Power Purchase Agreement (PPA) with seven hydropower projects with combined installed capacity of 101 MW has been stalled in lack of board meeting of the Nepal Electricity Authority (NEA) for a long time.
Promoters and NEA officials have already agreed on PPAs and sent them to the board for final approval. The PPA proposals have to be taken to the NEA board after being approved by the managing director (MD). The board has yet to decide on 38 issues including PPA, dispute with contractors and claims for compensation. But board meeting of NEA has not been convened for a long time. It has been convened only once after March and has not taken any decision apart from extending deadline of Upper Trishuli 3A.
PPAs of Darbang Myagdi (25 MW), Upper Khorangkhola (7.5 MW), Rudikhola (6.6 MW), Lower Hewakhola (21.6 MW), Ludi Sanakhola (750 KW), Open River Tacardo (400 KW) have been stalled. Promoters of these projects are Dhaulagiri Kalika Hydropower, Tehrathum Power Company, Bindhyabasini Hydropower Development Company, Ludi Hydropower Development Company, Asmita Hydropower Company and Mountain Hydro Nepal respectively. Similarly, PPA for the increased 15 MW of Khanikhola Hydropower Project in Dolakha has also been affected. Promoter Green Life Energy had increased capacity of the project to 40 MW from 25 MW.
Board meeting could not be held initially following rumors about change of secretary at the Energy Ministry after Radha Gyawali became minister. Board meeting has been stopped due to various reasons even after that. Secretary Rajendra Kishor Chhetri only assumed office on May 15 after he was transferred by the cabinet. Minister Gyawali is chairperson of NEA. The government had removed the then directors Laxman Agrawal, Vivek Tated and Manoj Mishra who had moved the Supreme Court for reinstatement claiming they were removed though their term had not expired. Board meeting of NEA has become uncertain after the court issued interim order in favor of the trio. Though the court verdict on the issue was expected to come on Tuesday, hearing has again been postponed by a week.
Promoters can make financial arrangements and get generation license from the ministry only after PPA is signed. NEA has been signing PPA at a single rate with promoters of projects up to 25 MW. It has fixed a rate of Rs 4.80 per unit for eight months during rainy season and Rs 8.40 for the remaining four dry months. PPA for bigger projects is signed as per mutual agreement with the promoters. NEA has also initiated discussions to pay a single rate even for projects bigger than 25 MW.