Dept set to issue license for power projects up to 100 MW

Published On: August 24, 2016 12:50 AM NPT By: Rudra Pangeni


A 'meaningful reform' in hydropower licensing
KATHMANDU, Aug 24: Hydropower producers of up to 100 MW will soon not have to wait for the decisions of the Ministry of Energy (MoE) for permission carrying out survey studies, building the power plants and generating electricity.

The time-consuming six stages that have to be gone through at MoE for procuring the licenses for hydropower projects will be omitted, and this is being taken as a meaningful reform after the government opened the doors in the 1990s  for private sector involvement in hydropower development.

This reform has been effected under the fourth amendment in the Electricity Regulations 1993, but the amendment is still subject to cabinet endorsement. The authority of the energy secretary to issue licenses has been transferred to the director general of the Department of Electricity Development (DoED) at Anamnagar Thapagaun. The energy secretary currently issues licenses for all power projectgs starting from 1 MW.

Minister for Energy Janardan Sharma gave his approval for the new regulations on Tuesday and he will register them at the cabinet for final endorsement. Talking to Republica, Sharma said the amendment is meant to make hydropower licensing faster and more investment friendly.

DoED at present receives the applications for hydropower licensing and prepares the documentation but it won't need to forward these to the energy secretary for the licenses once the amendment is endorsed by the cabinet.

 The process of amending the rules started three months ago as per a concept paper, 'National Energy Crisis Prevention and Electricity Development Decade 2016-2026'. The concept paper, however, had dealt with power projects of up to only 25 MW. The amendment excludes hydropower projects that are of a multipurpose nature and of the reservoir type.

Energy Secretary Suman Prasad Sharma said that he was for focusing on policy decisions rather than handling minor licensing processes.

"Removal of the cycle that a file goes through at my ministry  can make things easier for power developers who have often complained about the time-consuming process," added Sharma.  

Meanwhile, the private sector has welcomed the decision. Kumar Pandey, general-secretary of Independent Power Producers' Association Nepal, said, "It would be a really meaningful reform in licensing since the1990s as we will have to deal with fewer people and the whole process will become faster."

Pandey surmised that this would be helpful particularly for domestic power producers as they are generally engaged in power plants of only up to 100 MW. There have been some reforms but not on this scale, he said. One hydropower developer, who declined to be named, said it will also help in curbing corruption in licensing.

This devolution of authority also applies to solar power, wind power, bio-mass and energy generation from waste, as well as transmission and distribution of electricity.


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