NEA projects Rs. 1.1 bn profit in 2017/18

Kathmandu, Aug. 14: Nepal Electricity Authority (NEA) has projected that its net profit in the last fiscal year 2017/18 would stand at Rs. 1.1 billion against the Rs. 2.50 billion loss estimates.

The NEA has earned Rs. 60.48 billion from the electricity supply and interest earnings in the last fiscal year which is Rs. 8.78 billion higher than the FY 2015/16.

“NEA made Rs. 7.86 billion in the last fiscal, and we hope that the net profit will go even up after the final audit of the income and expenditure of the organisation. The end of load shedding and efficient use of electricity projects under NEA-ownership have contributed to the increased income,” said Kulman Ghishing, Executive Director of the electricity monopoly in the country.

With the uninterrupted power supply, urban businesses and large industrial and business institutions are also earning more profits.

Ghishing said that the NEA had projected that it would witness Rs. 2.5 billion net loss in the last fiscal but the initiatives launched for administrative and financial reforms at the government-run power monopoly had resulted in profits.

“The NEA was in the loss of Rs. 8.89 billion annually. With the support from the prime minister, energy minister, secretary and NEA Board of Directors, staffs and consumers we were successful to increase income and earn profits. But there is more to do,” he said.

According to him, success in curbing the leakage of electricity, energy import from India, reduction in the average purchase rate in buying electricity from the Independent Power Producers (IPPs), end of load shedding, implementation of financial restructuring at the NEA and control in administrative expenditure were the major reasons behind the increasing profits.

The power monopoly earned Rs. 4 billion from the leakage control in the last FY.

It earned Rs. 1.51 billion in the FY 2016/17. However, it is under the accumulated loss of Rs. 28.12 billion.

Ghishing expressed hope that the completion of 14 megawatt Kulekhani III, 60 mw Upper Trishuli 3A and 456 mw Upper Tamakoshi will deliver more profits, and the NEA will have enough resources to make investments in the power projects that NEA subsidiaries are carrying out.

He said that the country will continue to import energy from India as the domestic production was not sufficient to meet the overall demand in the dry season, and the average purchase rate of Indian electricity is Rs. 7.47 per unit which is less than the IPPs Rs. 8.40 per unit.

NEA sells the electricity to its customers at the rate of Rs. 10.4.

Published in The Rising Nepal daily on 15 August 2018.