Regulator rejects Panchakanya Industries’ claims in dedicated and trunk line power dispute

KATHMANDU: The review committee under the Electricity Regulatory Commission of Nepal has rejected the claims of two industries under the Panchakanya Group in the long-running dispute over electricity charges related to dedicated and trunk line power supply.

After a full-day hearing on Sunday, the committee dismissed the review petitions filed by Panchakanya Steel and Panchakanya Plastic, concluding that the industries’ claims that they had not used electricity through dedicated and trunk lines were not valid.

Chairperson of the commission Ram Prasad Dhital said the committee reached its decision after evaluating extensive technical evidence and operational records.

“The committee relied on several facts and pieces of evidence during its assessment,” Dhital said, noting that a technical team was deployed to conduct a field study of the industries. The investigation also analyzed Time-of-Day (TOD) electricity data and technical parameters.

According to the commission, the analysis found that electricity had been supplied and consumed during peak, off-peak, and normal hours, indicating that the industries had indeed used the power infrastructure under dispute.

Evidence from Production Data and Technical Records

Even though a complete load profile was not available, the committee said it examined several operational indicators to verify electricity consumption. These included the volume of steel and plastic production, the amount of scrap generated during power interruptions, and the industrial logbooks maintained by the factories.

The findings suggested that electricity was being used even during the period of nationwide load shedding, contradicting the claims made by the industries.

The committee also reviewed the report of the Lal Commission, government policy decisions, and previous court rulings before issuing its decision. A brief order has already been released, while the commission is preparing to publish the full detailed verdict in the coming days.

NEA Can Proceed with Dues Recovery

Following the committee’s decision, the Nepal Electricity Authority (NEA) now has the legal basis to proceed with the recovery of outstanding electricity dues from the two industries.

However, the industries still have the option to challenge the decision in court if they are dissatisfied with the ruling. Under existing provisions, they can file an appeal at the High Court.

Both companies had earlier approached the administrative court within the commission after paying the required 5 percent service fee of the disputed amount, which is mandatory for registering a review case.

The petitions were filed on November 9, 2025 (Kartik 23, 2082 BS) after the NEA cut electricity supply to the industries due to unpaid dues.

Government-Mediated Compromise Framework

The broader dispute over dedicated and trunk line electricity tariffs has been ongoing for years between industrial consumers and the NEA.

Following power disconnections, a high-level meeting led by Prime Minister Sushila Karki and attended by senior government officials and Chandra Prasad Dhakal, president of the Federation of Nepalese Chambers of Commerce and Industry, had earlier proposed a compromise mechanism.

Under that arrangement, industries were allowed to reconnect power lines after paying the first installment of outstanding dues, while the remaining payments could be cleared in 28 installments. Companies dissatisfied with the charges were permitted to seek administrative review through the commission.

Billions in Outstanding Industrial Electricity Dues

The dedicated and trunk line dispute covers electricity bills accumulated between January 29, 2016 and April 13, 2018 (Magh 2072 – Baisakh 2075 BS) during the load-shedding era.

According to the NEA, 25 industries owe a total of about Rs5.48 billion in outstanding dues for that period. The authority has allowed payment through the 28-installment mechanism to facilitate settlement.

The recommendations of the Lal Commission have also shaped the government’s approach to the dispute. The commission, chaired by former justice Girish Chandra Lal, was formed in January 2024 (Poush 2080 BS) and submitted its report to the government in April 2024 (Baisakh 2081 BS).

The report recommended recovering approximately Rs6.11 billion in outstanding dues from 58 industries related to the use of dedicated and trunk line electricity during the load-shedding period.

Among the affected companies, 13 industries had already begun installment payments before their power supply was disconnected, while 10 industries have fully cleared their dues. Two state-owned enterprises have committed to paying their dues in installments.

In some cases, such as Dabur Nepal, authorities have already recovered dues by confiscating deposited guarantees, while several other industries have obtained interim court orders as the legal dispute over the electricity charges continues.