which can collect water during rainy season and use it to generate electricity during winter. But the country only generates 92 MW of electricity from reservoir-type projects at present.

“In this regard, we must focus on meeting at least 40 per cent of the electricity demand of peak hours through storage-type hydro projects. If we can do this, there’ll be drastic reduction in loadshedding hours,” said Bhat. Peak electricity demand currently stands at around 1,500 MW.

But meeting this target in the next few years is almost impossible because most of hydro projects under construction are also run-of-the-river.

“Several projects that are expected to start commercial operation within two to three years are expected to add 821 MW of electricity to the national grid,” Bhat said. But these projects are run-of-the-river, whose electricity production would fall to around 215 MW during winter.

“So, loadshedding hours will continue to go up during coming winters as well,” Bhat said.

Although rivers in Nepal are said to have adequate capacity to generate 42,000 MW of electricity, power cuts here prolong for over 12 hours per day during winter because of halt in construction of big hydro projects since the mid-1990s.

“Due to dispute over Arun 3 hydro project, the country was able to generate only 30 MW of electricity from 1985 to 1997,” said Khadga Bahadur Bisht, president of the Independent Power Producers’ Association, Nepal. “And over the years, the government has failed to introduce appropriate Acts and policies to give a lift to the hydroelectric sector, while politicians have failed to fulfil their commitments to develop the hydro sector.”

Also, NEA, the country’s sole buyer of electricity, has become virtually defunct due to heavy political intervention and the Commission for Investigation of Abuse of Authority has lately started to ‘interfere in the hydro sector by annulling projects in a haphazard manner’, Bisht added.

“But the latest supply disruption has become an eye-opener and many have suddenly become aware of importance of hydro projects,” Bisht said. “So, this is the time to implement reforms and shorten various administrative processes to rapidly start construction of hydro plants.”

Currently, a hydro project developer has to make rounds of seven ministries and 23 government departments, and deal with 36 different laws prior to beginning construction of hydro projects.

“So, we request the government to form a powerful single authorisation desk, comprising officials of various ministries, departments and NEA. This desk should extend approvals on environmental protection and land acquisition, among others, within stipulated time,” Bisht added.

The government should pave the way for development of bigger hydro projects because the country’s petroleum imports bill is swelling every year due to growing demand for fuel to power generators, while water from rivers is going to waste, said Amrit M Nakarmi, coordinator, Energy Systems Planning and Analysis, the Centre for Energy Studies, Tribhuvan University.

Within 2008 to 2010, sales of diesel doubled from 300,000 kilolitres to 600,000 kl, and currently stand at 900,000 kl because many started resorting to generators to produce electricity following hike in loadshedding hours. Also, sales of liquefied petroleum gas have shot up lately because most of the households prefer to use this fuel to cook food.

“A study conducted in 2014 showed that the country could reduce its petroleum imports bill by Rs 50 billion per year, considering use of Rs 25 billion worth of fuel to fire up generators and another Rs 25 billion worth of fuel to cook food,” said Nakarmi.

To replace consumption of LPG and diesel required to power up generators with hydroelectricity, additional 1,300 MW of hydroelectricity must be generated, according to Nakarmi.

“To generate this quantum of electricity, investment of Rs 210 billion is required. This investment would help the country save Rs one trillion over the next 20 years,” Nakarmi added.