May 25, 2022, Wednesday
Nepal 1:37:26 pm

Renewable energy subsidy policy, 2078 for enhancing energy access

The Nepal Weekly
February 22, 2022

– By Krishna Adhikari

Mainly target community, people suffered by pandemic or natural calamities and the locations where energy access is limited or very low are deprived of energy access. Government of Nepal has been providing easier access to such communities since 25 years. As such, Alternative Energy Promotion Centre (AEPC) was created and assigned the noble jobs. The centre is under Ministry of Energy, Water Resources and Irrigation.

The new policy was approved by cabinet meeting of council of minister held on February 17, 2022.Earlier subsidy policy 2068 and subsidy policy 2073 were brought into effect.

The policy has provisions to support the users by 60% to 70% subsidy to specified region and districts, investment 20% to 30% of Provincial government or local level or supporting institution and user to spend 10%. The project in investment partnership will have to be followed Public Procurement Process with reverse auction method. 

The fresh subsidy policy will replace the earlier policies. Alternative Energy Promotion Centre (AEPC), the implanting agency will extend financial and technical supports as per the spirit to the consumers where electricity distribution through the national grid is absent. So as micro or mini hydropower plants from 10 kW to 1000 kW capacity will be promoted with AEPC support at 90% at upper limit.

Micro or mini hydropower plants from 10 kW to 1000 kW owned by cooperative or private or in public private partnership community on basis of geographic condition or consumption of energy whichever the modality the operator choose will be considered for subsidy approval.

Similarly, AEPC will extend financial and technical supports to Solar Mini-grid systems of up to 250 kW of electricity plants of Solar PV technology owned by local level, the new policy mentions.  

Utility model Solar electricity plants with up to 100 KW electricity generating capacity at the locations where national grid or any type of mini-grid is absent will be provide subsidy of 60 per cent of the total cost of the project. Likewise, 90% subsidy will be provided to local level or community.

For construction of domestic size biogas plants model GGC 2047 or modified design which use cow dung or buffalo dung as main input materials will be provided a subsidy of Rs. 32,500, Rs. 39,000 and Rs. 45,500 to 2 cubic meter, 4 cubic meter and 6 cubic meter domestic biogas plants in the mountain districts and Rs. 26,000, Rs. 32,500 Rs. 39,000 to hill districts and Rs. 19,200, Rs. 24,000 and Rs. 28,800 in the Teri districts.

The consumer of domestic biogas plants and the private companies who supply, construct and install biogas plants will be provided credit facilities utilising the reserve fund, income of carbon trade or any other resources. The credit facilities will be equivalent to the fund of Nepal Government agriculture credit programme, mentioned in the policy.     

AEPC has been promoting and developing renewable energy technologies since its inception 25 years ago. The centre has been successful in delivering services collaborating with private sector and development partners. The new subsidy policy will be instrument in delivering services to rural and poor people, executive director of the centre Dr. Madhusudhan Adhikari had said. He added that so far 10% of total population still deprived of electricity access and the new policy will be truly effective to help such populace to benefit with lighting and cooking in electricity.

The centre had supported to generate 68.75 MW of electricity through micro and mini hydropower projects and Solar PV systems so far. Similarly, it had supported to install 1.5 million improved cookstoves, 430,000 domestic biogas plants, 12,000 improved water mills and successfully carried out many other alternative energy promotion and development activities.

New subsidy policy has been prepared in line with provisions and guidelines of the Constitution of Nepal 2015 AD, Sustainable Development Goals of UN (2016-2030), White Paper of Nepal Government Ministry of Energy, Water resources and Irrigation 2019 AD, 15th Periodic 5 years Plan, Dr. Adhikari mentioned.

The important document like Decentralised Electricity System Master Plan 2020 and Study on National Energy Level Based Energy Model 2017, Biomass Energy Strategy 2016 also had stressed need of promoting sustainable energy technology and clean cooking solutions. All such guidelines have been believed to be addressed by new subsidy policy. (RSS)