November 22: The private sector of Nepal has the potential to consume an additional 5,000 MW of electricity in the next three years provided that the transmission and distribution system is managed reliably.

Nepal Electricity Authority (NEA) has been complaining about electricity wastage for a while and is also taking necessary initiative to resolve this problem. Electricity consumption has not increased as expected. However, the private sector seems optimistic. It is taking initiative for the development and improvement of the distribution and transmission systems.

According to an unofficial study by the Independent Power Producers’ Association of Nepal (IPPAN), an additional 2,000 megawatts of electricity could be consumed for cooking purposes in urban areas, 1,000 megawatts in the transport sector, and 2,000 megawatts in the industrial sector if the distribution system is improved.

If the NEA brings effective marketing and subsidy programmes, the use of electric stoves will widely increase. Ashish Garg, the vice-chairman of IPPAN, stated that 3,000 MW of electricity could be consumed within three years if the capacity of transformers and other technical capabilities were expanded by giving priority only to urban and developing areas.

The price of cooking gas (LPG) is constantly rising. General changes in the price of LPG in the international market also affect Nepal. At present, the price of a cylinder of cooking gas is Rs 1,575. According to Garg, it has become a necessity to use induction cookers as the prices increase every year. For this to happen, he said the government should intervene at the policy level and bring promotional programmes including grants.

Arguing that if the subsidy is provided for induction stoves, Garg said qualitative change will be seen within a year. He added that joint effort of the government and private sector is necessary to this end. According to the Nepal Oil Corporation, LPG worth Rs 40 billion is imported annually. Imports are likely to increase further this year.

Similarly, the construction of adequate charging stations and banning the import of petrol and diesel vehicles by the government will increase the use of electric vehicles. In such scenario, an additional 1,000 MW of electricity will be consumed in the next three years. The private sector has also been demanding necessary laws to allow them build charging stations. If there is no obstruction, a charging station can be built just like a petrol pump. Out of a total of 1 million vehicles operating in Nepal, only around 10,000 are electric vehicles.

IPPAN is of the view that if the public sector adopts a policy of importing only electric vehicles, it will have an impact on the market and the private sector will be obliged to promote electric vehicles. The last time when NEA provided 30 MW of electricity to Hongshi Cement Industry, it had a positive impact on other industries as well. The industry has demanded an additional 50 MW of electricity. Similarly, industrialists and businessmen have immediately demanded 1,000 megawatts of electricity.

According to the Department of Customs, 400,000 tons of coal is being imported annually. An additional 1,000 megawatts of electricity is needed to stop the import of coal for use in the cement industry alone. On this basis, the demand for 5,000 to 7,000 MW of electricity is likely to increase in the system, said Garg.

He presented this statement on the occasion of IPPAN's annual general meeting. Commenting on the details, Minister for Energy, Water Resources and Irrigation, Pampha Bhusal said that the government is committed to increase the consumption of electricity in every sector. As the chairperson of the board of directors, she said that she is ready to carry out all the works on behalf of NEA in a planned manner.

She also urged the private sector to support the government's efforts. She further said that electricity is also a raw material and should be properly consumed within the country.