The government has planned to bring the Pharping Hydropower Project, the first electricity plant in the country and the second in Asia, back to life.

The Cabinet has decided to fire up the century-old relic from the Rana period in an attempt to boost morale with the country reeling under severe load-shedding and a fuel crisis.

Necessary studies and preparations will be made to put the historical 500 kW power station and other small hydel projects back into operation within two years under the government’s Two Year Immediate Action Plan.

Established in 1911 during the time of Prime Minister Chandra Shamsher Jang Bahadur Rana, the Pharping plant was humming as late as the 1990s.

King Prithvi Bir Bikram Shah had inaugurated the powerhouse by turning on electric light bulbs during a programme held at Tundikhel, Kathmandu. In 2010, it was declared a Living Museum by the government and opened to visitors.

Gokarna Raj Pantha, assistant spokesperson at the Ministry of Energy, said that the government had planned to operate the historic plant occasionally as a demonstration more than as a way to supply regular power.

The government has also planned to establish a Public Power Production Company as a holding company to enhance the capacity of the public sector to develop power projects. As per the action plan, the government is preparing to announce its concept.

“The Cabinet has already agreed in principle to establish a separate Public Power Production Company under which major projects such as the Naumure Hydropower Project will be developed, and the production unit of the Nepal Electricity Authority (NEA) will be brought under its fold once the NEA is unbundled,” said Pantha.

“The hydropower projects developed by the private sector under public-private partnership will also come under its fold once the private sector returns them to the government after 30 years of operation.”

The action plan has stated that the government will establish an Electricity Trading Company within a year to trade electricity.

It will also establish a National Energy Efficiency Centre to reduce unnecessary consumption of energy and ensure a balance between demand and supply. The government said that work had already begun on this front.

The action plan has incorporated various schemes to be implemented by various ministries and agencies within the next two years. A senior official at the Prime Minister’s Office said that the measures proposed in the action plan had been identified as being doable by the respective ministries.

Meanwhile, in the face of acute shortage of liquefied petroleum gas (LPG), the government has planned to establish bulk storage tanks in Janakpur, Kathmandu and other appropriate locations. The reserves are designed to ensure regular supply of LPG during the winter season when demands increases sharply.

According to Nepal Oil Corporation (NOC), demand for LPG surges by 30-40 percent during the winter as people use LPG not only for cooking but also to heat water. The country’s monthly LPG requirement amounts to 23,000 tonnes.

As per the plan, the government will also install 10 new petroleum storage tanks with a capacity of 70 kilolitres each by the next fiscal year 2015-16. Currently, Nepal’s petroleum storage capacity stands at 71,622 kilolitres, or enough oil for 20 days.

In the absence of adequate storage facilities, the country has been hit by an acute oil shortage following India’s trade embargo which has lasted since September 22.

The three-month-long embargo has led to shortages of essential goods, and the action plan has stated that the government will prepare an immediate working plan to ease the crisis once the blockade is lifted.  

1. As per this scheme, the government will also fix the maximum retail price (MRP) of domestically produced goods. The MRP regulation is currently applied only to imported products including vehicles, electronic goods and surgical instruments.