3 A YEAR IN REVIEW- FISCAL YEAR-2014/2015 Board of Directors 4 Nepal Electricity Authority NEPAL ELECTRICITY AUTHORITY Organizationi al S Structurel l NEA Board Audit Committee Managing Director Internal Audit Department L-11 Acc. MD'S Secretariat, NEA Subsidiary L- 11 T Companies Loss Reduction Division L-10 Electrical Distribution & Consumer Services Generation Transmision Planning, Monitoring & IT Engineering Directorate, Project Mgmt. Administration Finance Directorate, Directorate, Directorate, Directorate, DMD L-12 T Directorate, Directorate, Directorate, DMD L-12 T DMD L-12 T DMD L-12 T DMD L-12 T DMD L-12 A DMD L-12 A Grid Operation Planning & Technical Large Power Plant Operation Biratnagar Regional Office, Department, Power Trade Department, Project Development Services Department, L-11 T & Maintenance Department*, Department, L-11 T L-11 T Project Preparation Accounts Department, L-11 T L-11 T L- 11 T Human Resource Department, L-11 Acc Janakpur Regional Office, Grid Development Department, Community & RE L-11 T Medium Power Plant Information Technology L-11 T L-11 Adm Department Department, Environment & Social Operation & Maintenance L-11 T Department, Study Department, L-11 T Department*, L-11 T Hetauda Regional Office, L-11 T L- 11 T General Service Corporate Finance System Operation Finance Division, L-11 T Department, Department, Technical Support Department, Department, L-10 Acc. System Planning Department, L-11 Adm L-11 Acc L-11 T L-11 T L-11 T Soil Rock and Concrete Kathmandu Regional Laboratory, Office, L-11 T Major Transmission L- 11 T Legal Department, Administration Division, Projects 400 kV L-11 Adm Generation Development Corporate Planning & L-10 Adm Department, L-11 T Butwal Regional Office, Monitoring Department, L-11 T NEA Training Centre, L-11 T Major Transmission L-11 T L- 11 Adm Recruitment Material Management Div, Projects 220 kV Department, L-10 Electrical Administration Division, L-11 T Pokhara Regional Office, L-10 Adm Economic Analysis Department, Electromechanical Design L-11 Adm Monitoring & MIS Section, L-11 T Administration Division, L-11 Misc Division, L-9, Computer Finance Division, L-10 Adm L- 10 Electrical L-10 Acc Nepalgunj Regional Office, Finance Division, Administration Section, L-11 T Monitoring & MIS L-10 Acc L-9 Adm Section, L-9, Computer Attaria Regional Office, Monitoring & MIS Finance Section, L-11 T Section, L-8, Computer L-9 Acc Note : * Large Power Plant operation and Maintenance Department will be responsible above 30MW * Medium Power Plant operation and Maintenance Department will be responsible upto 30MW T = Technical Services; Adm = Administration services ; Acc=Account Group; Misc = Miscellaneous 5 A YEAR IN REVIEW- FISCAL YEAR-2014/2015 also has a large role to contribute. To add to it, extension which devastated central and western Nepal with high of the transmission grid and the distribution network is casualties and heavy losses. Even in such tragic and also NEA’s responsibility. difficult times, I am proud to announce that, NEA with Construction of Kulekhani-III Hydroelectric Project is in the support of all, proved to act timely and efficiently in progress. The 14 MW Kulekhani III Hydroelectric Project restoration of the power system, which was appreciated is a third cascade scheme of the Kulekhani Reservoir by all. project. Approximately 92% of the civil construction work and 45% of electro-mechanical installation works Financial Performance have already been completed. As per the MoU, the In spite of encouraging figures on demand side, NEA project duration has been extended by 30 months from could not cash the opportunity so created by converting the original 44 months. NEA Board has approved the new the potential demand into revenue due to lack of supply completion date for the Civil Contractor up to October sources. NEA’s financial performance did not remain up 15, 2015. All of the civil structure in the Headworks to the level of expectation. NEA incurred a net loss of Rs area is complete except the control room. It is targeted 6,510.04 million in FY 2014/15. Accumulated losses at to generate energy from Kulekhani III within the FY the end of FY 2014/15 reached Rs 26,798.62 million. 2072/2073. This project will generate regulated energy NEA earned total revenue of Rs 32,568.87 million during which is most needed for the power system of Nepal. 2014/15, of which Rs 30,483.46 million came from the Chameliya Hydroelectric Project constructed under joint main business, i.e., sale of electricity which is 5.89% funding of GoN, NEA and Korean loan was started in increase over last year’s figure of Rs 28,787.21 million. 