Nepal Electricity Regulatory Commission to take shape soon: Energy Ministry

KATHMANDU: After getting the nod from the Ministry of Finance, the Ministry of Energy has begun necessary homework to establish Nepal Electricity Regulatory Commission (NERC).

With this development, the idea of forming a high level body that would regulate generation and transmission of electricity along with fixing tariffs and implementing a National Grid Code to govern power sector in the country has come alive after 16 years from its inception.

The parliament on August 2017 had endorsed the Electricity Regulatory Commission Bill, now an Act, presented by the then Energy Minister Janardan Sharma acknowledging the need of an independent regulatory body to govern electricity market for its further development.

Ministry of Finance, after analysing the financial and liability aspects of the regulations proposed by the Energy Ministry, gave an approval allowing the energy ministry to seek further counsel from other ministries prior to formation of NERC.

“We have forwarded the document to Ministry of Law, Justice and Federal affairs and will present it to the cabinet after receiving necessary feedback from the authorities,” Joint Secretary and Spokesperson at Ministry of Energy Dinesh Kumar Ghimire said, “As of now we have began homework regarding the organisational structure of the soon-to-be-formed Commission.”

According to Ghimire, the regulator after its inception will develop a National Grid Code to govern the power entities in the Country.

Moreover, the Commission is said to administer the power purchase agreements, fix tariffs and transmission-network charges, and initiate license-compliance monitoring in the beginning and work for creating a competitive market in power sector later on.

“The Ministry will soon call upon applications from interested candidates to take up the posts of Chairman and other members of the Commision,” Ghimire said.

The Commission will have one chair and four members, and the appointments are said to be made on the basis of principle of proportional inclusion.

Earlier, an Energy Crisis Prevention Action Plan was issued by the government on February 18, 2016 incorporating a provision on the formation of a high-level Electricity Regulation Commission.