ERC Enforces Open Access Policy to Maximise Power Infrastructure Use

The Electricity Regulatory Commission (ERC) has enforced the "Directive on Open Access in Electricity Transmission and Distribution, 2082", aiming to maximise the use of the country’s transmission and distribution infrastructure.

Under the new rules, non-discriminatory access to transmission and distribution networks will be available to power projects of 5 MW or above connected at 33 kV or higher voltage levels, captive power plants with a minimum capacity of 1 MW, and industrial and commercial consumers with a load of 5 MW or more. For cross-border electricity trade, a minimum capacity of 10 MW has been made mandatory.

The directive categorises open access into long-term, medium-term and short-term arrangements. Long-term access is granted for periods exceeding five years, medium-term for more than one year up to five years, and short-term from a minimum of 24 hours up to one year. Long-term access will be given first priority.

The System Operation Department of the Nepal Electricity Authority (NEA) has been designated as the nodal agency to receive applications, complete procedural requirements and provide open access services.

Open access users will be required to pay applicable charges based on usage. These include transmission and wheeling charges, deviation settlement charges, cross-subsidy charges, additional surcharges, standby charges, reactive energy charges, scheduling charges and operational charges. However, not all charges will apply to every user. The commission may revise tariff rates from time to time.

For long-term open access, users may also be required to contribute to the cost of upgrading and strengthening transmission and distribution infrastructure. The nodal agency has been authorised to prepare detailed operating procedures and develop a standard open access agreement between licence holders and customers.

The directive also establishes a grievance redress mechanism. Complaints can be filed with the “Open Access Grievance Redressal Committee”. Parties dissatisfied with its decision may approach the commission for dispute resolution.

According to the ERC, the introduction of open access is expected to improve transmission capacity utilisation, boost private sector participation and allow power producers to directly access markets. It is also expected to provide a clearer regulatory framework for domestic and cross-border electricity trade.

At a time when challenges in power purchase and sales risk delaying projects, the commission believes the policy will help link power generation with potential markets. In the long term, it is expected to enhance system efficiency and lay the foundation for a competitive electricity market, where consumers may eventually be able to choose their suppliers.