Load shedding hurts business

KATHMANDU, DEC 10: 

An increase in the load shedding by an hour adds hugely to the cost of doing business as they require 71 kilolitres (kl) of diesel per hour in aggregate, according to industrialists.

Currently, there is need for 142 kl of diesel per hour to meet energy demand, said member of Federation of Nepalese Chambers of Commerce and Industry Gyanendra Lal Pradhan. Out of the total demand, the industrial sector uses 50 per cent, which is around 71 kl.

The general public do not use diesel for electricity, he said, adding that they either use inverters or some other alternatives. The production cost of industries goes up due to the extra diesel required, he added. 

Nepal Oil Corporation (NOC) has said that monthly consumption of diesel stands at 65,000 kl. “However, the real consumption of diesel is some 50,000 kilolitres,” said director of NOC Shiva Prasad Pudasaini.

Out of the total consumption, 11,000 kl diesel is being used to generate electricity due to massive power outage in the winter months, Pradhan added. The demand for diesel to generate electricity goes up once load shedding hours increase. The use of diesel to generate electricity will go up to 25,000 kl during the peak load shedding season, that is, winter season.

According to the central bank report, industries have not able to utilise half their production capacity in the last fiscal year due to rising cost of operations, coupled with frequent labour strikes. “The industries were able to utilise only 58 per cent of their capacity in the last fiscal year, though industrial lending has also increased by 16 per cent,” it added.

Meanwhile, industries and transport sector have been facing short supply of diesel due to an increase in demand and decrease in import due to the ongoing renovation of Raxaul depot of Indian Oil Corporation.

Demand has increased due to load shedding, said Pudasaini, adding NOC has asked transporters to divert extra vehicles to Barauni depot until renovation at Raxaul depot is completed. The supply is expected to be normal within a week, he said. “Tankers have already started loading fuel at Barauni.”

Source: THT