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Govt preparing to set up energy regulatory body

- BIBEK SUBEDI, Kathmandu
The body will establish a code that various entities under its jurisdiction will have to follow such as specifying standards for the construction of hydropower plants, transmission lines and distribution networks

Mar 22, 2018-The Energy Ministry has been making preparations to establish the Nepal Electricity Regulatory Commission (NERC), a powerful body to regulate the country’s energy sector. The NERC will set standards to regulate organisations involved in power generation, transmission, distribution and trade.

The process of setting up the NERC’s secretariat and hiring staff including the chairman and members will begin within a month, the ministry said. The Energy Ministry has sent a draft of the Electricity Regulatory Commission Regulation to the Law Ministry for its inputs.

“We have been informed that the Law Ministry will approve the draft within a week,” said Dinesh Kumar Ghimire, spokesperson for the Energy Ministry. “Once we get its consent, we will forward the draft to the Cabinet for final approval.”

The ministry will be able to create the secretariat of the powerful commission and start hiring the required human resources within a month, according to Ghimire.

Newly appointed Energy Minister Barsha Man Pun said there would be no further delays in establishing the commission. Pun said Tuesday that the ministry would expedite the process to set up the commission.

Although the plan to form the NERC had been floated a decade ago, Parliament only endorsed the Electricity Regulatory Commission Act in August 2017, paving the way for its establishment. President Bidya Devi Bhandari signed the bill into law within 91 days as provisioned in the draft.

However, the ministry delayed the process of establishing the commission as a new government was in the offing, and senior officials of the Energy Ministry wanted to wait until the new administration was sworn in.

According to reliable sources at the ministry, Pun has been pressing officials to rush the establishment of the NERC after assuming office.

The NERC will supersede the existing Electricity Tariff Fixation Commission and fix the charges that customers will have to pay to the Nepal Electricity Authority (NEA), the state-owned power utility. The commission will fix the electricity tariff after holding a public hearing.

The commission, according to the regulation, will also establish a code that various entities under its jurisdiction will have to follow.

The code will specify standards for the construction of hydropower plants, transmission lines and distribution networks. It will also determine the voltage that will be supplied to customers by the utility.

The commission will even have a full mandate to determine the power purchase rate for the state-owned power utility. Currently, the NEA is the sole buyer of electricity in Nepal, and it has been fixing the rate for purchase of electricity from hydropower project developers.

Published: 22-03-2018 08:25

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