Govt okays pvt sector to build power lines
KATHMANDU, JAN 05 -
The government has decided in principle to allow the private sector to build power transmission lines.
The move has been prompted by the inability of the Nepal Electricity Authority (NEA) to expedite construction of transmission lines. The NEA is the sole body presently permitted to build transmission lines in the country.
Energy secretary Hari Ram Koirala said that Prime Minister Baburam Bhattarai, who is also looking after the Energy Ministry, decided to allow the private sector to erect power lines. “The private sector will be allowed to put up 33 percent of the total cost of any transmission line project,” said Koirala.
The private sector started showing interest in building transmission lines after seeing the NEA struggling with power line projects. A number of companies including Himalaya Energy Development Company (HEDC) have even submitted their proposals to obtain approval from the Energy Ministry. HEDC has proposed constructing the 132 KV Khimti-Gajryang transmission line under the BT modality.
The idea of inviting the private sector to construct transmission lines is not new. The Interim Plan has envisioned involving the public and private sectors, community and cooperatives in power generation and transmission. The government has planned to construct 408 km of transmission lines in the current Interim Plan (2010-11 to 2012-13).
However, not a single transmission line project has been completed even though the NEA started work on the Bharatpur-Hetauda, Khimti-Dhalkebar
and Thankot-Chapagaun-Bhaktapur lines. “Realizing the sensitivity of the issue, the private sector is being drawn towards financing transmission line projects,” said Koirala.
With the private sector showing interest in erecting power lines, the Energy Ministry had asked the NEA to study the probability of involving it. Subsequently, the NEA recommended to the government to allow the private sector to erect transmission lines under two models: Build-Own-Operate-Transfer (BOOT) and Build and Transfer (BT).
In its report submitted to the Energy Ministry in May 2012, the NEA had stated that the private sector could be allowed to build transmission lines to evacuate power from hydropower
projects smaller than 25 MW with which the government had signed power purchase agreements (PPA).
The report also stated that interested developers would have to sign a transmission service agreement (TSA) with the NEA and could make the financial management on this basis. The report has also said that the government could transfer transmission line projects being built by the NEA to the private sector.
Joint secretary at the Energy Ministry Sunil Kumar Malla said that the ministry would soon ask the NEA to prepare a model along with a draft of the TSA to encourage the private sector to invest in transmission lines. NEA spokesperson Sher Singh Bhat said that the ministry’s decision was a welcome move and that the expertise and capital possessed by private investors would help in the development of transmission lines.
“As the private sector is much more flexible in project development than the NEA and they can also encourage the local people, its involvement in building transmission lines will benefit the country’s power sector,” he added.
Source: The Kathmandu Post
