Electricity Crisis in Nepal

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Electricity Crisis in Nepal

“Not a day goes by without a few hours of power cuts. Load shedding has now become a perennial problem and it is here to stay."

The story of power position in Nepal is that of highest potential and lowest consumption. The electricity demand in Nepal is increasing by about 10 percent every year and close to 40 percent of the approximate Nepalese population has access to electricity so far. The main load centre is the central zone which includes the Kathmandu Valley. Nepal owns a number of hydropower plants with average total installed capacity of around 650 MW which includes several small and medium hydropower plants.

The hydropower development in Nepal began with the development of 500 kW Pharping Power Plant in 1911. Some of the other major hydro power plants in Nepal can be listed as: Trishuli, Sunkoshi, Gandaki, Kulekhani II, Marshyangdi, Puwa, Modi, Kaligandaki, Andhikhola, Jhimruk, Khimti, Bhotekoshi Indrawati Syange, Chilime, Piluwa, Sunkoshi etc.

.Until 1990, hydropower development was under the domain of government utility, Nepal Electricity Authority (NEA) only. However, with the enactment of new Hydropower Development Policy 1992, the sector was opened to the private sector also. There are number of projects already built by the private developers. Private power producers contribute 148 MW of power to the ‘Integrated Nepal Power System'.

Demand and Supply of Electricity:
The demand for electricity is currently around 1200 MW but the production in the rainy season is 750 MW only and in the dry season it is around 450 MW which includes total NEA production from hydro and thermal, purchase from the private sector, and import from India. Of the total availability, NEA supplies 55 per cent (including both hydro and thermal), private sector contributes 27 per cent, and 18 per cent is imported from India.

In addition, the gap between supply and demand of electricity is increasing every year, as the demand is growing with more than 7% annually while hardly any new power plants are being commissioned. The hydropower generation potential of Nepal is estimated at 83,000 Mega Watts (MW) among which 42,000 MW is a commercially viable capacity. At present mere 0.75 per cent (i.e., 650 MW) of its total generation capacity is exploited.

O
Shortage
D
S
Quantity of Electricity
Price of electricity
Eq
Qe
P
P0
Q0
Q1
Y
X

There is a huge power demand-supply imbalance which is evident from load shedding implemented over the last several years now. At present, Nepal Electricity Authority (NEA) is supply -deficit. While the peak power demand in wet season was more or less met by the supply but until few years Nepalese people experience power cuts also in the wet season, the deficit during the dry season is very high resulting in power outage for as much as 16 hours a day in the capital itself. In order to overcome the shortage, the Government along with the private sectors should take initiatives in investment in this sector. There are no quick fixes to our power crisis unless production catches up with soaring demand.

Having immense potential of hydropower development, it is important for Nepal to increase its energy dependency on electricity with hydropower development. This contributes to elimination of deforestation, soil erosion and depletion, and increased flooding downstream. Shortage of wood also pushes farmers to burn animal dung, which is needed for agriculture. Not only this, the development of hydropower will help to achieve the millennium development goals with protecting environment, increasing literacy, improving health of children and women with better energy. Growing environmental degradation adds a sense of urgency. The major impact of power outage is on industry as it needs 1,100 gigawatt hours (GWh) of energy for the industrial sector which is about 40 per cent of the total electricity produced by NEA. It has close to 1.77 million...
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