All-powerful power body in offing
KATHMANDU, APR 07 -
The government has prepared a draft bill to form a semi-judicial Energy Crisis Solution Commission having sweeping authority. The commission will have the authority to grant licences for survey, construction, transmission, distribution and also to scrap the licence and hike electricity tariff.
Brought to expedite power projects’ construction and remove existing barriers, the proposed bill, according to energy experts, could encourage autocracy. Officials at Ministry of Energy fear that the proposed sweeping powers may lead to misuse of authority by the commission. “Although it has been said that this commission is applicable just for five years to produce 2500 MW of power, it may invite authoritarianism of the commission,” said an official at the Ministry of Energy. Private power developers also fear the right to scrap licences may be misused.
The government on March 23 had declared ‘energy crisis’ in the country for the next four-and-a-half years and decided to form an all-powerful energy crisis solution commission.
The proposed bill has limited the authority of existing institutions associated with power development from the Ministry of Energy (MoE), Nepal Electricity Authority (NEA) to the Department of Electricity Development (DoED). The commission will now exercise the right of power purchase agreement, earlier enjoyed by NEA. Likewise, the right of granting and scrapping licences was with DoED earlier. “The content of the proposed bill indicates that the authority of NEA and DoED has been completely reduced,” said a senior official at DoED.
However, a senior MoE official said that the authority of the commission would be only applicable for production of 2500 MW of power. “The commission will work for the development of 2500 MW of power in the next five years,” said the official. As per the proposed bill, a three-member committee represented by Energy Minister and Chief Secretary and independent experts fixed by the Cabinet will appoint the members of the commission. Earlier, it had been planned to include the finance minster in place of an independent expert. Due to the Maoists’ opposition, the provision of the finance minister representing the committee was dropped.
With attempts being made for political appointees as members of the commission, there are apprehensions that it may not be as independent as it should be. “Even though the proposed bill talks of appointing persons with high moral integrity as members of the commission, efforts are being made to appoint ruling parties’ leaders as members,” said a senior official at the ministry.
The idea of the powerful energy commission was felt because of the Ministry of Energy’s failure to address the power crisis. The ministry remained inactive for several months following a rift between then Energy Minister Prakash Saran Mahat and Energy Secretary Shankar Koirala. The Mahat-Koirala spat also stalled the power development agreement (PDA) with seven hydropower projects.
Ministry officials admit the failure of the ministry to work in coordination with other concerned government agencies is responsible for the birth of the all-powerful commission. Independent power producers say the ministry hasn’t been able to start any work on power development since the last 10 months. “There has been no work by the ministry since the last 10 months,” said Subarna Das Shrestha, president of Independent Power Producers’ Association of Nepal.
With power developers experiencing hurdles in land acquisition, the proposed bill has given authority to the commission to acquire land required for the development of power projects. It has also talked of waiving income tax for the first 10 years for projects that start construction within the energy crisis period and decided on a 50 percent waiver in income tax for the next five years. The bill also proposed establishing a power fund.
Source: Kantipur
The government has prepared a draft bill to form a semi-judicial Energy Crisis Solution Commission having sweeping authority. The commission will have the authority to grant licences for survey, construction, transmission, distribution and also to scrap the licence and hike electricity tariff.
Brought to expedite power projects’ construction and remove existing barriers, the proposed bill, according to energy experts, could encourage autocracy. Officials at Ministry of Energy fear that the proposed sweeping powers may lead to misuse of authority by the commission. “Although it has been said that this commission is applicable just for five years to produce 2500 MW of power, it may invite authoritarianism of the commission,” said an official at the Ministry of Energy. Private power developers also fear the right to scrap licences may be misused.
The government on March 23 had declared ‘energy crisis’ in the country for the next four-and-a-half years and decided to form an all-powerful energy crisis solution commission.
The proposed bill has limited the authority of existing institutions associated with power development from the Ministry of Energy (MoE), Nepal Electricity Authority (NEA) to the Department of Electricity Development (DoED). The commission will now exercise the right of power purchase agreement, earlier enjoyed by NEA. Likewise, the right of granting and scrapping licences was with DoED earlier. “The content of the proposed bill indicates that the authority of NEA and DoED has been completely reduced,” said a senior official at DoED.
However, a senior MoE official said that the authority of the commission would be only applicable for production of 2500 MW of power. “The commission will work for the development of 2500 MW of power in the next five years,” said the official. As per the proposed bill, a three-member committee represented by Energy Minister and Chief Secretary and independent experts fixed by the Cabinet will appoint the members of the commission. Earlier, it had been planned to include the finance minster in place of an independent expert. Due to the Maoists’ opposition, the provision of the finance minister representing the committee was dropped.
With attempts being made for political appointees as members of the commission, there are apprehensions that it may not be as independent as it should be. “Even though the proposed bill talks of appointing persons with high moral integrity as members of the commission, efforts are being made to appoint ruling parties’ leaders as members,” said a senior official at the ministry.
The idea of the powerful energy commission was felt because of the Ministry of Energy’s failure to address the power crisis. The ministry remained inactive for several months following a rift between then Energy Minister Prakash Saran Mahat and Energy Secretary Shankar Koirala. The Mahat-Koirala spat also stalled the power development agreement (PDA) with seven hydropower projects.
Ministry officials admit the failure of the ministry to work in coordination with other concerned government agencies is responsible for the birth of the all-powerful commission. Independent power producers say the ministry hasn’t been able to start any work on power development since the last 10 months. “There has been no work by the ministry since the last 10 months,” said Subarna Das Shrestha, president of Independent Power Producers’ Association of Nepal.
With power developers experiencing hurdles in land acquisition, the proposed bill has given authority to the commission to acquire land required for the development of power projects. It has also talked of waiving income tax for the first 10 years for projects that start construction within the energy crisis period and decided on a 50 percent waiver in income tax for the next five years. The bill also proposed establishing a power fund.
Source: Kantipur
