Good initiative

We applaud the leakage control drive of Nepal Electricity Authority (NEA), which has already punished around 20,000 offenders for stealing electricity. This is an important exercise because NEA’s leakage in the form of both thefts and technical losses amount to a whopping 25 to 30 percent. While the mismatch between demand and supply is the prime reason behind the treacherous power cuts that the country has been facing since the past four years to five years, the situation would not have been as bad as it is without such leakage.



To reverse the terrible power situation in the coming years, we not only need to focus on generating more electricity by investing in newer hydropower projects but also need to address this deadly menace. Pilferage and technical losses is resulting in losses of billions of rupees to the state-owned NEA. Energy Minister Gokarna Bista was recently quoted as saying that if NEA can just reduce its leakage by six percentage points, it will generate about 2.5 billion rupees of additional revenue, meaning that it will almost offset its annual loss.



The last annual report of NEA had put its net loss at Rs 5.35 billion that included Rs 3.20 billion paid in interest of long-term loans.

NEA, which has in its drive so far punished only petty offenders, has rightly identified that some of the biggest perpetrators are big industries that have been working hand-in-glove with some of its officials, thus depriving it of valuable revenue. We hope that in the coming days it will make sure to unmask such companies and people and punish them accordingly. Such strong measures are extremely important besides the simultaneous need to focus on power generation.



Nepal’s present power generation capacity stands at a mere 698 MW whereas the peak season demand is nearly 900 MW. A substantial injection of power into the NEA transmission grid is not expected until about another five to six years when big hydro projects such as Upper Tamakoshi and Upper Karnali are expected to be ready. Until then, there are only two ways to prevent the country from plunging into darkness. One, import electricity from India. However, there is only so much that we can rely on import because of the limited capacity of the Nepal-India Electricity Transmission and Trade Project (NIETTP). Thankfully, the World Bank this month approved a loan of about Rs 7 billion to upgrade NIETTP. Yet, this will take a few years before it becomes operational. Until then, we have no other alternative other than focusing strongly on minimizing leakage.

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