Nawa Raj Dhakal, Executive Director, AEPC
The Nepal Weekly 
October 29, 2024Interview of AEPC Executive Director in The Nepal Weekly on the occasion of the 28th Anniversary of AEPC
(Born in Kaligandaki Rural Municipality-6, Khadgakot, Gulmi, Mr. Nawa Raj Dhakal is a widely recognized energy professional with more than two decades of experience in renewable energy, energy efficiency and climate change. Mr. Dhakal has a proven track record across the areas of policy and strategy formulation, planning and resource mobilization, programme management, organization development and capacity building in multi-cultural and multi-stakeholder environment. He has led the process of accreditation of Alternative Energy Promotion Centre (AEPC) as Direct Access Entity to Green Climate Fund (GCF).
Mr. Dhakal holds a Masters of Science in Renewable Energy from Naresuan University, Thailand and Masters of Science in Environmental Microbiology from Tribhuwan University. Government of Nepal appointed Mr. Dhakal as Executive Director of AEPC in May 2023.)
AEPC, established on 3rd November 1996 (i.e., 18th Kartik 2053 B.S.) under then Ministry of Science and Technology and now under the purview of Ministry of Energy, Water Resources and Irrigation (MoEWRI), has swiftly transformed into a nationally and internationally recognized institution tasked with promoting, developing and deploying the renewable energy and energy efficiency with particular focus in rural and remote areas of the country.
(AEPC is completing its 28 years on November 3, 2024. Against this backdrop, Mr. Shirish Pradhan, Editor/Publisher of The Nepal Weekly talked to Mr. Dhakal about the different aspects of renewable energy, energy efficiency and climate finance in Nepal.)
Established on 3rd November 1996 (18th Kartik 2053 B.S.), AEPC is mandated to promote, develop and deploy renewable energy (RE) and energy efficiency (EE). AEPC is partnering with Government Organizations, Provincial Governments, Local Levels, Development Partners, various national and international organizations, private sector, financing institutions, academia, civil society organizations and user groups for effective implementation of RE and EE initiatitives. AEPC’s experience with eight carbon projects under the Clean Development Mechanism (CDM) lays a solid foundation for developing future carbon projects under both the Paris Agreement and voluntary carbon markets. In 2019, AEPC became the first Direct Access Entity to the Green Climate Fund (GCF) from Nepal, enabling it to mobilize climate finance for projects focusing on mitigation, adaptation and cross-cutting issues.
The Constitution of Nepal 2015 guarantees the right to a clean environment and mandates that every citizen has the right to live in clean and healthy environment. It further obliges the government to ensure a reliable supply of energy that is affordable and accessible to meet the basic needs of citizens. The state powers related with energy services are distributed among the federal, provincial and local levels as per the constitutional mandates (as per clauses 57 & 58 and schedules 5 to 9 of the constitution) urging for the collaboration, coordination and cooperation among all three levels for the development of energy sector. The federal set up of the nation puts emphasis on the inclusive socio-economic development and hence development of RE and EE can play a big role in such development.
Nepal, blessed with abundant renewable energy potential, is strategically aiming to diversify its energy sources and accelerate the transition towards a sustainable green economy. The Government of Nepal (GoN) has recognized the energy sector as a national priority, outlining its goals in various strategic documents, including Sustainable Development Goals: Status and Roadmap (2016-2030), Biomass Energy Strategy (2017), National Energy Efficiency Strategy (2018), MoEWRI White Paper (2018), Second Nationally Determined Contribution (2020), Long term Strategy for net Zero Emissions by 2045 (2021), National Adaptation Plan (2021), Green Hydrogen Policy (2024) and Sixteenth Plan (2024/25-2028/29).
AEPC is honored to celebrate 28 years of service to the Nepali people providing clean, efficient, affordable and modern energy solutions at the household, community, institution and enterprise levels. Our efforts have significantly increased the share of RE in the national energy mix, reducing reliance on traditional fuels and imported fossil fuels and promoting EE initiatives thereby strengthening energy security and reducing carbon emissions. AEPC has also played a key role in fostering energy entrepreneurship, creating employment opportunities thereby improving the quality of life for the Nepali people of Nepal especially in the rural and semi urban areas. Over the years, AEPC has supported around 15 million people in meeting their energy needs through deployment of appropriate RE solutions through technical assistance, subsidies, credit and viability gap funding (VGF). More than 500 companies and numerous local communities have led service delivery, creating employment opportunities for over 40,000 individuals. These achievements have directly contributed towards inclusive socio-economic development.
