Nepal’s precious electricity going waste

While almost 10% of the Nepali population continues to live without power, the Nepal Electricity Authority (NEA) has begun to export surplus electricity to India citing the absence of transmission lines to transport power to load centres.

Nepal reached a deal with the Indian Energy Exchange (IEE) on 1 November and from the following day began exporting up to 39MW of surplus electricity to India as part of the first phase of the agreement. However, even while the country sold excess electricity across the border, many parts of the far western districts of Bajhang, Dolpa, Bajura, Jumla and Mugu are not yet connected to the national grid.

Three major transmission lines are in various stages of construction: the Butwal-Bhairawa double circuit which was started two years ago, the Biratnagar-Inaruwa 132KV line that began five years ago, and the Inaruwa-Dhalkewar-Hetauda 400KV transmission line which was started a decade ago.

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The market for electricity expands beyond the border, but industries at home, particularly cement and steel, are still unable to operate at full capacity due to the unavailability of required electricity.

The Sarvottam Cement factory in Sunwal of West Nawalparasi has been forced to reduce working hours and run on generators, as the NEA only supplies 8MW of electricity from the 20MW required for the factory to run at full capacity. Of that, only 6MW of the electricity is actually usable because of circuitry and voltage issues.

To make up for the shortage, Sarvottam Cement set up its own diesel-powered plant, but this only adds to the cost. NEA supplies electricity at Rs10 per unit, while a unit of electricity from a diesel-powered plant costs Rs27.

“The country and industry both would have prospered had the government prioritised transmission lines and increased electricity consumption within the country," says Surendra Mahaseth, manager of the electricity department at the factory. The government made a policy-level decision last year to extend the national grid, prioritising cement and agro-based industries. But delays in the construction of transmission lines have stymied progress.

It is not just industries that are worried. Private power producers which have already started construction are worried that their power will have limited distribution because of the lack of adequate transmission lines. Adding to their doom and gloom is the protracted delay in ratifying the US-supported $500 million Millennium Challenge Corporation (MCC) project to build a 400kVA transmission line in Central Nepal to distribute power westwards as well as to India through the Butwal corridor.

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Meanwhile, the Argakhanchi Cement Industry requires a transformer with a capacity of 20 mega-volt ampere (MVA) for its operation, but is only supplied with one for 10 MVA. Like Sarvottam cement, it has set up its own diesel power plant that produces 2.5MVA current.

“We have been asking for as much electricity as we can get, and have been promised that it will be available soon,” says Uddhav Karki, manager of Argakhanchi Cement industry. “We will have to see if that happens.”

Meanwhile, NEA has started supplying electricity this week through its 132kV Bardaghat-Sari transmission line to supply 30MW of power to Hongshi Cement Nepal-China joint venture in Nawalparasi. There is hope that more will follow, but so far Hongshi looks like the exception.

The NEA has cited delays in building substations and transmission lines as the reason why it cannot distribute surplus electricity during the monsoon, leading to its wasteful ‘spill’. It has blamed private landowners haggling over compensation for transmission lines over their property and lengthy legal battles for the delays.

"All planned transmission lines under construction across the country should have been completed within two years, but there is a lot of local opposition,” says NEA spokesperson Suresh Bahadur Bhattarai. “If only these pylons could be laid, we could reach customers and not have to waste a single watt.”

However, others blame the scarcity of electricity on policymakers who prefer to export electricity rather than expand and expedite transmission lines and substations to increase access within Nepal.

“It is like selling food to a neighbour while your own family goes hungry,” says water resource expert Ratna Sansar Shrestha. “We would have earned much more by increasing electricity consumption in the country and reducing the use of fossil fuels. This is the result of a three-decade-long ‘grand design’ by the Nepal government to earn profit by exporting electricity instead of building infrastructure within the country.”

NEA could actually earn more from selling power domestically instead of exporting it. Nepal’s private industries are paying up to Rs11 per unit in electrical bills, while the average price of electricity sold to India is just Rs4.33 per unit.

Environmental campaigner Bhushan Tuladhar agrees that successive governments have failed to increase domestic electricity consumption by either not having the transmission lines to take it to load centres, or pricing it too high. He asks: “Why has the government not taken any steps to operate trolleybuses and electric public transportation despite having included it in multiple five-year plans?”

He adds that the government has failed to form an environment protection and climate change management committee even though it made a promise to do so years ago.

Adds Tuladhar: “When the government fails to build proper infrastructure and a strategic plan to increase electricity consumption for Nepali industries, transportation and households, it is left with no choice but to export it.”

Translated from the original by Shristi Karki.

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