KATHMANDU: Ganesh Karki, President of the Independent Power Producers’ Association Nepal (IPPAN), has warned that private hydropower producers may be forced to halt electricity generation if the government does not reconsider its current energy policy.
Speaking at a discussion on infrastructure and implementation jointly organized by the Society of Infrastructure Journalists and the Federation of Contractors’ Associations of Nepal, Karki criticized the government’s recent approach, claiming it discourages private investment in the hydropower sector.
Karki argued that the government’s decision to adopt a “take-and-pay” model for Power Purchase Agreements (PPAs)—which allows purchases only based on current production and consumption balance—could severely impact the long-term development of the energy sector.
“We are moving forward with the target of generating 28,500 megawatts of electricity, involving both domestic and foreign investment,” he said, warning that current policies suggest the government believes no further hydropower capacity is necessary.
He further questioned the practicality of requiring strict consumption-production balance before signing new PPAs, calling the approach unrealistic.
Karki expressed concern that government thinking seems to confine electricity use to household purposes, pushing industries toward diesel alternatives. “Such a mindset poses a serious threat to long-term energy security,” he said.
He also said the private sector has made significant contributions not only in hydropower generation but also in developing essential infrastructure like roads. “However, the current policy direction appears to sideline the private sector from hydropower development,” he cautioned.
Calling for urgent intervention, Karki urged the government to adopt a long-term, strategic perspective and immediately review its energy policies to ensure sustainable energy security and continued private sector participation.
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