The Nepal Electricity Authority (NEA) has restored power supply to the defaulting industries upon the directive of the Council of Ministers but it seems likely that the power utility will face uphill battle to collect the outstanding dues of the dedicated feeders and trunk lines.
Industrialists insist that the NEA should issue a revised bill based on Time of Day (TOD) meter data to verify the exact periods of electricity supply, arguing that arrears should only be paid once this recalculated bill is issued. The NEA, however, maintains that the existing bill is accurate and was prepared using TOD meter data, refusing to issue a new one. This ongoing standoff suggests it will be difficult to recover the dues within the 15-day deadline set by the Council of Ministers.
An emergency meeting of the Council of Ministers on Sunday decided to restore electricity within 24 hours to industries with outstanding dues and mandated the NEA to collect arrears from industrialists within 15 days. Following a board decision on Tuesday, the NEA reconnected power as instructed by the government. NEA Executive Director Kulman Ghising has warned that if payments are not made within the 15-day timeframe, power supply will be disconnected again.
“If the industrialists do not pay the arrears within the stipulated 15 days, we will disconnect the lines once more,” Ghising stated at a press conference on Wednesday, adding that this cycle of disconnection and reconnection has persisted for years and that the dispute must now be settled.
On October 24, the NEA had cut power supply to 34 industries for failing to pay their arrears. This prompted 14 of them to start paying in installments. Ghising criticized government intervention, suggesting it prolonged the dispute by allowing reconnections for industries that had just started making payments. He emphasized that if industrialists do not clear the dues within 15 days, the Ministry of Energy and the government should take further steps to collect the outstanding amounts.
The NEA is seeking to recover Rs 8.4 billion in arrears, including penalties, covering the period from mid-January 2016 to mid-May 2018. This figure was calculated based on recommendations by a commission led by former Supreme Court Justice Girish Chandra Lal, which advised that dues outside this period should not be collected. However, 28 industrialists have refused to pay, disputing the NEA’s billing for this period. They argue that the recalculation should include discounted rates according to the dedicated feeder and trunk line standards, accounting for specific days and periods of supply.
According to Nepal Cement Manufacturers Association President Raghunandan Maru, NEA should follow the Lal Commission’s recommendation to use TOD meter data for recalculating the arrears and apply a discounted tariff. The recently published report suggests that tariffs for the disputed period should align with dedicated feeder and trunk line standards, taking into account actual days and periods of supply.
Power Reconnection to 28 Industries
Following the government’s directive, the NEA reconnected power to 28 industries with arrears. NEA spokesperson Chandan Kumar Ghosh confirmed that lines to all affected industries were restored by Wednesday night. Initially, the NEA had disconnected power to 34 industries on October 24 due to unpaid dues, but six industries paid their first installment after receiving notice, avoiding disconnection. Meanwhile, NEA could not disconnect power to Hetauda Cement, Udayapur Cement, and seven private industries due to ongoing court cases.
