Nepal Electricity Authority considers tariff hike of 10-15% to address deficit

KATHMANDU: Nepal Electricity Authority (NEA) is contemplating a surge in electricity tariffs, considering an increase ranging from 10 to 15 percent.

Attributing a deficit of Rs 0.12 per unit, NEA has decided to make tariff adjustments based on different customer categories. It is asserted that an increase in the management fee is deemed necessary to ensure the sustainability of NEA’s operations.

A senior NEA official stated, “The NEA does not profit from electricity sales. To ensure the provision of quality electricity and fund system improvements, increasing the tariff is the only viable option.” The official further added, “We have initiated preparations to adjust the tariff accordingly.”

The committee formed by NEA has proposed a tariff hike ranging from 10 to 15 percent. The actual tariff increase will only be implemented after the decision is approved by the Electricity Regulatory Commission.

“We have recommended a tariff hike ranging from 10 to 15 percent. The NEA’s management committee will determine the extent of the increase based on our recommendations,” mentioned a committee member.

Under the proposed revisions, customers currently paying Rs 10 per unit would witness their rates rise to Rs 11 with a 10 percent increase and Rs 11.5 with a 15 percent increase.

For single-phase low-voltage customers (230 volts, 15 amperes), the energy charge is presently set at Rs 9.50 per unit for consumption between 15 to 100 units. The minimum monthly charge is Rs 100. With a 10 percent increase, the energy charge would ascend to Rs 10.45 per unit, and with a 15 percent increase, it would be Rs 10.925 per unit.

Customers using three-phase low voltage (400 volts) up to 100 kVA will be charged Rs 10.50 per unit from the Nepali month of Asar to Kartik and Rs 11.50 per unit from Mangsir to Jestha.

Following the proposed adjustments, customers will have to pay Rs 11.55 per unit from Asar to Kartik and Rs 12.07 per unit with a 15 percent increase. From Mangsir to Jestha, the charges will amount to Rs 12.65 per unit with a 10 percent hike and Rs 13.22 per unit with a 15 percent increase.

NEA is poised to increase fees during off-peak hours, a shift from the past strategy of keeping tariffs low due to lower consumption during off-peak periods. The consistent demand throughout the day has prompted NEA to adjust prices accordingly.