KATHMANDU: Energy, Water Resources and Irrigation Minister Biraj Bhakta Shrestha has said the government is positively studying whether Nepal’s existing legal framework is sufficient-or if new legislation is needed-to allow greater private sector participation in electricity trading.
Speaking during a meeting with officials of the Independent Power Producers’ Association, Nepal (IPPAN) on Friday, Shrestha said expanding Nepal’s clean, green and reliable electricity into competitive regional markets would require greater involvement from the private sector.
While acknowledging the private sector’s significant contribution to hydropower generation, the minister said opportunities in electricity trading remain limited. He stressed that evolving regional energy markets and cross-border power trade require timely policy decisions to enable private sector participation.
Shrestha also said he was positive about granting the necessary approvals for private companies to explore international electricity markets through a business-to-business model in coordination with the Nepal Electricity Authority (NEA).
He said that as Nepal moves forward with its domestic energy consumption and power export strategy, electricity trading could become a major new investment and business opportunity for the private sector.
However, the minister emphasized that any policy allowing private participation must safeguard the NEA’s role, authority and responsibilities while ensuring that state revenues and public interests remain fully protected.
During the meeting, former IPPAN President Ganesh Karki said many hydropower projects worth billions of rupees remain without power purchase agreements (PPAs), arguing that allowing private companies to engage in electricity trading would also ease pressure on the government to sign additional PPAs.
IPPAN President Mohan Dangi said private sector participation in electricity trading and transmission is no longer an option but a necessity, urging the government to adopt policies that encourage genuine investors.