2007 and is scheduled to be completed by March 2016. Similarly, NEA earned Rs 2,085.41 million under 'other The site is located at Sikhar VDC, Ward No. 4, Balanch incomes'. of Darchula District. The plant capacity is 30 MW with Moreover, FY 2014/15 was recorded as below average average annual energy generation of 184.21 GWh. Even from the point of view of dry season run-off discharge with numerous problems, the project has achieved 94% in the rivers, which ultimately reduced electricity progress so far. The headrace tunnel encountered the generation below expectation. High cost of service squeezing problem of maximum 40% (in diameter) for contributed by increased internal purchase at relatively a length of 843.00 m .The treatment for this squeezing higher tariff at generation point, annual escalation on has been completed in 615 m stretch. Another major purchase tariff, operation of thermal plants, import of problem faced by the project has been the excessive high cost seasonal energy from India, regular import at weak geological condition in the vertical shaft penstock relatively higher price, increased staff cost, increased forming the cavity with debris flow. The progress of maintenance cost and hike in prices of fuel and other Vertical shaft is 36 m out of 72 m. This project will commodities could not be responded by proportionate provide power in the far western Nepal and will enhance increase in volume of business and prevailing retail economic development in the region. tariff. Our average price of electricity was Rs 8.14. Rahughat Hydroelelctric Project with a capacity of 32 NEA’s liability towards Government of Nepal by the end MW is located in Galeshwor, near Beni, Myagdi District of year 2014/15 has reached Rs 49,631.95 million as in Dhaulagiri Zone of Western Nepal. In this project, most share capital and Rs 94,041.38 million as secured long of the land necessary for construction of the Project term loan. Similarly, by the end of FY 2014/15, NEA’s has already been acquired. Similarly the permission net property as plant and equipment at historical cost for cutting trees has also been acquired. After the reached Rs 84,368.67 million whereas Rs 59,070.79 Termination of the Contract with the Contractor, NEA million was recorded as expenditure in capital work in is reviewing its further execution plan. The detail design progress. NEA has also invested Rs 16,539.30 million of the structures, estimation of quantities, rate analysis, as equity shares in various subsidiary companies. preparation of tender drawings and preparation of tender documents are being undertaken at this moment. An Development Activities understanding was reached to complete this phase of NEA’s electricity supply position is far from satisfactory the work within three months, and Minutes of Meeting to meet the ever increasing demand, thus compelling for the same was signed with the Consultant WAPCOS NEA to resort to heavy load shedding. To overcome this Limited on 15th July, 2015. The design work has already imbalance of supply over demand, as well as to keep pace been started from 26th July, 2015 and the capacity with the annual demand growth presently averaging has been optimized at 40 MW. The re-design of the at 7.56%, NEA is undertaking the construction of a structures, for the new discharge and installed capacity, number of hydropower projects. Furthermore, some has already started. The notice for fresh tender will be hydropower plants are being developed through NEA’s issued by November 2015 and the new contractor is subsidiary and associate companies. The private sector expected to be appointed by June 2016. The Project is scheduled to be completed by June 2020. 8 Nepal Electricity Authority Upper Trishiuli-3A Hydroelectric Project (UT-3A HEP) is Grant 0182 and Grant 0183), Electricity Transmission a run of river project with an installed capacity of 60 MW. Expansion and Supply Improvement Project (ADB The project is located in Rasuwa and Nuwakot districts Loan 2808, Grant 0270 and Grant 0271) and Project of Bagmati zone with the head works located at Salletar Preparatory Facility for Energy (PPFE). 20 km north of Trishuli bazaar. Following the earthquake of 25th April 2015 and 12th May 2015, the access road to the project site, 11 kV transmission line to the NEA’s Subsidiary Companies and the Private headworks and many construction equipment have been Participation heavily damaged. Due to the influence of the earthquake, Chilime Hydropower Company Limited (CHPCL), the contractor has retreated all Chinese labor back to China first subsidiary company of NEA, has been successfully and dismissed all local labors. Although the access road delivering deemed as well as excess energy to NEA to Powerhouse has been opened, the access road to from its Chilime Hydroelectric Power Plant. CHPCL is surge shaft and headworks are still to be cleared. A high undertaking the development of Upper Sanjen (14.6 level team shall be mobilized for detail assessment of MW), Sanjen (42.5 MW), Rasuwagadhi (111MW) and the damage due to the impact of earthquake at project Middle Bhotekoshi (102 MW) Hydroelectric Projects.