KATHMANDU: The Nepal Electricity Authority (NEA) has reported significant progress in electricity generation, transmission, distribution and cross-border power trade, while outlining an ambitious roadmap for the sector as it enters its 41st year.
The authority unveiled its annual report for fiscal year 2025/26 (2082/83) on the occasion of its 41st anniversary. Acting Executive Director Dirghayu Kumar Shrestha presented the report, highlighting major developments in Nepal’s electricity infrastructure and financial performance.
According to the report, Nepal’s total installed electricity generation capacity reached 4,120 megawatts by the end of the fiscal year. A total of 529 MW of new generation capacity was added to the national grid during the year.
The number of NEA customers increased by 3.85 percent year-on-year to 5.927 million. Domestic consumers accounted for 90.64 percent of the customer base, while industrial consumers represented 1.20 percent.
Revenue and profit rise
The NEA generated total revenue of Rs166 billion from electricity sales and other sources during the fiscal year. Revenue from electricity sales alone increased 18.20 percent from the previous year to Rs148.62 billion.
Improved electricity-loss management and higher power exports helped increase the authority’s gross profit by 13.70 percent to Rs31.23 billion. Its operating profit stood at Rs24.81 billion.
However, higher foreign exchange costs, depreciation and interest expenses affected the authority’s bottom line. Its profit before tax stood at Rs5.04 billion.
The report said foreign exchange movements caused the authority’s foreign-exchange-related liability to surge 272.86 percent year-on-year to Rs11.51 billion.
Generation and transmission expand
During the year, the 102 MW Madhya Bhotekoshi Hydropower Project began commercial operation, while the 40 MW Rahughat Hydropower Project entered the testing phase.
On the transmission front, the completion of the Kohalpur–Surkhet transmission line connected Karnali Province to the national 132 kV transmission network for the first time.
The Khimti–Barhabise 400 kV and Marsyangdi–Bharatpur 220 kV transmission lines also came into operation. The authority has targeted completion of the Hetauda–Dhalkebar 400 kV transmission line by November.
The country’s high-voltage transmission network has now reached 7,110 circuit kilometres, while total substation capacity has increased to 15,541 MVA.
NEA is also carrying out underground electricity distribution projects in Kathmandu, Bharatpur and Pokhara.
Private sector adds 529 MW
Private-sector hydropower projects continued to play a major role in expanding Nepal’s generation capacity. A total of 528.89 MW was added to the national system from 23 private-sector projects during the fiscal year.
The NEA has signed power purchase agreements (PPAs) with 545 projects with a combined capacity of 12,135 MW.
Nepal also strengthened its position as a regional electricity exporter. During the year, the country imported electricity worth Rs10.56 billion, while exports reached Rs29.31 billion.
Electricity exports increased by 68 percent compared with the previous fiscal year.
The report also highlighted important decisions aimed at facilitating electricity trade with India, including progress related to the Butwal–Gorakhpur and Dhalkebar–Muzaffarpur cross-border transmission corridors.
Focus shifts to large-scale and renewable projects
The NEA said it will prioritize reservoir-based hydropower projects, pumped-storage facilities and solar power to support the government’s target of generating 28,500 MW of electricity by 2035.
The Butwal–Gorakhpur 400 kV transmission line is scheduled to come into operation this year, while construction of the Chilime–Kerung transmission line is also expected to begin.
The authority has also set its sights on transforming electricity services through digital technologies.
Under its digital transformation strategy, the NEA plans to accelerate the deployment of artificial intelligence-based data centres, AI chatbots and smart meters.
Green hydrogen enters NEA’s roadmap
The authority is also exploring ways to increase domestic electricity consumption through green hydrogen.
It plans to establish an electrolyser in Hetauda and develop green ammonia and methanol production as part of its strategy to create new domestic markets for electricity.
The NEA said these initiatives are intended not only to expand electricity generation and transmission capacity but also to strengthen domestic consumption, improve operational efficiency and position Nepal as a regional clean-energy hub.
