KATHMANDU: Energy entrepreneurs have issued a final warning to lawmakers, urging the removal of the controversial ‘take-and-pay’ clause in the electricity purchase agreement (PPA) provisioned in the new fiscal budget.
On the day the budget is expected to be passed by Parliament, private sector power producers sent a mass SMS to chief whips of all major political parties expressing strong opposition to the policy.
According to Mohan Kumar Dangi, senior vice president of the Independent Power Producers’ Association of Nepal (IPPAN) and coordinator of the protest committee, the message was sent to the chief whips of Nepali Congress, CPN-UML, CPN (Maoist Centre), Rastriya Swatantra Party, Rastriya Prajatantra Party, CPN (Unified Socialist), and Janata Samajbadi Party.
In the SMS, the entrepreneurs wrote: “Repeal the ‘take-and-pay’ PPA that destroys private investment in the energy sector, invites a return to load-shedding, bankrupts investors, and cripples the national economy.”
The budget announced on May 29 stated that electricity purchase agreements for run-of-river (RoR) hydropower projects would follow the ‘take-and-pay’ model.
IPPAN and other energy stakeholders have opposed this clause from the beginning, arguing it undermines private investment, discourages future projects, and risks creating an unstable energy supply.
Following what they describe as the government’s indifference to their concerns, the entrepreneurs have been staging protests since June 20.
On that day, they submitted a memorandum to Prime Minister KP Sharma Oli, and on June 21, they sent similar SMS messages to PM Oli, Deputy Prime Minister and Finance Minister Bishnu Paudel, Energy Minister Deepak Khadka, and Nepal Electricity Authority (NEA) Executive Director Hitendra Dev Shakya.
On June 22, the entire energy entrepreneur community took to social media, posting black banners calling for the removal of the take-and-pay provision.
Despite reports that Energy Minister Deepak Khadka, along with key political leaders including Prime Minister Oli and Nepali Congress President Sher Bahadur Deuba, have agreed to amend the provision, IPPAN said it is continuing its peaceful protests as planned.
Sending SMS to chief whips on the final day of budget approval, they said, was a reminder that the private energy sector will not back down until the controversial clause is removed.
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