Energy is central to nearly every major opportunity and challenge the world faces today. Be it for jobs, security, climate change, food production or increasing incomes, access to energy is essential. Globally, one in five people still lack access to modern electricity, and 3 billion people rely on wood, coal, charcoal or animal waste for cooking and heating. Energy is the dominant contributor to climate change, accounting for around 60 percent of total global greenhouse gas emissions. Thus, reducing the carbon intensity of energy is a key objective in long-term climate goals. In Nepal, renewable energy accounts for only 3 percent of total energy consumption. Nearly 67 percent of the population has access to electricity. In terms of policy intervention, there is an ongoing preparation of a Country Action Plan and Investment Prospectus for the energy sector. The Renewable Energy Policy should also be in place soon.

Diversifying energy supply

It is true Nepal has high potential in hydro power and various renewables. But political and economic factors, as well as the attitude of the citizens, have led to an unending energy crisis in the country. Nepal has not focused strongly on diversifying the energy supply, improving energy efficiency, addressing environmental and climate changes and modernising the energy infrastructure to meet the challenges ahead. Besides security of supply and affordability, we are further confronted with another challenge, namely that of making a rapid shift to a low carbon, efficient and environmentally benign system of energy supply. What is needed is nothing short of a complete change in habits through decisive policy actions, but this should be accomplished without losing sight of the affordability criteria. In this venture, the collaboration of the private sector and other stakeholders is absolutely necessary; the present collaboration, co-ordination and co-operation between public and private partnerships in the country needs to grow stronger while Civil Society Organisations (CSOs) remain to be recognised as an important pillar in the development process.

Energy is the driver for development in any country. To graduate from the status of Least Developed Country, for the energy scenario estimated from base year to end year, 2013-2022, total energy consumption per capita must increase from 15.4GJ to 18.4GJ and the commercial energy consumption per capita from 2.8GJ to 4.8GJ. From the country’s prevailing commercial energy situation—characterised by total dependence political challenges—Nepal must begin to aspire for energy sovereignty. This will be possible through a larger mix of renewable energy. With new developments in the sector and decreasing costs, renewables can be more reliable.

There must be initiatives to promote renewables beyond their use for cooking and lighting and to exploit them for health services and productive uses. It is high time we began measuring socio-economic benefits rather than the number of systems that are put in place. For this, attention has to be directed towards systems that are able to meet demand in a consistent manner, assuring security and reliability of supply at affordable prices. For a larger part of Nepal, with topographical challenges and scattered settlements, it is the decentralised renewable energy systems that should cater to a wider range of energy needs leading to higher economic benefits for individuals, community and the nation. This could drive the country up the economic ladder and out of its LDC status.

Some policy recommendations

We should set long-term targets which will provide a key signal to stakeholders, in particular, to developers, investors and manufacturers, about the long-term opportunities available in a given market. Setting long-term targets provides a clear policy direction, thereby fostering long-term investments in renewable energy manufacturing as well as in project development, including skills development for men as well as women. We should build a broader support base towards achieving the set targets, which will raise confidence. Policies have to be linked closely to regular monitoring of market conditions to allow for timely adaptation to changes in system costs and learning curves with a view to avoiding windfall profits and better control of overall market growth. There should be fair play for renewables, which are presently challenged by price distortions from existing subsidies and unequal tax burdens.

Finally, we should facilitate integration of renewable energy within the different energy-consuming sectors such as agriculture, transport, communication and health without imposing unmanageable risks on renewable energy investors.

Shakya is an independent researcher specialising in renewable energy and women empowerment; this article is part of a weekly series on SDGs