In our efforts to promote RE and EE, in fiscal year 2023/24, we have implemented various programs under two budget sub-headings: (1) Alternative Energy Promotion Centre (AEPC) incorporating targeted RE and EE programs as per the priorities of GoN, where physical and financial achievements reached 86% and 84% respectively, and (2) National Rural and Renewable Energy Program (NRREP) incorporating the programs and projects jointly funded by GoN and EDPs, where achievements were 81% and 78% respectively.
The key physical progress of AEPC in the last fiscal year include installation of 1,312 kW mini/micro hydropower plants, 390 kW solar/wind minigrid plants, 8,306 solar home systems; deployment of 26,256 electric cookstoves and 4,508 metallic improved cookstoves; construction of 3,042 domestic biogas plants; 349 solar photovoltaic pumping schemes for drinking water and irrigation; and 311 institutional solar photovoltaic systems for powering remote healthcare facilities and community schools.
Additionally, in the same fiscal year, a total of 542,866 tons of CO2 equivalent Emission Reductions (ERs) were issued from our CDM and Gold Standard projects and USD 2.85 Million carbon revenue was earned. We have also accomplished the preparatory work for development of carbon projects under Article 6.2 and transition of our existing CDM projects in to the Article 6.4 of the Paris Agreement.
Under the leadership of MoEWRI, AEPC has been rigorously engaged in the formulation of Renewable Energy and Energy Efficiency (REEE) Bill. The bill has been approved from the Cabinet and tabled in the National Assembly of the Federal Parliament. The bill is currently under discussion in the Committee for Legislation Management of National Assembly.
During the previous year, we have emphasized on partnering with Provincial and Local Governments to foster an enabling environment and facilitate RE and EE initiatives. This includes providing support in capacity building, developing energy plans, and implementation of RE and EE Programs.
AEPC has been implementing diverse projects and programs with support from various DPs. With the support of UKAid (British Embassy Kathmandu), AEPC is prividing financial and technical assistance to various RE projects in Nepal via Nepal Renewable Energy Program (NREP) by providing VGF support under Sustainable Energy Challenge Fund (SECF) incorporated into the Central Renewable Energy Fund (CREF) of AEPC. In addition, technical and financial support from Renewable Energy and Energy Efficiency Program-Green Recovery and Empowerment with Energy in Nepal (REEEP-GREEN) funded by German Development Cooperation and European Union through GIZ have also been mobilized into SECF.
To date, through SECF we have supported the installation of 28 solar water pumps, 6.1 MWp of solar rooftop systems and deployment of 30,000 electric cookstoves. SECF has supported the transition of 50 enterprises to RE and many projects are in the various stages of implementation.
Other DP supported initiatives include South Asia Sub-Regional Economic Cooperation (SASEC) program supported by Asian Development Bank (ADB), Nepal Private Sector-led Mini Grid Energy Access Project (MGEAP) supported by World Bank, Promotion of Solar Energy in Rural and Semi-urban Regions of Nepal supported by German Development Cooperation through KFW, Renewable Energy for Rural Livelihood Project supported by UNDP, ADB and Norway, Micro Hydro Debt Fund (MHDF) supported by GIZ/EnDev; and REEEP supported by German Development Cooperation through GIZ. Biogas Credit Fund (BCF), initially started with support from KFW, is provides soft loan for biogas users through Local/Micro Finance Institutions.
“Mitigating greenhouse gas emissions through modern, efficient and climate-friendly clean cooking solutions (CCS)” is the first GCF-funded project under AEPC being implemented in close cooperation with Local Governments and private sector. Additionally, AEPC is also implementing GCF Readiness and Preparatory Support Programme as the delivery partner of the Ministry of Finance.
Expanding modern energy access (both electrification and clean cooking), increasing the reliability and quality of energy through distributed RE, contributing to energy mix and energy transition, and adoption of EE in all sectors are the topmost priorities of AEPC.
We still need to place special emphasis on reaching the most remote and underserved populations and lead the way in rapidly shifting paradigms in areas like municipal waste-to-energy projects and large-scale biogas plants, bottling, and pipelines, with the aim of up-scaling the renewable energy sector in terms of capacity, investment, size, and innovation.
The continued implementation of one of our flagship initiative “Sustainable Energy Challenge Fund (SECF)” critical for broader reach and stimulating innovation.
AEPC is committed to mainstreaming RE and EE initiatives by fostering partnerships with bilateral and multilateral development partners as well as international climate funds, and collaborating with provincial and local governments, private sector and other partners. Coordination with other sectors such as agriculture, forestry, health, education, and urban development is a must for the integration and RE and EE services in the respective sectors.
Enactment of REEE Bill, approval of subsequent REEE Regulation, transformation of current AEPC into a new organization as proposed under REEE Bill and formulation of working guidelines are the prerequisites for the advancement RE and EE sector in Nepal.
