Nepal Electricity Authority Makes Rs.2.84 Billion Profit: Auditor General’ Report

Nepal Electricity Authority Makes Rs.2.84 Billion Profit: Auditor General’ Report

April 13, 2019, 3:36 p.m.

At a time when a group of people are disseminating the news saying that Nepal Electricity Authority (NEA) has made over a billion loss, Auditors’ General’s, constitutional apex audit body, Annual Report of 2017/018 said that NEA’s net profit has reached to Rs Rs.2.84 billion. In its report, Auditor General said that NEA’s financial condition is healthy.

Released on Friday, the report said that Reserve Fund and Collection fund is now Rs.23.59 billion in credit compared to Rs.26.33 billion last year. The report says that ratio of profit margin has increased. Similarly, in ratio with liability and total spending, the losses in employees spending and distribution ratio have declined.

Auditor’s General’s Final Auditing showed that NEA is in net profit of Rs. 2.84 billion 8.1 million. When Kula Man Ghising was appointed NEA’s MD in August 2017, NEA was operating in Rs 8.89 billion net loss. Along with ending decade long chronic load shedding, Ghising is able to run NEA in profit due to his management capacity.

Under the leadership of Ghising, NEA has been taking several efforts to control electricity loss and administrative and financial reforms.

MD Ghising released NEA’s annual report in August 2018 predicting that the total profit will be over Rs.1.10 Billion. The actual profit for last fiscal year reached nearly Rs. 3 billion in final audit. Progress made in controlling electricity loss, import from Indi, declining of ratio of electricity purchase from private sector, control in maintenance and administration cost, ending load shedding and effective implementation of financial restructuring are the reasons to run NEA in profit.

In the last fiscal year, NEA was able to reduce the electricity loss to 20.45 percent. The loss in generation, transmission and distribution has declined last year to 2.45 percent compared to previous year. Last year, the loss was 22.90 percent.

Furthermore, NEA has already reduced the electricity leakage by 15.45 percent in the last five months of current fiscal year. NEA has set a target to bring the leakages by 18.5 percent in the current fiscal year. In the last fiscal year, transmission loss was 5 percent two previous years. It reaches 5.63 this year with increase of 0.63 percent. However, the distribution leakages reduced from 2 percent from 16.82 to 14.82. NEA has been launching leakage controlling, electricity theft, incurring remaining due and improvement of distribution transformer, distribution line and strengthening substation as a national campaign.

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