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| Ratna Sagar Shrestha/ THT |
The cost of power for domestic industries has sky rocketed due to constant power cuts
Sujata Awale
Kathmandu
The valley is once again suffering from a severe power crisis of up to 11 hours per day. Long hours of power cuts have not only hampered city dwellers but are hampering the whole economy. The cost of production for domestic industries has sky rocketed rendering them incapable of competing against with imported products in terms of price. Dependency on trading business has also increased which is not a good sign for the economy. Due to acute power cuts, industrialists state that existing industries are facing a hard time and it is impossible to start new ventures. While load shedding has affected the whole economic chain, the government is yet to prioritise the construction of domestic and international hydel projects on line.
High demand low supply
Owing to less energy production, high demand and problems in ongoing hydel projects, Nepal Electricity Authority (NEA) is importing power from India to mitigate the crisis. As of now NEA is importing around 235 MW electricity from India, which is 55 MW more as compared to the same period last year.
NEA had extended an hour of load shedding a few weeks ago stating that the Mid Marsyandi Hydropower Project was scheduled for maintenance. “We have completed the maintenance work and now the hydropower is functional,” said Bhuwan Chettri, Chief of the Load Dispatch Centre at NEA, adding that the project contributes 36 MW power to the national grid in the dry season. “We are planning to import more power from India to decrease the load shedding hours. However, the process is pending due to conductor upgradation on the Indian side,” informed Chettri.
Electricity demand this year has swelled by 10 per cent as compared to last year. The current demand for electricity is around 18.6 million units per day and there is a good chance this demand will grow. Citing that the demand for power has increased unexpectedly this year, he said, “The current demand is what we expect in the months of mid-February and mid-March usually, but the urgency this year could also be because of the shortage of LP Gas in the country.” He further said that the load shedding hours may extend in days to come if demand increases. To meet the current demand, the country needs to generate 1,250 MW of electricity. However, NEA can supply only around 400 MW through domestic hydroelectric projects and by importing 235 MW.
SAARC miracle
It is a well known fact that the valley did not suffer from power cuts during the SAARC Summit held in November, 2014. This fact does not sit well with Kathmanduites given the long hours of power cuts immediately after the conclusion of the Summit.
When asked about the reason behind this miracle, Chettri commented, “We had totally disconnected the power of industrial areas and had increased load shedding hours in other parts of the country to maintain smooth supply in the valley during SAARC Summit. Therefore, there were no power cuts during the period.”
No priority, no power
“The power cuts will not come to an end anytime soon as we don’t have capacity to meet soaring demand,” said Khadga Bahadur Bisht, President of Independent Power Producers Association of Nepal. Citing that there is no proper planning from the government side, he said, “As Mid Marsyandi Hydropower Project was shut for maintenance during the peak dry season when the power crisis was up, people had to suffer felongated load shedding.”
Bisht stated that the only solution is to import from India during the dry season. He said, “We face severe power cuts since the last seven years and the problem will remain same if the government doesn’t take any initiative and proceed with developing new hydel projects.” He further stated that the government should expedite the process of giving approvals for new domestic and foreign hydel projects. He opined that the government should solve the issues regarding project development agreements, power trade agreements and construction of transmission line connections to solve load shedding problems in future. “Otherwise the problem will hover around in future too and the country will be in a worse state than now,” he warned.
Wasted energy
While the country is reeling under severe power crisis, generated power is wasted due to lack of transmission line connection. Mai Hydropower (22 MW) promoted by Sanima Hydropower Pvt Ltd (SHPL) has completed the construction of the project and is ready to generate power since December 26, 2014. However, the transmission line of Kabeli Corridor 132 kV transmission line from Damak to Godak is yet to be completed. As the main transmission line project could not be completed, NEA has worked on an alternative way to connect the project with the 33 kV Godak to Puwa transmission line for the dry season.
“It has been a month since we completed our project and are ready to generate power. However, we could not go for generation as NEA could not complete the transmission line on time,” said Dr Subarna Das Shrestha, CEO of SHPL. According to him, they got an alternative transmission line to transmit eight MW power produced in the dry season. “If the 132 kV transmission line from Damak to Godak project is not completed within few months, our power will be wasted,” he said.
“The work of alternative transmission lines have been completed but due to technical problems at the project site, the power production has been halted,” informed Chettri. He said that NEA is working on the 132 kV line and that they target to complete it by mid-July. Reportedly, of late, only 26 towers have been erected out of 95 towers.
Impact on industries
The industrial sector is in the dark due to load shedding. Industrialists complain about difficult working environment and going at la huge oss. “Power is the back bone of industries. No work can be done without power,” said Pradeep Jung Pandey, President of the Federation of Nepal Chambers of Commerce and Industries. “To mitigate this power crisis, we use diesel generators which increases our cost of production by five times,” he complained, adding that generator produced power costs Rs 35 per unit. Citing that most of the load shedding hours are during working hours, he said, “As industries cannot run full-fledged due to prolonged load shedding, unemployment problems increase. Moreover, with the increase in cost of production, Nepali products have not been able to compete with other imported products.”
Pandey is of the opinion that without proper supply of power, the country cannot have GDP growth. Stating that the government should proirtise hydropower and industrial sector, he opined, “Political will should be there to solve this power crisis. Timely policymaking and implementation should take place. And the government should create a favourable environment for investment in hydel projects.”
Economic turmoil
The dependency of trading business and imported products has been increasing by the year. “Nepal’s economy is stagnant at the moment,” said Chiranjivi Nepal, Economic Advisor of Prime Minister. He further stated, “Our economy is dependent on trading business each year which is unhealthy for the economy. The trade deficit has increased and we are depending on other countries for almost everything.”
As per the latest report of Nepal Rastra Bank, Nepal has already imported Rs 350 billion worth of products during the last six months of the fiscal year 2014-15 and the country witnessed Rs 300 billion trade deficit. Last year, the country had Rs 618 billion trade deficit which exceeded the allocated budget of Rs 617 billion.
According to him, “Electricity is vital for the development of internal economy. Despite having 83,000 MW potential for hydropower projects, the country could not make the most of it.” Stating that solar power and diesel plants are not feasible in the country, he said, “Solar does not have long life cycle and we have to import all instruments from aboard while diesel plants are expensive. The only option is to develop the hydropower sector.” He said that strong political will is lacking to boost the sector. “Political leaders have to crack down on the hydropower issue and commit to increase power production for the prosperity of the country,” he said.
Published on February 15, 2015 on THT Perspectives
http://epaper.thehimalayantimes.com/Details.aspx?id=1259&boxid=29017508&dat=2/15/2015
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