India to help Nepal set up power trading entity

Nov 18, 2008 - Asia Pulse Data Source

India has entered into an agreement with Nepal to help it set up a power trading entity, which the Himalayan nation has asked for to be able to export power, on the lines of Power Trading Corporation of India.

"An agreement has been reached....India will have a 30 per cent equity stake while the rest will be owned by Nepal," Minister of state for Power Jairam Ramesh told PTI here.

Ramesh and Nepalese Water Resources and Power Minister Bishnu Paudel had met here last week to discuss various issues of mutual interest.

"The Nepalese minister told me that his government wants to end the monopoly of Nepal Electricity Authority by setting up a Nepal Electricity Regulatory Commission under a new law.... It is what we did here by enacting the Electricity Act of 2003," he said.

Ramesh said by setting up an electricity regulator, Nepal wants to introduce competition in the power sector and boost the confidence of investors.

With Nepal set to become a power exporting country by 2013, India has decided to convert power transmission lines between the two countries from the present 66 KW and 132 KW to 400 KV.

"While today Nepal is buying power from India, by 2013, it would be India which would purchase electricity from Nepal," said Ramesh, adding that the transmission line improvement project will be implemented in the next two years at a cost of Rs 200 crore.

The new 400 KW transmission line would be set up between Muzzafarpur in Bihar to Dherkabar in Nepal covering a distance of 160 KM. India and Nepal also reviewed the progress of the 750 MW West Seti hydro electric project, which is in advanced stage of planning.

As part of the project, India will buy the entire 750 MW of power. The project is being promoted by an Australian company and the Asian Development Bank has expressed desire to fund the loan component, Ramesh explained.

PTC India Ltd (PTC), a leading provider of power trading solutions in India, is a government of India initiated Public-Private Partnership, whose primary focus is to develop a commercially vibrant power market in the country.

Nepal Electricity Authority (NEA) was created on August 16, 1985, under the Nepal Electricity Authority Act of 1984, through the merger of the Department of Electricity of Ministry of Water Resources, Nepal Electricity Corporation and related Development Boards.

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