Nepal's power sector may lose competitive advantage to India's new policy
Nepal's power sector fears that they will lose the competitive advantage in the Indian market following New Delhi's recent decision to waive off the Inter-State Transmission System (ISTS) charges to India's hydropower projects, a move they say will severely hit their exports.
On December 2, India's Power Ministry announced a waiver of ISTS charges on wheeling electricity for 18 years for new hydropower projects.
The waiver is already available to solar and wind power projects.
The government has set an ambitious plan to have 500 GW of generation capacity from non-fossil energy-based sources by 2030.
The waiver is applicable exclusively to domestic Indian power producers and power exported from Nepal is not entitled to this concession.
In essence, this will make hydropower generated by Indian companies cheaper than what is being produced by Nepal, according to hydropower experts here.
The waiver is already available for wind and solar projects.
"This is an internal matter of Indi