Kathmandu, 17 Aug: Nepal Electricity Authority (NEA) has announced plans to double electricity exports by the end of the current fiscal year (2082/83). In the last fiscal year, electricity worth NPR 17 billion 45 crore was exported. As per the plan, NEA aims to export electricity worth around NPR 35 billion through the Indian Energy Exchange (IEEX), medium-term agreements with India, and exports to Bangladesh. Executive Director Hitendra Dev Shakya informed that preparations are underway accordingly.
Nepal has received permission to export a total of 810.9 MW of electricity. Just last Monday, the Indian government granted additional approval for exporting 200 MW more. According to Shakya, another 200 MW is in the final stages of approval.
“Despite the damage caused by last year’s floods in Upper Tamakoshi, we have managed to become a net electricity exporter. This year, our exports will double,” he said.
Apart from plans to increase export figures, Shakya mentioned the Authority has transformation plans for other sectors too. Established in 2042 BS (1985) with responsibility for just 200 MW of electricity and limited customers, the Authority is now entering its 40th year while managing about 3,500 MW of electricity.
Shakya said the Authority now needs to work differently in areas like leakage control, quality power supply and infrastructure development.
Pump Storage and Battery Storage
NEA plans to regulate electricity supply through pump storage projects and battery storage systems.
About two years ago, NEA had applied to the Department of Electricity Development to build a 100 MW pump storage project in Sisdole, using water from the Kulekhani hydropower project. However, the project was suspended after being deemed unviable.
Now, NEA has started preparations for a 500 MW pump storage project in Bullingtar, near Kurinchat. Additionally, to enhance grid stability and efficiency, NEA plans to install high-capacity batteries at substations to ensure uninterrupted power supply to consumers.
The Nepal Electricity Authority (NEA) has recently faced accusations of putting pressure on private power developers. Critics allege that NEA has stopped power purchase agreements (PPAs) for hydropower projects, not extended RCOD deadlines, and implemented a “Take and Pay” policy for run-of-river projects. However, NEA’s Executive Director Hitendra Dev Shakya maintains that these measures are intended to safeguard the private sector’s long-term interests.
Moving forward, NEA plans to secure electricity export commitments from India before beginning project construction to ensure guaranteed sales. Additionally, the authority aims to involve private sector in transmission line development through a “build and lease” model, where private companies construct transmission lines and receive usage fees in return. This approach is already being implemented in projects like the 400 kV Bajhang-Nilegad-Dododhar transmission line being developed by the National Transmission Grid Company.
The authority is also exploring ways to bring private investment into transmission infrastructure development while maintaining grid reliability and efficiency. These strategic shifts come as NEA seeks to balance domestic power needs with growing export opportunities while addressing criticisms from private developers.
No share but bond
Nepal Electricity Authority (NEA) had previously considered issuing ordinary shares but has now concluded that this option is currently neither feasible nor suitable. According to Executive Director Hitendra Dev Shakya, legal complexities and justification for share issuance remain unverified.
As an alternative, NEA finds issuing bonds more appropriate. “Such loans will provide funds for infrastructure development, and the repayments can be covered by the income generated from those same infrastructure projects, ensuring the Authority’s long-term financial security,” Shakya explained.
This approach allows NEA to secure necessary financing while maintaining sustainable debt management through project-generated revenues.
Recently, the Nepal Electricity Authority (NEA) has faced criticism regarding the quality of power supply and electricity leakage issues, with allegations that the authority has weakened in these areas. However, Executive Director Hitendra Dev Shakya refutes these claims, stating that the data does not support such assertions.
Shakya shared that while electricity leakage (system loss) was previously at 12.73%, it has now decreased to 12.26%. Additionally, he mentioned that last year, there were 1,200 tripping incidents nationwide, resulting in an average of 595 hours of power supply disruptions.
NEA continues to work on improving power reliability and reducing losses, though challenges remain in maintaining consistent electricity distribution across the country.
10,000 megawatts in 10 years
The Nepal Electricity Authority (NEA) has started implementing plans to expand electricity distribution and domestic consumption capacity to utilize 10,000 MW of electricity within the next 10 years, as per the government’s energy development roadmap.
NEA aims to increase per capita electricity consumption to 750 units in the next five years and further raise it to 1,500 units in the subsequent five years. The authority has already begun upgrading distribution networks to achieve these targets, focusing on enhancing domestic power consumption capabilities to match the nation’s growing generation capacity.
This initiative represents a strategic shift towards maximizing utilization of Nepal’s electricity resources within the country while supporting broader economic development goals.
