Manoj Silwal, the Managing Director of the Nepal Electricity Authority (NEA), has clarified that the decision not to proceed with the Power Purchase Agreement (PPA) was based on a thorough analysis of the current electricity consumption and export situation.

He explained that the decision was made to avoid potential losses for the private sector in case the produced electricity cannot be utilized domestically or exported.

Silwal emphasized the importance of careful consideration before advancing PPAs, stating, "If we enter into PPAs now and projects are developed, but later we are unable to consume or export the electricity, it will not only impact us but also the private sector. That's why we have refrained from moving forward with PPAs after a detailed analysis."

He also mentioned that efforts are being made to secure permission from the Indian government for electricity export, which would facilitate the process.

"We need to assess our transmission capacity for export. Currently, our transmission lines can handle up to 1,200-1,300 megawatts. However, new infrastructure projects like the Dhalkebar-Sitamarhi line are in progress," he added. "We are seeking approval from the Indian government to export electricity from additional projects, which would streamline the export process."

The delay in signing new PPAs has raised concerns among energy producers, who have expressed fears of jeopardizing investments in hydropower projects.

Silwal noted that the current electricity demand is between 1,800 to 2,000 megawatts, with PPAs already in place for 12,000 megawatts. Therefore, he argued that there is no immediate urgency for additional PPAs at this time.