KATHMANDU, JUN 04 - 2012
The government has decided to hold a majority stake in the proposed National Grid Company (NGC). The government and the Nepal Electricity Authority (NEA) will own 90 percent of the shares and the rest will be sold to the general public.
Originally, it was planned that a dozen government agencies would own shares in NGC. Energy Ministry officials said that the idea of allocating shares to ministries and government agencies had been dumped temporarily as the process would take too long. They added that the reason for giving a majority stake to the government was to cut red tape.
“Currently, the major concern is to set up the company as soon as possible,” said Anup Prashad Upadhya, joint secretary at the Ministry of Energy. “We haven’t mentioned the names of the ministries and agencies which would own shares in NGC as the process is lengthy and complex and might become an obstacle to setting up the company.”
He added that once the documents are approved by the Finance Ministry, government agencies will be able to acquire shares.
The Energy Ministry has sent the articles of association and the articles of memorandum to establish NGC to the Finance Ministry for its okay. “Once the documents are endorsed by the Finance Ministry, we will register the company,” said Sher Singh Bhat, NEA director who heads the committee to finalise legal documents.
The proposed company would have an authorised capital of Rs 25 billion, issued capital of Rs 5 billion and paid-up capital of Rs 2 billion. NGC will operate all the transmission lines in the country having a capacity of more than 33 KV. It will levy a wheeling charge on all the power producers for use of the lines.
Independent power producers (IPPs) doubt the company will be formed as the Nepal Electricity Regulatory Commission Act 2008 which envisions the formation of a separate transmission company is yet to be endorsed. However, ministry officials say it will not make much difference as the company will be established as per the Company Act.
IPPs have long been demanding that the NEA be unbundled into separate transmission, production and distribution companies.
“The unbundling of the NEA into three separate companies is crucial as the NEA alone cannot focus on the development of transmission lines, production process
and distribution system,” said Subarna Das Shrestha, president of the Independent Power Producers’ Association of Nepal.
Source: The Kathmandu Post
The government has decided to hold a majority stake in the proposed National Grid Company (NGC). The government and the Nepal Electricity Authority (NEA) will own 90 percent of the shares and the rest will be sold to the general public.
Originally, it was planned that a dozen government agencies would own shares in NGC. Energy Ministry officials said that the idea of allocating shares to ministries and government agencies had been dumped temporarily as the process would take too long. They added that the reason for giving a majority stake to the government was to cut red tape.
“Currently, the major concern is to set up the company as soon as possible,” said Anup Prashad Upadhya, joint secretary at the Ministry of Energy. “We haven’t mentioned the names of the ministries and agencies which would own shares in NGC as the process is lengthy and complex and might become an obstacle to setting up the company.”
He added that once the documents are approved by the Finance Ministry, government agencies will be able to acquire shares.
The Energy Ministry has sent the articles of association and the articles of memorandum to establish NGC to the Finance Ministry for its okay. “Once the documents are endorsed by the Finance Ministry, we will register the company,” said Sher Singh Bhat, NEA director who heads the committee to finalise legal documents.
The proposed company would have an authorised capital of Rs 25 billion, issued capital of Rs 5 billion and paid-up capital of Rs 2 billion. NGC will operate all the transmission lines in the country having a capacity of more than 33 KV. It will levy a wheeling charge on all the power producers for use of the lines.
Independent power producers (IPPs) doubt the company will be formed as the Nepal Electricity Regulatory Commission Act 2008 which envisions the formation of a separate transmission company is yet to be endorsed. However, ministry officials say it will not make much difference as the company will be established as per the Company Act.
IPPs have long been demanding that the NEA be unbundled into separate transmission, production and distribution companies.
“The unbundling of the NEA into three separate companies is crucial as the NEA alone cannot focus on the development of transmission lines, production process
and distribution system,” said Subarna Das Shrestha, president of the Independent Power Producers’ Association of Nepal.
Source: The Kathmandu Post
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