The economy of Nepal is engulfed by a wave of optimism, thanks to a newly formed stable government (a full five-year term) that the country has been aspiring to since the restoration of democracy in 1990. Among various other factors, the rise in economic activities is triggering the demand for energy. This is expected to create immense prospects for the market participants, especially those involved in the distributed energy resources (DERs) sector.
Distributed energy resources (DERs) have huge potential in Nepal to rapidly increase the energy access across the country. The country has an estimated hydro potential of more than 42GW. Additionally, Nepal has strong growth potential in the solar and wind sector with an estimated capacity of over 10GW. With a decline in solar and wind costs, thanks to the technological advancements, the country is an ideal destination for a sustainable energy mix. However, a clear regulatory framework and adequate investments along the energy value chain are necessary to realize the renewable revolution in the country.
With electricity theft in the country ranging from 20% to 55%, the Nepal Electricity Authority (NEA) is taking stringent action to minimize the feeder loss. Investment in power projects across the country and proposed investment in the improvement of grid infrastructure will bring remote areas that are without service into the grid network. NEA envisions that deployment of smart meters will help them lower aggregate technical and commercial (AT&C) losses and improve overall reliability and resiliency of their networks. Pilot projects for the installation of smart meters are being carried out in Kathmandu Valley. Its commercial deployment is expected to start in 2019 in phases. The NEA plans to install more than 90,000 smart meters in the next 3-5 years beginning in 2019.
The current government has emphasized clean energy technologies and high-voltage transmission lines to take the power from generation point to demand centers. The government has plans to commission over 30 substations connecting more than 8,000 kms of transmission lines by 2035. Since reliable transmission lines are essential for transmitting the power from various hydro plants, Frost & Sullivan predicts strong market opportunities for high-voltage T&D solution providers in Nepal.
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