When will load shedding end?
To end load shedding, we have to increase electricity production. The demand for electricity is rising every year, especially for rural electrification. Even in cities, given the ways population and services are rising, the demand will increase. There are, of course, various ways to reduce it even without increased production.
Does the Ministry of Energy have a fixed date by which it wants to end load shedding?
If we work with high determination, we can end it in two and half or three years. We
can’t expect much from present working methods and accomplishments. But with proper work we can also give electricity to all of the people. It rests on how good you work. In a 100 year-old history of electrification we’ve only produced about 639 MW.
So we might have to wait for another 100 years?
Load shedding has been reduced a lot in recent days. There are many ways to reduce it in the winter as well. For example, by increasing the capacity of existing production units with maintenance and repair. If we can bring leakage down from 29 per cent to 20 per cent, that will save about 65 MW of power. Also, using the transmission line to India, we can buy electricity from India in the dry season, until our own production is sufficient to fulfill demand.
We also have multi-fuel, diesel plants in Biratnagar and Hetauda. They are being repaired at the moment. If should also think about running them at peak hours.
You talked about making electricity available to all people. How many people have access at present?
Not even 50 per cent of the people have
electricity in their homes. Given the geographic difficulties the investment required per family is high. We can electrify the remaining homes using transmission lines, or, in very remote areas, we can use solar energy. If extending the transmission lines is too costly, then micro-hydropower is also an option. With proper coordination, we extend access to every household within five years. People might say this is ambitious. But if we don’t work, some families won’t have electricity even in the next 100 years.
How do you see the “off the grid” solutions that do not rely on transmission lines?
Alternative energy is useful in some places. It’s comparatively more expensive. Alternative
energy has not been able to grow as we expected. Trying to extend transmission lines everywhere is not feasible.
What kind of projects do you have in mind?
If we can start multiple projects simultaneously, producing a few thousand mega watts of electricity is not that difficult. Small projects can be completed in two or three years.
How did the situation get to this point where even the economy suffers heavily from lack of power?
There never was a clear perspective, cooperation and an understanding of the importance of hydroelectricity. It can become the foundation of economic growth, employment and quality life—the state couldn’t understand this, and we got entangled in many issues.
What kind of issues?
We had these long debates about whether we should have big or small projects and whether we should seek foreign investment or use our own resources. Right now, we’re entangled in this debate on whether or not we should export the electricity that’s going to be produced. Lack of clarity and a clear national purpose is the reason hydroelectricity couldn’t develop as expected. Consequently, we’re facing a huge energy crisis. In my opinion, electricity is the most important sector for Nepal’s economic growth. If we can use even 20 per cent of our production potential, there’ll be a sea change in our living standard.
The power crisis must have made things clear to many people.
Well, even today, there’s no common perspective. People still haven’t realised that it’s primarily the government’s responsibility to develop this sector. Let me give an example, just last economic year, we imported Rs 60 billion worth of petroleum products. A parliamentary committee has stated that we can substitute at least 40 per cent of this import with electricity. The government gave subsidies equal to Rs 3.9 billion for LP gas. We all know that electricity can substitute LP gas.
How does lack of electricity affect other industries?
We’re importing cement and iron worth billions of rupees. Electricity will allow these industries to flower. It will create employment and economic activity. We haven’t really understood how strong of a backbone energy can be for the economy. I’ll give you another example: If we have sufficient electricity, we can develop irrigation facilities in the Tarai. It can tremendously boost agricultural productivity.
Can you tell us what you did as Minister of Energy?
We’ve started a few things both at the policy level and operationally. The executive director of Nepal Electricity Authority (NEA), for example, was chosen competitively. This was to free the NEA from political interference. The chairman of the NEA is not longer the minister but a secretary from the bureaucracy. We took effective actions to reduce load shedding, including a campaign to stop electricity leakage. We came strongly against institutions that hadn’t paid their electricity bills.
Why did you scrap the license for West Seti?
For sure, there were requests and pressure to extend the license for West Seti. But it didn’t look like that company was going to bring any investment and move ahead with producing 750 MW of electricity. So we scrapped the license. Nepal government is going to complete the project.
Does the government have the necessary capital to start such large projects?
We’re looking for loans with low interest rate.
Has the Chinese government shown interest in providing loan for West Seti?
Talks have progressed a lot. All that remains is a formal agreement.
There’s a perception among some in Nepal that we should be wary of Chinese investment.
The traditionalists think like that. But we have to protect our national interest and welcome
investment from any country—be it China,
India, America, Russia, Brazil, Kuwait—it doesn’t matter. However, whether or not we like it, we can’t change our borders and neighobours. We have to walk a balanced path that will give the country maximum benefit.
How much foreign investment is there in energy?
We haven’t seen a lot of it. The Norwegians are organising some projects and India is helping us, as are the Koreans. There’re some Chinese companies working in the country. But if we can improve the business environment, there’s a lot potential for foreign investment in hydropower. For that to happen we have to arrive at a political consensus and convince investors that their capital is safe.
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