NEA to sign PPA with six projects at revised rate
KATHMANDU, JAN 14 -
The government has directed the Nepal Electricity Authority (NEA) to sign the Power Purchase Agreement (PPA) with six hydropower projects at recently revised rate.
The projects are Solu (23 MW), Lower Solu (82 MW), Maya Khola (15 MW), Khare (24 MW), Mewa Khola (50 MW) and Singati (16 MW).
NEA in June 2011 had increased the PPA rate by 20 percent for projects having capacities less than 25MW. As per the new rate, hydropower developers will get Rs 8.40 per unit during summer and Rs 4.80 per unit during rainy season. Earlier, the rate was at Rs 7 per unit during summer and Rs 4 per unit during rainy season.
“After the ministry’s direction, NEA is now making preparations for signing PPA with the projects at the new rate,” said Energy Ministry Secretary Balananda Poudel, who is also the chairman of NEA.
According to ministry officials, signing of the agreement was delayed after NEA expressed reluctance to purchase power with these projects at the revised rate. The confusion had emerged due to the term ‘posted rate’ mentioned in the bid documents, which the developers defined as the new rate. “But NEA defined it as the old rate,” said Rajendra Chettri, joint secretary at the ministry.
In order to resolve the confusion, the ministry had formed a technical committee a month ago to recommend appropriate rate. “On the basis of the committee’s recommendation, the ministry instructed NEA to sign the agreement at the new rate,” said Chettri. NEA officials said the agreement will be signed soon. “We have prepared the agreement model and called the developers for the signing,” said an NEA source.
As per a recent survey, construction of these projects will cost around Rs 35 billion and they will have installed capacity of 210 MW. Independent Power Producers had long been demanding a PPA rate hike. With rising construction cost and high bank rates, several hydel projects having a collective capacity of 1500 MW have been reluctant to sign PPA.
Source: Kantipur
