MoE bid to save Kabeli licence

- SANJEEV GIRI, Kathmandu

Jan 23, 2015-

The Ministry of Energy (MoE) is all set to propose to the Cabinet to save the licence of the Kabeli hydropower project whose financial closure has recently been completed.

The planned 37.6 MW project is one of the 14 projects whose permits the Commission for the Investigation of Abuse of Authority (CIAA) had ordered be cancelled for failure to complete paperwork.

The government is keen to save its licence as it is being financed by the World Bank. The MoE has recently cancelled the licences of the 13 other projects.

The anti-graft body had directed the ministry to scrap their licences as they had failed to complete the financial closure and the power purchase agreement (PPA) within the timeframe specified in their license agreements. Kabeli concluded the financial closure after the CIAA had issued its cancellation order.

Energy Secretary Rajendra Kishore Kshatri submitted the proposal to be tabled at the Cabinet to Energy Minister Radha Gyawali on Friday. “The Kabeli-A is different from the other projects,” Kshatri said. “I have submitted a proposal to the minister for her to take the matter to the cabinet. The rest will depend on her decision.”

The MoE is of the view that the Kabeli-A project should be given a second chance since the project was handed over to private sector developer Butwal Power Company Limited (BPCL) through international competitive bidding.

Since the government was involved in securing funding from the World Bank for the project, Kshatri said that that government could not treat this project like the 13 other projects whose licences have been scrapped.

Last November, the government and the World Bank signed a $46 million loan and grant agreement for the Kabeli-A project. With this credit deal, the CIAA’s concern regarding the project has been addressed, according to the MoE. Of the total funding agreed, $40 million is loan and $6 million is grant.

After a long controversy regarding the CIAA’s jurisdiction, the parliamentary Agriculture and Water Resources Committee (AWRC) on December 17 had directed the ministry to decide the fate of the 14 hydropower projects.

The CIAA’s Acting Secretary Prem Kumar Rai had told the AWRC that the anti-graft body had relaxed its directive on the 14 projects allowing the government to make the decision itself.

However, the energy secretary had time and again told the parliamentary committee that the CIAA’s directive to the MoE was obligatory and hence he was not in a position to disregard it.

The Electricity Act 1992 has given the final authority of issuing or scrapping licences to the energy secretary. “Since this is a special issue, we are planning to take it to the Cabinet,” Kshatri said. The CIAA cannot override the Cabinet’s decision. Gyawali has said during several public speeches that she will save good projects even if she has to appeal to the Cabinet.

Published: 24-01-2015 09:24

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