Forest Act Repeal Halts Development: President Karki
Ganesh Karki, the President of the Independent Power Producers' Association, Nepal (IPPAN), has stated that the repeal of the Forest Act by the Supreme Court has created a major obstacle for development. This legal confusion has stopped hydropower projects with a total capacity of nearly 25,000 megawatts from moving forward.
Legal Confusion Halts Major Projects
Mr. Karki explained that even though six to seven months have passed since the Supreme Court's decision, the full text of the verdict has not been released. This delay has prevented any projects from progressing. He emphasized that this situation is causing billions of rupees in losses for the country. The government had introduced the act through an ordinance, and even though parliament passed it, the Supreme Court repealed it, bringing development to a standstill.
Problems with Power Purchase Agreements and Policy
Currently, over 20,000 megawatts worth of projects are stuck because they cannot obtain a Power Purchase Agreement (PPA). One government department issues licenses for projects, but another authority refuses to grant the necessary PPAs. This contradiction has raised serious questions about the government's own policy and coordination.
Ineffective Stock Market and Restrictive Laws
Another method for raising investment in the energy sector, the stock market, has also not been effective. Mr. Karki pointed out that restrictive laws are creating pressure on projects. These include a legal requirement to give 10 percent of shares to locals and a mandatory rule to issue an Initial Public Offering (IPO). He argued that the law should be changed so that good projects are not forced to go through the IPO process.
Call for Long-Term and Clear Policy
President Karki stressed that the government must create a long-term and clear policy to solve this crisis in the energy sector. He believes that without a stable and well-defined plan, the country's development and energy potential will continue to suffer.
