A dire disconnect
A major hydropower aid should have been good news now; it’s instead pitted one government agency against the other
When a recent cabinet decision made officials at the environment ministry smile, those at the energy ministry were left with long faces.
The Alternative Energy Promotion Centre (AEPC) under the environment ministry has been allowed to help build power plants up to 10 Mega Watts, up from the previous ceiling of one MW.
The AEPC had long wanted that to happen while the energy ministry was never happy about the idea. It had even stated its disagreement in black and white several times.
Its officials aggressively argue that the AEPC does not have the capacity to build hydropower plants of that size and that it is not its business.
“There is already an existing mechanism for the job: the energy ministry and the department of electricity development under it are the responsible agencies,” said a senior official with the energy ministry. “So why do you need to have yet another agency for the same work?”
Slings and arrows have been hurled at the AEPC. “We are talking about an organisation that heavily depends on subsidies from the tight-fisted finance ministry and all of its projects are donor-driven,” energy ministry officials say.
“The moment the subsidies and donors’ money stop coming, the AEPC will not even have chairs and tables in its office.”
Credited for significant achievements in alternative energies like biogas and solar photo voltaic, the AEPC however had not been able to do much when it came to building hydroelectric plants above 500 Kilo Watt.
Its officials readily admit that shortcoming. But they also have a rejoinder for the energy ministry and the department of electricity development.
“Those who question our capacity should ask themselves first what they could do in the last 20 years ever since the power sector was liberalised and the doors were open for the private sector,” says Narayan Prasad Chaulagain, executive director at the AEPC.
Indeed, both the energy ministry and the department under it have been widely criticised for not being able to do anything despite the deepening
power crisis.
The department, for instance, has given out nearly 500 survey licenses for power generation from hydropower plants ranging from one to 10 MW.
The total installed capacity of these 500 projects is nearly 2400 MW. And if only one third of these were actually built, the country perhaps would not have any load-shedding today.
So, would the AEPC be able to do what the energy ministry and the department has largely failed to, so far?
It can well argue that community mobilisation is its stronghold—as it has in case of biogas and solar power projects—unlike the DoED’s dependence on the private sector.
But more than that, a major funding by multilateral development banks (MDBs) in the area of renewable energy seems to have injected some confidence in it.
Under their Climate Investment Fund, multilateral development banks are launching a 40 million US dollars Scaling Up Renewable Energy Program (SREP) through the AEPC, half of which will go for one to 10 MW hydropower development.
The centre’s officials admit that SREP was indeed instrumental in making them push for a rise in the installed capacity of the hydropower plants they could build.
“It definitely had some role,” says Chaulagain. “And also, internationally up to 10MW of hydropower plants are recognised as renewable energy and we are the only government institution in the country dealing with renewable energies.”
AEPC officials also said the scoping missions of SREP donors wanted to deal with a single government agency and “not with one for below one MW of hydropower projects and with the other for bigger plants.”
Energy ministry officials are outraged by that idea.
“We know that some donors needed to spend their money somewhere and they found the AEPC as the right medium to do so,” said a highly placed source at the ministry. “And so, you have the AEPC’s new regulation with the raised ceiling for hydropower generation, but that is just a piece of paper.”
By that, energy ministry officials mean they are in no mood to share their space. To further stamp their authority in the hydropower generation territory, they have just unveiled what they call load-shedding minimising plans.
According to details published in this daily’s sister publication, Kantipur, the plans include increased buying rates for electricity produced by the private sector, ramping up investments on projects being developed by Nepal Electricity Authority and a waiver of value added tax for under-construction plants.
AEPC officials do realise the resistance they may have to face because the department of electricity development under the energy ministry is the ultimate authority to issue licenses for power generation.
“And we have never said that we would bypass their authority,” says Chaulagain. “We will be duly informing them about whatever we do and they will still be the authorities to issue the licenses.”
If the energy ministry does not cooperate still, could the good offices of the multilateral development banks financing the renewable energy program do something about it?
If they really could, perhaps their own old energy programmes would not have remained unplugged even during power crisis like this.
Khadka is a BBC journalist based in London
navin.khadka@gmail.com
Posted on: 2012-02-10 10:19
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