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By Shanker Man Singh

Recently, the ‘dedicated’ and ‘trunkline’ controversy, which has been entangled for a long time, has come to the surface again. The electricity authority had given the last time to pay the fees for the use of ‘dedicated’ and ‘trunkline’.

The Authority cut off the electricity lines of some industries. Earlier, after a dispute the Council of Ministers formed a judicial commission under the leadership of former Supreme Court judge Girish Chandra Lal on the initiative of the Prime Minister.        Although the Council of Ministers gave instructions to implement the recommendations given by the Commission, the Authority has not implemented them due to various arguments. “By going against the recommendations of the Judicial Commission and the directives of the Council of Ministers, the Authority has started threatening us,” say the industrialists.

The ‘Dedicated’ and ‘Trunkline’ arrears dispute dates back to 2075. Some time ago, the government of Nepal seems to be trying to find a middle ground in the tariff dispute of dedicated and trunk lines.

It was made public that the Office of the Prime Minister and the Council of Ministers had written to the Ministry of Energy to collect arrears. The commission of inquiry formed under the coordination of a former judge of the Supreme Court submitted a report to the Minister of Energy, Water Resources and Irrigation recommending not to charge premium fees for dedicated and trunk line usage.

The commission had asked to collect the fee on the basis of TOD meter. The authority did the billing from 2072 to 2077. In this regard, the industrialist took electricity through a dedicated feeder and trunk line from 2072 when the industry was not operational due to load shedding.

But the tariff rate was determined later. “Out of the period in which the authority supplied electricity to its industrial customers through dedicated and trunk lines.

In the dispute that has been going on for nearly eight years, the government has taken some strict steps.

The Authority said that 59 industries had to pay 22 billion 24 million rupees in arrears when the line was cut. The authority cut the lines of 24 different industries from the first week to non-payment of dedicated and trunk line service fees.

In the past, industrialists were saying that they would not pay the electricity tariff that was not consumed by the industrialists, but the Authority was constantly pressuring them to pay the electricity tariff.

It was decided to determine the electricity tariff of the customer who receives continuous electricity supply for 20 hours or more from a separate trunk line in case of load shedding for 6 hours or more. According to the public information, 67 industrial customers had about 20 billion rupees outstanding. The dedicated and trunk line dispute dates back to 2015, during load shedding, the authority had decided to provide electricity to industrialists and businessmen by charging a premium fee (additional fee) in 2072.

Controversy arose in 2018 when the Authority billed 67 industrialists to pay premium charges for using dedicated and trunk lines since 2015. The industrialists have said that the authority is forcing them to pay the tariff arbitrarily.

The Authority is accused of acting contrary to its policy decision, electricity tariff collection regulations 2073 and the decision of the board of directors of the authority. The industrialists had argued that they were ready to pay tariffs based on electricity consumption using Time of the Day (TOD) metering.

Remember, dedicated and trunk line days were started in 2072. At that time, both these lines were started on the basis set by the Electricity Tariff Commission. There was a peak load shedding of over 18 hours in the country. Due to the lack of electricity, the industries had to reduce their production and the business was crippled, they were demanding to provide electricity anyway.

The Authority announced that load-shedding has been removed from 2075. A new tariff was implemented in 2077. Only two years after the removal of load shedding, the authority also removed the provision of trunk and dedicated lines by imposing new tariffs.

Even though the load shedding has been removed, the businessmen were saying that they could not pay because they sent additional bills for two years. If the industrialists and businessmen had completed the legal process on time, the dispute would have been resolved.

Some think that there will be problems if they do not obey. Also, it cannot be said that the Prime Minister’s instructions have not changed. Therefore, rather than prolonging the problem and giving assurances, it is necessary to instil a culture of working in the process and method.

The conflict between the Electricity Supply Authority and the industrialists of the country seems to benefit no one. Sadly, there are different opinions on this matter. What is the principle of charging extra for using dedicated and trunk lines? Electricity is supplied on the basis of that?” Whose opinion should be seen? If this facility is brought with a good intention, the dispute should be resolved by evaluating the benefits.

In the past, the Authority’s efforts to resolve the tariff dispute for the use of dedicated and trunk lines will be successful this time as well, but it remains to be seen whether it will fail.

Although the Authority has announced an instalment plan to settle the long-standing tariff disputes between some industrialists and the Authority, only a few industries have applied.

As the economic activity shrinks along with the increase in industrial costs, the increase in demand tariffs will hurt the targeted economic growth and job creation. Electricity tariffs should be reduced and other charges should be removed to create competitive products and jobs.

Some time ago, the Authority started cutting power in the industrial sector saying that it was expensive in India. If regular electricity is not available, there is no condition to operate the industry, the industrialists are facing huge losses.

If the government does not provide regular electricity, there are cases where the industry will be shut down. If electricity cannot be imported from India, the situation should not be allowed to arise where electricity is not available to large industries.

Recently, due to the shortage of coal in the international market, the production of electricity in India has decreased. The electricity demand in India has increased at a high rate. According to the Ministry of Energy of India, the electricity demand reached the highest ever 277,000 megawatts in a single day.

Therefore, it seems that the Authority should also consider the possibility of bringing electricity from India immediately. In the past, Nepal signed an agreement to purchase 350 MW of electricity from India’s NTPC Vidyut Vyapar  Nigam and 65 MW from the Power Transmission Company (PTC).

Similarly, 100 megawatts of electricity used to come from the Bihar government. Apart from that, the Authority used to purchase electricity from the Indian Energy Exchange. In fact, due to rising prices of coal and petroleum products used to generate electricity in India, the power exchange market in India is currently in short supply.

The prices of coal and petroleum products have skyrocketed after Russia invaded Ukraine. The continuation of load shedding has affected industrial production and may also affect employment.

Jute, cement, iron and steel and brick and plastic factories operate in three shifts a day. If there is no regular supply of electricity, the private sector is worried that there will be a huge financial loss in the industries, a negative impact on exports, an adverse impact on productivity and a serious crisis in the country’s economy. Recent developments in South Asia such as (i) SAARC Framework Agreement on Energy Cooperation signed by member countries, (ii) the Energy Trade Agreement between Nepal and India and (iii) the Agreement to expand the transmission link between India and Bangladesh from 500 MW to 1000 MW through cross border electricity trade. etc. are prominent.

This is a strong sign of progress towards energy security. The contribution of production to the economy has not yet reached 6 percent. Since regular electricity supply is mandatory even for industrial reasons, the relevant bodies should be serious about this and expect proper management.

On the whole, if the Authority has made a mistake, the way to take legal redress is facing the industrialists. In addition, when the authority extends it and adds fines, it is estimated that the fees to be paid by the industry will increase by 100%. If the line management and the revenue could have been solved in time, the problem could have been resolved by now.

The views expressed in this article are the author’s own and do not necessarily reflect People’s Review’s editorial stance.