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Industrialists against Raising Electricity Tariff

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Industrialists against Raising Electricity Tariff
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April 4: Industrialists have requested the Electricity Tariff Fixation Commission not to raise the electricity tariff.

The Board of Directors (BOD) of Nepal Electricity Authority (NEA) had proposed the commission to increase the electricity tariff citing increase in accumulated loss of the organization.

The commission had started interaction so as to draw suggestions on the proposal from consumers in various sectors.  In the interaction programs that took place in various locations in the country, the participating industrialists requested the commission to withdraw the idea of raising the tariff.  

“We will fix the tariff considering the advice given by the consumers,” said Jagat Kumar Bhusal, Chairman of the commission. “Although the expectation of NEA is upfront, the decision regarding the matter will not be taken instantly,” he said.  

Bhusal opined that the industrialists are paying more tariffs from mid-December to mid-March in the current fiscal year as compared to the review period of the last FY.

 “The industrialists are paying 60-85 percent more tariff than last year while using electricity after 11:00 pm. Therefore, it would not be reasonable to increase the burden on the industrialists,” he said.

However, Bhakta Bahadur Pun, board member of NEA said that the tariff needs to be raised as the present electricity tariff is cheaper as compared to the new power purchase agreement (PPA) issued by the Ministry.

“The Energy Ministry has raised the purchase rate of electricity to be paid by NEA to Independent Power Producers (IPP) as per the increase in cost of generating power,” he said, “We cannot sell cheap electricity by purchasing it at higher price. Thus our only demand is to fix the electricity tariff accordingly.”

The NEA BOD has requested the Commission to raise the electricity tariff of industries in the first phase and then to the domestic consumers consecutively. Last year only, the Authority had raised the tariff by 19 percent. In the proposal submitted to the Commission, NEA recommends 20 percent increase in electricity tariff.

However, the Electricity Tariff Fixation Regulation- 2050 permits for only 5 percent increment in the tariff. According to NEA, it spends Rs 12.13 per unit of electricity and supplies it to industrial areas at Rs 9.66 resulting in a loss of Rs 2.47 per unit. 

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