Half a dozen suggestions to the government of IPPAN: Eliminate the hassle of forest and border and guarantee a 50-year license (with full text)
निर्माणकै क्रममा आईपीओ जारी गर्न पाउनुपर्ने, ‘वान प्रोजेक्ट, वान फाइल’ लागू गर्न माग
लगानी न्यूज
Kathmandu. The Independent Power Producers’ Association of Nepal (IPPAN) has given more than half a dozen suggestions to the government. In response to the suggestions sought by the government, IPPAN has submitted various suggestions, including the need to amend half a dozen laws.
The Office of the Prime Minister and Council of Ministers had sent a letter to various private sector organizations asking them to give suggestions in the prescribed format. Accordingly, IPPAN has demanded the government to amend half a dozen laws and make policy arrangements.
IPPAN has demanded the government to make comprehensive reforms in various acts, policies, regulations and procedures to solve the existing problems in the energy sector. IPPAN has submitted suggestions to the government ranging from opening the stalled power purchase agreement (PPA) of about 17,000 MW to ending the monopoly of the Nepal Electricity Authority and removing the tendency of getting stuck in the files of the projects.TAG_OPEN_div_80
IPPAN has suggested reforms related to various ministries and government agencies to protect the investment of the private sector in the energy sector and to end the delay in the implementation of the project. The suggestions include removing the hassles related to forest and environment, relaxing the land ceiling, ensuring the validity of the license of hydropower projects for 50 years and implementing a one-door system.
The IPPAN has suggested that the laws and procedures related to the Ministry of Energy, Water Resources and Irrigation, Ministry of Finance, Ministry of Agriculture and Forest, Ministry of Land Management, Ministry of Home Affairs, Securities Board of Nepal, Nepal Rastra Bank and other bodies should be improved.TAG_OPEN_div_76
IPPAN has demanded the Ministry of Energy, Water Resources and Irrigation to make necessary amendments to the Electricity Act, 2049 to ensure transparency in the electricity sector to involve the private sector in electricity trade. IPPAN said that this will help attract huge investment in the energy sector.TAG_OPEN_div_74
{{TAG_OPEN_div_72} The committee has suggested immediately implementing the work procedure related to ‘open access’ and wheeling charge to resolve the problems related to the transmission line and to involve the private sector in the construction of the transmission line.
Similarly, IPPAN has demanded that the PPAs of about 17,000 MW capacity should be opened immediately by taking a decision from the Board of Directors of the Nepal Electricity Authority. It has also suggested that the PPA rate should be revised according to the time by linking it with the price hike, exchange rate and financial cost.TAG_OPEN_div_70
IPPAN has suggested that the validity period of the license of hydropower projects should be fixed at 50 years as per the Act, and if the project is affected due to delay by the government or due to the project beyond the control of the project, the date of power production (RCOD) should be extended automatically.TAG_OPEN_div_68
IPPAN has demanded flexibility in the survey license and power purchase rate for solar projects and the construction of a common transmission line in a single river corridor. IPPAN has demanded to end the monopoly within the Nepal Electricity Authority (NEA) and create separate institutional structures for generation, transmission, distribution and electricity trade.TAG_OPEN_div_66
Similarly, IPPAN has said that the process of Environmental Impact Assessment (EIA) approval should be streamlined to eliminate the delays in the process related to forest and environment. It has suggested that the regulation should be amended to ensure that the power to approve EIA is from the ministerial level or at the secretary level.
IPPAN has also demanded that after the approval of the EIA, there should be an integrated arrangement where the orders for tree felling and land replacement will be automatically received. It has been suggested that the process of taking opinions between the concerned ministries and the Ministry of Environment should be conducted through a one-door system and if the local level or the concerned office does not give the opinion within 15 days, then the agreement should be automatically deemed to have been reached.TAG_OPEN_div_62
IPPAN has also suggested that the EIA process should be integrated into the repetitive stages of public hearings and consultations, that additional clarifications can be sought only once, and that a decision should be made within the stipulated time frame. For minor technical changes to the design or capacity of the project, the requirement of a fully supplementary EIA should be removed and the process can be completed through the amendment of the Environmental Management Plan (EMP).TAG_OPEN_div_60
IPPAN has also demanded different periods of validity of the environmental study as per the nature of the project and to prepare a clear legal basis for the construction of energy infrastructure within the conservation area and national park.TAG_OPEN_div_58
IPPAN has also suggested that the land management system should be improved and there should be no limitation of the Land Act for hydropower and transmission line projects and a special law should be made to open the division of necessary land automatically. IPPAN has also said that the local level should issue a circular to stop the trend of collecting double taxation against the federal law.TAG_OPEN_div_56
The committee has also suggested setting up a ‘special energy fund’ for long-term energy projects with the participation of the government, Nepal Rastra Bank and development partners, continuing the 1 percent customs duty concession and extending the deadline for returning equipment sent abroad for repair by six months.TAG_OPEN_div_54
IPPAN has also urged the government to make arrangement for reconstruction, tax concession and refinancing of projects damaged by natural disasters and to implement hedging mechanism for the management of foreign currency risk.TAG_OPEN_div_52
IPPAN has demanded that the Securities Board of Nepal (SEBON) should maintain the previous provision of issuing ordinary shares (IPO) during the construction period after 50 percent physical progress of the project. It has also suggested that the procedure for issuance of right shares and debenture÷bonds should be approved soon.TAG_OPEN_div_50
Similarly, the Ministry of Home Affairs and Defense have been advised to formulate necessary policies for the safety of projects, dams and transmission lines in remote areas and remove procedural hassles in the import, transportation and use of explosives required for construction. IPPAN has demanded that the duration of the NOC required for explosives should be kept at least one year.
IPPAN has said that the ‘One Project, One File’ or one-door system should be implemented to end the situation of carrying files of the same project in different government agencies. IPPAN has also suggested that if the decision is not taken by the concerned body within the stipulated time, then the legal provision should be made to be considered as automatic approval.TAG_OPEN_div_46
IPPAN has come up with these proposals after the government sought suggestions from the private sector on the reforms to be made in the existing laws. The government had sent a letter to 21 various private sector organizations on September 18, asking them to give suggestions in the prescribed format for necessary reforms in the existing Acts, Rules and Procedures that have been hampering the industry and commerce.TAG_OPEN_div_44
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