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Kathmandu Friday July 21, 2000 Sharawan 06, 2057.
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House stalled again over electricity rate
By a Post Reporter
KATHMANDU, July 20 - For the second day, the main opposition
CPN-UML and other opposition parties stalled the House of Representatives proceeding today
demanding the details on the loan signed with Asian Development Bank (ADB) that could lead
to hike in electricity tariff.
Despite marathon talks between the government and the opposition parties, the two sides
failed to reach agreement and when the House did convene at around 2:30 pm, opposition
lawmakers stormed the front of the assembly hall and gheraoed the Speaker.
Speaker Taranath Ranabhat adjourned the meeting to resume again on Monday afternoon giving
time for negotiations.
Talks between the two sides had begun in the morning and had
almost reached an agreement when Minister for Water Resources Khum Bahadur Khadka agreed
to pledge in the House that the electricity tariff would not be hiked immediately.
However, the truce broke after Finance Minister Mahesh Acharya reportedly refused to give
copies of the agreement saying that since the government signs many of these types of
agreements it was not possible to hand out each of them to all the members every time.
Minister Khadka during a program outside the capital city on Wednesday had already
announced that the government had no immediate plans to increase the tariff.
However, Minister of State for Water Resources Ram Bahadur Gurung -- at around the same
time -- admitted at the Parliament that the ADB had called for "adjustment" of
the tariff if necessary to meet the figures set by it, make necessary changes in the
Electricity Tariff Fixation Regulations and get the Electricity Leakage Control Bill
through the Parliament at the earliest.
The main opposition CPN-UML and other opposition parties are demanding the government
provide details of the agreement that according to the Nepal Electricity Authority (NEA)
could soon hike the price of electricity up to 30 percent to meet the loan conditions set
by ADB.
Representatives of ADB and the Finance Ministry had signed a US dollar 50 million (around
Rs 3.5 billion) loan last week to fund rural electrification and power sector reform
programs under the government's Eighth Power Project.
When the ADB loan was sanctioned over two years back, the lending agency had demanded that
the Self Financing Ratio (SFR) be 23 percent compared to the 13 percent at present and
Rate of Return (RoR) to 6 percent which is 2 percent at present. According to NEA, this
would have calculated the price of electricity to be hiked by 60 percent.
Last year, the government hiked the price of electricity up to 30 percent (25 percent for
Industrial purposes and 30 percent for general consumers). At present, a unit of
electricity costs Rs. 6.50 on an average which, even by official admission, makes Nepal's
price the costliest in South Asia and among the costliest in the world.
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