Nepal | July 04, 2020

World Bank stresses on need for country to reform power sector

Himalayan News Service
Share Now:

Hydropower reformKathmandu, October 5

As the country wants to generate 10,000 megawatts of electricity in the next 10 years against only 300 megawatts added in the past 10 years, the government should focus on various reforms to realise investment amounting to tens of billions of dollars in the hydropower sector, according to a World Bank report titled ‘Powering Recovery’.

The report has identified some critical areas like strategic planning for generation and sales optimisation, improvement of the regulatory framework including competition in the power market, improvement of investment environment and restructuring of Nepal Electricity Authority (NEA) — the single power offtaker of the country.

Since 2001, the government has introduced five strategic plans for the development of energy sector.  But the plans have not been implemented due to lack of proper reforms that are required to lure investment for the development of the sector.

Very recently, the ‘National Energy Crisis Prevention and Electricity Development Decade, 2016’, which was unveiled by the Ministry of Energy (MoE), has envisaged to generate 10,000 megawatts of electricity within a decade.

But according to the World Bank report, radical reforms are necessary in the energy sector so that this strategic plan does not face the challenges that hindered implementation of previous plans.

“Attracting and retaining investment that amounts to tens of billions of dollars requires mechanisms for sharing risks, the provision of common infrastructure such as transmission corridors and roads and streamlined procedures within the context of a clear and strong legal and regulatory framework,” says the report.

To move towards higher growth trajectory, power is critical to expand economic activities in the country, according to the report. The rampant power outage in the past decade has crippled the manufacturing sector and also affected other sectors.

The report has stressed on clean, reliable and affordable electricity — the single most important source for recovery and longer-term growth of Nepal.

“Electricity sector could not only meet the domestic demand reliably, affordably, and cleanly, but would earn revenue from export of surplus hydropower through enhanced regional electricity markets to neighbouring countries by integrating the wider South Asia power market,” the report has stated.

Growth of the power sector itself is weak as it has been lagging behind due to various hurdles. Between 2002 and 2016, NEA produced only five megawatts of electricity every year and Independent Power Producers added 25 megawatts per year. Along with generation, transmission and distribution systems are also facing similar problems. Delay in installing transmission lines and lack of proper upgradation of the distribution system to the major load centres may cause perennial problem of power outage in the long run, the report has warned.

“To overcome all the challenges hindering development of electricity, the country needs radical reforms in the power sector,” stressed Damir Cosic, senior country economist of the World Bank in Nepal.


A version of this article appears in print on October 06, 2016 of The Himalayan Times.


Follow The Himalayan Times on Twitter and Facebook

Recommended Stories:

More from The Himalayan Times:

Nepal's Covid-19 recovery rate sees improvement in the last 7 days

KATHMANDU: Nepal has witnessed a relatively significant rise in the number of COVID-19 recovery cases in the last seven days, compared to the past weeks, adding a glimmer of hope as the nation as a whole grapples with the rapidly rising number of positive cases. In the last week alone, as many as Read More...

Locusts devour crops on 1,100 hectares

KATHMANDU, JULY 3 Desert locusts have damaged crops cultivated on 1,100 hectares of land across the country. According to the Locusts Information Centre, eight districts have reported damage caused by locusts till date. Of them, Dang is the worst hit and Palpa the least. The locusts devoure Read More...

World Bank elevates Nepal to ‘lower middle income economy’

Country saw its GNI per capita rise to $1,090 in 2019, but economists says it doesn’t mean much in terms of development KATHMANDU, JULY 3 Nepal is now officially a lower-middle income country, an upgrade from its previous status as low income nation, according to the World Bank’s latest coun Read More...

Oli, Dahal in bid to save NCP unity

If the two co-chairs fail to act as per the spirit of the party unity document, maintaining party unity will be difficult  - NCP leader Mani Thapa KATHMANDU, JULY 3 Co-chairs of the ruling Nepal Communist Party (NCP) — Pushpa Kamal Dahal and Prime Minister KP Sharma Oli — held talks for thr Read More...

Kailali's Bhajani Municipality, Joshipur Rural Municipality inundated

KAILALI, JULY 3 Bhajani and Joshipur of Kailali have been inundated after floodwaters gushed into the settlements. According to eyewitnesses, many houses in Wards 2, 3, 6 and 8 of Bhajani Municipality have been inundated. Local Ganga Chaudhary said floodwaters from local Kandra and Kadha ri Read More...

Ministry develops guidelines for rehab centres

KATHMANDU, JULY 3 The Ministry of Women, Children and Senior Citizens has developed guidelines for operation of rehabilitation centres to ensure that vulnerable persons at the centres do not contract COVID-19. MoWCSC said the new guidelines would be effective until Nepal was declared coronavir Read More...

Nepali Congress Ram Chandra Paudel

Country pushed into crisis: Paudel

DAMAULI, JULY 3 Senior Nepali Congress leader Ramchandra Paudel said sudden prorogation of the Parliament was unfortunate for the nation. “At a time when the nation is fighting a deadly disease, the decision to prorogue the Parliament has pushed the country further into the crisis,” said t Read More...

Holding centre in Khotang

KHOTANG, JULY 3 A 10-bed holding centre has been established in Diktel, the district headquarters of Khotang, for returnees. According to Chief District Officer and District COVID-19 Crisis Management Centre coordinator Shaligram Sharma Poudel, Nepali Army personnel and Red Cross staff jointly Read More...