NEA chief exec to be appointed through free competition
KATHMANDU, MAY 08 -
Breaking away from the tradition, chief executive of the Nepal Electricity Authority (NEA) will now be appointed through a free competition.
Indicating reform at NEA that has been marred by corruption, the government on Friday took a decision in this regard. The government also relieved NEA’s current chief Jivendra Jha of the post of managing director.
A couple of weeks after assuming the responsibility of the Ministry of Energy, Minister Gokarna Bista said NEA’s chief would be appointed through free competition. “The idea is to have a competent person to run the NEA,” said Bista.
So far, NEA’s chief used to be appointed through a Cabinet decision following the recommendation of energy minister. Jha was appointed NEA chief by the then energy minister Prakash Saran Mahat.
According to Bista, energy ministry will publish a vacancy for the NEA chief after the terms of reference (ToR) is finalised. “The ministry will soon draft the TOR,” said Minister Bista. “A team led by the energy secretary will prepare the TOR.”
Former NEA chairman Bhola Chalise welcomed the government move. However, he said, “As long as energy minister remains NEA board chairman, it will not make a huge difference.” So far, energy minister becomes chairman of the NEA board.
Minister Bista said he will amend the laws to break away with the tradition of Energy Minister becoming chairman of the NEA board.
An NEA report compiled last year had also recommended structural restructuring in three levels-the government, board and management. The report had said the government must formulate a master plan for electricity generation, transmission and distribution and assign a clear role to NEA. It had proposed that the NEA board should be restructured under which a managing director should be appointed for a fixed term through competition.
The government move has come at a time when NEA, the sole entity responsible for transmission and distribution of electricity in the country, is facing huge financial crisis. It is even struggling to pay bills of electricity import from India, repair transformers and settle dues of contractors. Such is the situation that it recently had asked the finance ministry to provide Rs 1.5 billion.
Huge and persistent system losses, overstaffing, towering overheads and political interference have turned NEA in to a loss making state-owned enterprise. Its accumulated loss is over Rs 19 billion.
With the power tariff remaining same for the last nine years, NEA is incurring monthly losses of Rs 250 million. According to an NEA official, its average power procurement cost stands at Rs 8.97, whereas it sells electricity at Rs 6.57 per unit on an average.
Chalise says restructuring NEA is the only option the government currently has. “Electricity distribution and generation should be handed over to the private sector and NEA should look after the transmission job,” said Chalise.
Source: Kantipur
Breaking away from the tradition, chief executive of the Nepal Electricity Authority (NEA) will now be appointed through a free competition.
Indicating reform at NEA that has been marred by corruption, the government on Friday took a decision in this regard. The government also relieved NEA’s current chief Jivendra Jha of the post of managing director.
A couple of weeks after assuming the responsibility of the Ministry of Energy, Minister Gokarna Bista said NEA’s chief would be appointed through free competition. “The idea is to have a competent person to run the NEA,” said Bista.
So far, NEA’s chief used to be appointed through a Cabinet decision following the recommendation of energy minister. Jha was appointed NEA chief by the then energy minister Prakash Saran Mahat.
According to Bista, energy ministry will publish a vacancy for the NEA chief after the terms of reference (ToR) is finalised. “The ministry will soon draft the TOR,” said Minister Bista. “A team led by the energy secretary will prepare the TOR.”
Former NEA chairman Bhola Chalise welcomed the government move. However, he said, “As long as energy minister remains NEA board chairman, it will not make a huge difference.” So far, energy minister becomes chairman of the NEA board.
Minister Bista said he will amend the laws to break away with the tradition of Energy Minister becoming chairman of the NEA board.
An NEA report compiled last year had also recommended structural restructuring in three levels-the government, board and management. The report had said the government must formulate a master plan for electricity generation, transmission and distribution and assign a clear role to NEA. It had proposed that the NEA board should be restructured under which a managing director should be appointed for a fixed term through competition.
The government move has come at a time when NEA, the sole entity responsible for transmission and distribution of electricity in the country, is facing huge financial crisis. It is even struggling to pay bills of electricity import from India, repair transformers and settle dues of contractors. Such is the situation that it recently had asked the finance ministry to provide Rs 1.5 billion.
Huge and persistent system losses, overstaffing, towering overheads and political interference have turned NEA in to a loss making state-owned enterprise. Its accumulated loss is over Rs 19 billion.
With the power tariff remaining same for the last nine years, NEA is incurring monthly losses of Rs 250 million. According to an NEA official, its average power procurement cost stands at Rs 8.97, whereas it sells electricity at Rs 6.57 per unit on an average.
Chalise says restructuring NEA is the only option the government currently has. “Electricity distribution and generation should be handed over to the private sector and NEA should look after the transmission job,” said Chalise.
Source: Kantipur
