Kul Man Ghising, the newly appointed managing director of Nepal Electricity Authority, on Tuesday outlined the worsened financial situation of the state power utility under the previous leadership.

On the occasion of the 36th anniversary of the authority, Ghising presented the financial situation of the authority following his exit.

Ghising said that the authority’s income was reduced by 6.59 percent to Rs71.28 billion while net profit plunged nearly 70 percent after his departure.

The authority’s net profit fell to Rs3.51 billion in the last fiscal year 2020-21 from Rs11.68 billion in the fiscal year 2019-20.

Incidentally, Ghising reading out the fiscal status of the electricity authority comes at a time when Hitendra Dev Shakya, the former managing director, has challenged his appointment at the Supreme Court.

A Cabinet meeting on August 9 had decided to appoint Ghising as the new managing director of the authority. Ghising is credited with ending the problem of power cuts and substantially increasing the profit of the authority during his first term as the head of the power utility.

After his four-year tenure expired in September last year, Ghising was replaced by Shakya, who had been working as the acting managing director of the authority since November last year.

To make room for Ghising's appointment, the government had appointed Shakya as an energy expert at the Water and Energy Commission.

But, unhappy with the decision, Shakya has appealed the Supreme Court against Ghising's appointment.

In his petition, Shakya has argued that he had neither resigned from the post nor was removed following the due procedure. He has appealed to the court to nullify Ghising’s appointment.

During his previous stint at the authority, Ghising had brought down electricity leakages to just over 15 percent from 25.78 percent in the fiscal year 2015-16.

In the last fiscal year, electricity leakage increased to 17.18 percent from 15.27 percent in the previous fiscal year 2019-20, according to the authority.

Ghising didn’t directly blame Shakya for the authority’s poor performance, both in fiscal and managerial terms. He did, however, say that the absence of a competent leadership had something to do with reduced performance of the authority.

Even Energy Minister Pampha Bhusal expressed her displeasure at the performance of the previous leadership of the authority without mentioning Shakya’s name.

“I was told recently that the authority witnessed electricity leakages of 16.93 percent. But, in fact, there had been more,” Bhusal said at the anniversary programme that was held virtually.

She said that the leadership of the authority was changed to ensure “the right person at the right place”.

“I have made similar changes at the Energy Ministry as well,” she claimed.

Ghising's appointment in the state power utility was among the first decisions made by the Sher Bahadur Deuba government.

Criticism of his performance as the head of Nepal Electricity Authority and his removal, however, have not gone down well with Shakya.

In his writ petition, Shakya has claimed that time had not come to evaluate his performance as he had not served even one full year as the head of the authority.

The hearing on his writ petition has been scheduled for Wednesday.

Whether Ghising will continue to remain the managing director of the authority depends on the court’s ruling.

Since his arrival, Ghising has already announced his plans and priorities for the authority.

One of his major priorities is minimising power wastage.

“Ensuring the market for electricity generated by the 456MW Upper Tamakoshi Hydropower Project and various other projects has emerged as a big challenge,” Ghising reiterated on Tuesday. “Technically, the country now has surplus energy, particularly during the wet season.”

Before the completion of the Upper Tamakoshi Project, Nepal had an installed capacity of 1,385MW. With the addition of power from Upper Tamakoshi, the country’s installed capacity has now reached over 1,800MW.

According to the authority, peak demand currently stands at 1,550MW. This means when all units of Upper Tamakoshi start production, the country will have nearly 300MW of surplus energy in the wet season.

“Necessary measures will be taken to increase consumption of electricity at home and to export the surplus energy,” said Ghising.

In order to increase domestic power consumption, plans are afoot to review the tariff being imposed on infrastructure development, rural electrification, agriculture, irrigation, and industries.

The state power utility has also initiated the move to export electricity.

In April, India officially allowed Nepal entry to its power exchange market. The Indian Energy Exchange (IEX) announced the “commencement of the Cross Border Electricity Trade" on its platform, allowing Nepal, Bangladesh and Bhutan to participate in power trading.

With a view to selling electricity, the Nepal Electricity Authority in May this year participated in a bid, seeking to export 40MW to the Punjab state of India. The authority is currently awaiting response from Punjab State Power Corporation Limited.

If Punjab is ready to buy electricity from Nepal, electricity will be delivered via Dhalkebar-Muzaffarpur 400 KV interstate transmission line.

According to Ghising, the authority has plans to develop more cross-border transmission lines with India.

“Infrastructure will be developed to enable trading in line with the agreement reached with Power Grid Corporation of India for electricity trade regionally and sub-regionally,” Ghising said.

“The construction of the 400KV Butwal-Gorakhpur cross-border transmission line will be initiated while detailed design work of 400KV Ratmate-Kerung will also be initiated.”