Nepal | September 22, 2020

EDITORIAL: Incentive for energy

The Himalayan Times
Share Now:

The government should give more incentive to the private sector which has proven its efficiency in producing energy in two decades

The Finance Ministry has finally agreed to provide Rs. five million for per megawatt of electricity as an incentive to the private sector or Independent Power Producers (IPPs) who had been demanding that some sort of incentive be given to them for some years so that they can invest on hydro power projects.

Currently, the private sector is required to pay about Rs. five million for one megawatt of energy as VAT. This incentive to be given to the private developers is equivalent to the VAT amount charged for the purchase of hydro project related equipment.

The then Finance Minister Ram Sharan Mahat had announced that Rs. five million would be given to the IPPs as an incentive through the fiscal budget of 2014/15. But the Finance Ministry has yet to give its consent to the incentive despite the fact that it was announced through the budget speech.

The Finance Ministry had not given its consent citing dwindling revenue collection due to the devastating earthquake in 2015 and the months long border blockade. It took two years for the Finance Ministry to give its consent to provide incentive to the power developers who will be encouraged to engage more in the energy sector.

This incentive will remain effective till 2022/23. By that time the country will have enough energy to meet its domestic demand, as the private sector will immensely contribute to the national grid.

Currently, the private sector has contributed to 105 MW of electricity and it will have 630 MW by 2017-end, 100 MW more than the total installed capacity of the state-owned Nepal Electricity Authority which currently has 530 MW.

NEA is currently developing only two projects – 30-MW Chameliya and 14-MW Kulekhani III – whereas the private sector has more than half-a-dozen projects poised to provide energy by 2017-end.

Compared to the NEA’s snail’s pace of implementing hydropower projects, the private sector works harder to finish its projects on time with minimum overrun of cost. If more incentive is given to the private sector it will contribute more to meet domestic demand of energy, and ultimately the nation will benefit from the speedy development of power projects.

All governments formed after the Jana Andolan II have given special emphasis to development of hydropower projects to boost the economy. The Ministry of Energy has announced an “Energy Crisis Prevention and Electricity Development Decade” aimed at generating 10,000 MW of energy within a decade.

The incentive package will come into force once the Cabinet approves a guideline in this regard. All hydropower projects developed by IPPs by the end of 2022/23 will be entitled to receive Rs. five million as incentives for each megawatt of energy.

IPPs have welcomed the Finance Ministry’s consent, saying it would motivate them to make more investments in the energy sector helping transform the country from a least developed one to a developing economy by 2030.

The government alone cannot generate enough energy required for the nation to drive the economy forward. It should give more incentive to the private sector which has proven its efficiency in producing energy in two decades.


Sugar price hike

As the government has not been able to import sugar as per the demand there is a scarcity of sugar in the market. As a result, some unscrupulous traders are selling sugar at inflated prices hitting the consumers hard.

Various government agencies, including the Salt Trading Corporation (STC), are playing the blame game accusing each other of the delay in importing it. Moreover, the production of sugar has gone down in India from which the STC imports most of the sugar.

The STC says that as it possesses low quality sugar only it has not been able to release sugar in the market. It is the job of STC to see to it that there is an adequate stock of essentials like sugar.

The annual demand for sugar in Nepal is about 220,000 tonnes. The STC has proposed importing 50,000 tonnes of sugar from India. The delay in importing sugar is attributed to lack of permission and funds for importing this commodity.

Those responsible for the short supply of sugar should face the music. Time and again there have been shortages of sugar yet the concerned have not yet learnt lessons to have sufficient stock of sugar and other essentials.


A version of this article appears in print on March 01, 2017 of The Himalayan Times.


Follow The Himalayan Times on Twitter and Facebook

Recommended Stories:

More from The Himalayan Times:

Photo Gallery: Rohingya refugees receive relief in Kapan amid COVID-19 crisis

KATHMANDU, SEPTEMBER 21 Hiteri Foundation provided food relief packages to long-persecuted Rohingya Muslim refugees here in Kapan on Sunday, September 20. More than 175 families are taking shelter in Kapan after entering Nepal following a mass exodus from their native Myanamar. Also seen in pi Read More...

In Pictures: Lalitpur school provides internet facility to students sans access

Lalitpur, September 21 Teachers take online classes with internet facility provided by school at the empty classroom of Shree Rudrayanee Secondary School in Khokana, Lalitpur on Monday, September 21, 2020. The School has facilitated internet access to those students who cannot avail the same at h Read More...

Nepal records highest death toll in single day, 427 covid fatalities till date

KATHMANDU: Nepal on Monday reported its highest number of deaths from the novel coronavirus in a single day. As many as 16 Covid-19 fatalities were confirmed in the last 24 hours. It brings the total number of deaths in the country to nearly 427, according to data from Ministry of Health and Popu Read More...

A magnificent view of Kathmandu as captured from Swayambhu on Monday, May 9, 2016. Photo: RSS

674 more infections logged in Kathmandu valley, amounts to over 58pc of total new cases

KATHMANDU: Kathmandu valley on Monday logged 674 new cases of coronavirus infection. As per the Health Ministry's latest report, of the total cases, the capital recorded 538 cases while 62 new infections surfaced in Lalitpur. Meanwhile, the number of active infections have been increasing stea Read More...

Nepal COVID-19 Update: 1154 new cases, 1005 recoveries, 16 fatalities logged Monday

KATHMANDU: Nepal’s Health Ministry, in its regular press briefing, shared the latest updates on coronavirus contagion from across the country, and government’s response to the health crisis. Read Also: 674 more infections logged in Kathmandu valley, amounts to over 58pc of total new cases Read More...

Indian filmmaker Anurag Kashyap to pursue legal route against sexual misconduct allegations, actress Payal Ghosh to file FIR

KATHMANDU: Bollywood filmmaker Anurag Kashyap, who has been accused of sexual misconduct by budding actress Payal Ghosh, said he intends to pursue legal action while the actress has said she will file an FIR against him. Issuing a statement through his lawyer, Kashyap also said it was sad that a Read More...

Indian actress Richa Chadha initiates legal action after Payal Ghosh drags her name in #MeToo case against Anurag Kashyap

KATHMANDU: Bollywood actress Richa Chadha has revealed that she has initiated legal action against after her name was dragged in a defamatory in #MeToo case against filmmaker Anurag Kashyap by actress Payal Ghosh. In a video released to ABN Telugu, Ghosh claimed that Kashyap tried to harass her i Read More...

American actress Mindy Kaling finds Deepika Padukone, Sonam Kapoor talented, wants to work with them

KATHMANDU: Indian origin American actress Mindy Kaling wants to work with Bollywood actresses Deepika Padukone and Sonam Kapoor as she finds them talented. "I would love to work with Sonam Kapoor or Deepika Padukone. They're both so talented," Mindy was quoted as saying Read More...