Internal Dispute Erupts Within IPPAN, Nepal's Independent Power Producers Association

Kathmandu. An internal dispute has arisen within the Independent Power Producers' Association, Nepal (IPPAN), the umbrella organization of private investors in Nepal's energy sector.

The 24th Annual General Meeting and election of a new leadership have been scheduled for the upcoming Jestha 29. However, disputes have escalated within the organization even before the formal election schedule was made public, with factionalism emerging. Furthermore, issues concerning legality and amendment of the bylaws have also surfaced, creating further problems.

One faction of IPPAN has entered the electoral arena by announcing its panel for the election, while another faction has warned in writing to halt the process, stating that any election held without completing the mandate of the previous general assembly would be illegal. Allegations have begun to surface that this dispute within IPPAN is not merely limited to a struggle for leadership.

• Panel Announced Hastily, Disrupting Consensus

Traditionally, IPPAN has practiced selecting leadership through consensus as much as possible. Officials including the current executive committee's General Secretary Balram Khatiwada were lobbying for consensus until the last moment to preserve the organization's unity.

However, a group led by Vice President Uttam Lama, aspiring for new leadership, has announced its own panel. With one faction entering the electoral field by announcing its panel, the door for consensus appears to be almost closed for now.

The other faction alleges that this group, which is said to have a majority of businessmen close to communist ideologies, has created an atmosphere of mistrust within the organization by hastily announcing its panel. General Secretary Balram Khatiwada states that some colleagues have acted to spoil the atmosphere of consensus. He expressed concern that factional interests, rather than the organization's welfare, might tarnish IPPAN's dignity.

He said, 'While discussions were ongoing regarding the amended bylaws and the upcoming leadership, some colleagues announced their panel. However, some neutral businessmen have expressed dissatisfaction with this matter. This has not sent a good message.'

• Formation of Federation Improbable Immediately

The biggest challenge to IPPAN's 24th General Assembly comes from a written letter submitted by the organization's Deputy General Secretary Prakash Chandra Dulal. The letter accuses the current Chairman Ganesh Karki and his executive committee of disregarding the mandate and directives of the previous (23rd) General Assembly and attempting to proceed illegally.

According to the letter registered on Jestha 31, 2081, the 23rd General Assembly of IPPAN had unanimously decided to develop the organization as an umbrella body for the entire energy sector and transform it into a federation. That assembly also approved the report of the 'Bylaw Amendment and Redrafting Committee' formed under the convenership of Bhanubhakta Pokharel.

The current leadership has informed that it is not possible to form the federation immediately because the government itself has imposed a ban on IPPAN's transformation into a federation, despite the previous assembly mandating the formation of the federation within six months and holding elections under the new bylaws within one year thereafter.

Deputy General Secretary Dulal stated in his letter, 'The act of calling another general assembly without fulfilling the responsibility given by the 23rd General Assembly (to form a federation) is not only unethical but also legally problematic. Proceeding with the election process under the old bylaws will be illegal and contrary to the Societies Registration Act, 2034.'

There is a high risk that the process could be halted in court if the current executive committee attempts to force elections under the old structure without completing the transformation into a federation. The dissatisfied faction alleges that the leadership is merely playing a game to retain or transfer power by shelving the bylaw amendment draft prepared by the committee led by Bhanubhakta Pokharel over months.

Meanwhile, IPPAN Chairman Ganesh Karki stated that although the previous general assembly mandated the formation of a federation, it is not possible to form it immediately due to legal and procedural complexities. Therefore, he said, the election is being held under the old bylaws.

Chairman Karki said, 'Everyone had agreed to form a federation. However, due to various reasons, it will not be formed immediately. It seems it will take another 1-2 years for the federation to be formed as the government has stopped it. Since the federation will not be formed, there is no alternative but to go for elections under the old bylaws.' He clarified that it is ethically inappropriate to cling to power without holding elections when the 3-year term of his executive committee has already ended.

Chairman Karki stated that the dissatisfied faction has created a dispute based on the previous minutes, insisting on forming a federation before holding elections. He informed that when attempting to hold elections under the old bylaws due to the inability to form a federation, the dissatisfied faction has raised the question, 'Neither the new bylaws have been drafted, nor does the old bylaw permit elections?'

• Demand to Abolish Provision of Senior Vice President Automatically Becoming Chairman

The issue of the Senior Vice President automatically becoming the Chairman is another point of dispute within IPPAN. There have been demands to remove the provision in the bylaws that the 'Senior Vice President automatically becomes Chairman'.

According to IPPAN's current bylaws, an individual elected as Senior Vice President does not need to contest for the position of Chairman in the next term; they automatically become Chairman. This arrangement has been criticized for creating a syndicate within the organization and preventing new, capable, and energetic leadership from emerging, leading most members to strongly demand its abolition.

General Secretary Khatiwada stated that he also supports removing the mandatory provision that requires waiting 12 years to become Chairman after entering the executive committee. He said that their stance is to adopt a direct election system from the upcoming general assembly. The other faction states that if elections are held without amending the old bylaws, those elections will be meaningless.

It is being anticipated in the market that disputes within IPPAN, the representative body of the private sector considered the backbone of the energy economy, could lead to problems in the entire energy sector. The government has already signed an agreement to export 10,000 megawatts of electricity to neighboring India in the next 10 years. An ambitious national goal of generating 28,500 megawatts of electricity has been set for the same period.

Energy sector experts say that internal conflicts and factional disputes within the umbrella organization of the private sector, which is the main force for implementing these goals, are not conducive. They argue that at a time when the organization should be advocating with the government at the policy level, fighting to reform cumbersome laws related to forest and land acquisition, and creating an environment for attracting foreign investment, IPPAN officials should not be forming panels and fighting amongst themselves.

IPPAN Advisor Motilal Dugad has suggested making the election dispute-free and impartial. Dugad, giving a 4-point suggestion to the IPPAN Chairman, stated that only one person from the board of directors of the member company should be able to vote. He said that employees drawing salaries should not be allowed to vote as it is an association of promoters, and the voter's name should be certified by the incumbent chairman or company secretary.

He suggested making it mandatory to present one original document from citizenship, passport, national identity card, or driving license when coming to vote. He also stated that the path should be opened for individuals holding the positions of Chief Executive Officer or General Manager of member companies on the board of directors to also become candidates for the executive committee. Advisor Dugad said that it is necessary to completely prohibit the possibility of financial irregularities and fraudulent voting that could occur in past elections.

Meanwhile, IPPAN Chairman Karki stated that there is no significant dispute within the organization and a new leadership will be selected through elections at the scheduled time. He clarified that elections will be held on the scheduled date as friends have already announced their panels for the upcoming leadership.

He said, 'Although they said they would stop the election, they have already announced their panel. If they intended to stop the election, they probably wouldn't have come with a panel. Since they have also come to contest the election, the election is certain.' Chairman Karki stated that both sides should now work together and the upcoming leadership of IPPAN should be selected by holding elections on the scheduled date to conclude this matter.