Excerpts:
Myrepublica.com: What was the purpose of your visit to Germany?
Dr Prakash Sharan Mahat: My Germany visit has been productive in the sense that the German government is positive towards our request for a grant to establish a thermal plant for generating 50-100 MW, which will be crucial in addressing the power-cut problem in winter. We will soon forward a proposal in this connection.
Resources are important as the thermal plant is an expensive option for Nepal. We hope to be able to install the new plant within three or four months.
Myrepublica.com: How many hours of loadshedding will people have to face this winter?
Mahat: We are looking to bring the loadshedding down to 8-10 hours a day. Three things will determine this. First, we will import an additional 50-60 MW from India besides the existing supply. Second, existing projects and thermal plants will be upgraded and maintained for optimum generation. And finally the Ministry will do its best to set up a new thermal plant under German grant.
Myrepublica.com: How will the existing problems with hydro-projects be addressed by the government?
Mahat: There are surely problems in the run-of-river projects which will not generate even 50 percent of total capacity. For this the technical problems will be addressed by replacing equipment and carrying out due maintenance.
Myrepublica.com: It is said that on average there is 20 percent leakage in the supply system. How can this be controlled?
Mahat: Controlling leakage is important from the revenue point of view. There are two parts to this. If we can stop technical leakage, we can provide additional power for households and industries. Another problem is theft through hooking onto the mains. For this, the NEA board has formed a committee which will report to the government within a month. The government will act according to the report.
Myrepublica.com: What progress has been made in developing transmission lines?
Mahat: There is no alternative to power purchase agreements with India. For this, infrastructure development is vital. This is necessary for future power export and also for immediate purchase.
There has to be a modality, which we have to agree with India. We are doing the required homework for this. We will hold talks soon to reach an agreement.
Myrepublica.com: There seems to be confusion on whether your ministry or the Ministry of Irrigation will head the talks with India.
Mahat: There is no confusion at all. If the energy part is dominant, MoE will lead and if irrigation is dominant, MoI will do the needful. Even for the upcoming talks, the team will comprise members from both ministries.
Myrepublica.com: How far have the negotiations reached on the Pancheshwar Multipurpose Project with India?
Mahat: The meeting of the Joint Commission on Water Resources is scheduled for the first week of November and is to be followed soon after by ministerial-level talks that will take up all issues relating to the setting up of the Pancheshwar Development Authority and reach a conclusion.
We have informally agreed to locate PDA headquarters in Nepal.
Myrepublica.com: Why is the UCPN-Maoist against Pancheshwar now?
Mahat: They were ready to go ahead with the project when they were in government, but now they are protesting against it. This is pure politicization. Since there are no ideological differences, we must go ahead with it.
Since India is ready to accept Nepal´s proposal, the time is apt and we must capitalize on this opportunity. The people should know that we will sign the project in the interest of the country. Time is favoring us, so we must not let it go, and if we do, we will prove our own ignorance.
Myrepublica.com: What can be done to address local problems faced at the project sites?
Mahat: There are many policy and institutional problems. But since we have serious investors, both domestic and foreign, the government will play the role of facilitator.
But we need to develop a mechanism to involve the locals as partners. Just as with the Upper Tamakoshi, where 10 percent of share is being given to the locals, a similar mechanism can be worked out. We need to deal with legal aspects and we will take care of them. People should feel the projects are in their interest and will benefit them.
The share can be determined as per the nature of the project. Also, it is necessary to develop compensation mechanisms to give some relief to the people if it involves their large-scale uprooting.
Myrepublica.com: West Seti is under parliamentary investigation; what went wrong?
Mahat: The problem was that the promoters could not generate the required finances. The Public Accounts Committee is investigating so we cannot conclude anything before the findings are in.
West Seti is an important project in the far-western region and it can play a lead role in the development of that region along with Mahakali and Pancheshwar.
Myrepublica.com: In the budget announcement, it was said the government would initiate some storage projects. What is the progress here?
Mahat: The budget has been allocated for the Upper Seti in Tanahun. Some foreign investors have shown interest in Aandhi Khola and we are looking for suitable investors in the Budhi Gandaki. And for Jajarkot´s Naxalghat, a loan proposal has been forwarded.
Myrepublica.com: Is it true that there are financial problems with Upper Tamakoshi?
Mahat: We have alternatives. The Nepal Army and Nepal Telecom have shown interest in investing in Upper Tamakoshi. We also want private banks to come forward. They have shown interest too, but there are conditions.
The NA is also building the access road as per our request, and it will be completed by February-March.
Myrepublica.com: There were news reports that the Asian Development Bank is hesitant to issue a loan for transmission line construction. Is this true?
Mahat: I recently spoke with the ADB South Asia representative, and the bank is positive and is also interested in giving a loan for Upper Seti.
Myrepublica.com: How will the government reach its target of generating 25,000 MW? Is it a sensible target?
Mahat: The time factor is very important. Even a medium-size project takes seven or eight years. So if we can initiate say 1000-2000 MW projects like the Mahakali, which are in the pipeline now, we can achieve the target in 20 years.
A committee has also been formed by the Cabinet, which will recommend to the government what needs to be done to meet that target.
Myrepublica.com: You had said when you took over that alternative energy is in your policy guidelines. What progress has been made in this regard?
Mahat: I spoke of three objectives. First, the steps to be taken to address the immediate power crisis. Second, working for encouraging serious investors to expedite the hydropower projects. And third, to look for alternative sources of energy and explore solar, bio-gas and wind power on a commercial basis. Wind energy is a serious alternative option since India and China are also opting for it on a large scale.
Myrepublica.com: How will the government control misuse of licenses?
Mahat: We want to issue licenses only to serious investors and discontinue the first-come-first-served policy. Then we hope to engage in strict monitor of progress. Those who do not make satisfactory progress within the given time will have their licenses canceled.
But for those who complete the work on time, the power purchage agreement should be made available immediately. This will be done promptly.
(All photos by Bikash Karki.)
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