KATHMANDU: The Nepal Electricity Authority (NEA) has paved the way for the private sector to invest in the transmission line to be built by the National Transmission Grid Company Limited, which is promoted by the NEA.

Following directives from the Ministry of Energy, Water Resources and Irrigation, the NEA Board of Directors meeting on Friday amended the regulations, allowing private sector’s participation in the construction of transmission lines.

Netra Prasad Gyawali, Chief Executive Officer of the National Transmission Grid Company, stated that this decision was made because the private sector has shown interest in building transmission lines for a long time. "This is a golden opportunity for the private sector. This decision aims to solve the problem of electricity being wasted due to the lack of transmission lines," he said.

The Electricity Act 2048 allows the private sector to build transmission lines. However, until now, hydropower projects have built transmission lines only to deliver electricity from power plants to the national grid. According to the Department of Electricity Development, private sector entities such as National Hydropower, Bhotekoshi Power Company, Sanima Hydro, and Barun Hydropower Development Pvt Ltd have received such permissions.

Despite this, government officials noted that private companies have not ventured into building transmission lines alone. So far, only the NEA and its subsidiary, the National Transmission Grid, have been constructing transmission lines. Due to the lack of sufficient and reliable transmission lines, increasing domestic electricity consumption and exports has been challenging. Although the expansion of transmission lines is a top priority for the NEA, it is difficult to expand them as required with only its resources.

Gyawali said, "Government companies with limited investment are the only ones responsible for the construction of transmission lines and the sale and distribution of electricity. Now, with cooperation from the private sector, the structure of the transmission lines will increase, and there will be no such problem."

In the first phase, the NEA has opened the doors to the private sector for the construction of the Tamor-Dhungesanghu 220 KV and Lamabagar-Barhabise 220 KV transmission lines to be built by the National Transmission Grid Company.

"Government companies are finding it difficult to raise budgets for these projects, so these are the ones that have been opened for the private sector in the beginning," Navin Raj Singh, the spokesperson for the ministry, told New Business Age.

However, private sector investors are not entirely satisfied with this decision. Prakash Chandra Dulal, Deputy General Secretary of the Independent Power Producers Association of Nepal (IPPAN), argued that the private sector should not be content with partnering with government-owned companies just to raise capital.

"If the private sector is to be given authority, it should also be given responsibility for the construction of transmission lines and the sale and distribution of electricity," he said.