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Nepal announces subsidy scheme to boost renewables

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Kathmandu, May 26, 2016: Nepal has announced a new subsidy policy for renewable energy, which aims to help earthquake survivors and tackle the energy crisis facing the Himalayan nation.

The revised policy, endorsed by the government on Monday, offers 80 percent subsidies for renewable energy technologies to families who lost their homes in last year’s earthquake.

“By implementing this policy, we hope to minimize our dependence on traditional and imported fuel and increase access to renewable energy especially in rural regions,” said Ram Prasad Dhital, executive director of Alternative Energy Promotion Center (AEPC), the state body promoting renewable energy.

“The goal of the policy was to assist marginalized communities and encourage public-private partnership,” Dhital said in a statement on Monday.

The scheme covers solar home systems, micro hydro plants and biogas plants.

Earlier, the government had offered 30 to 40 percent subsidies to marginalized communities and urban residents.

“In addition to that, we have offered more subsidies to households headed by women, earthquake survivors, indigenous people and Dalits (so-called untouchables),” Dhital said.

Micro hydro plants with maximum capacity of 100 kilowatts are eligible for the new subsidy policy, which, however, places a cap of 400,000 Nepali rupees ($3694) per kilowatt.

Similarly, for solar home systems, up to 20-kilowatts qualifies for 75 percent of the subsidy. The beneficiaries are obliged to buy the system from over 100 suppliers who are pre-qualified by the AEPC.

Last year, a 7.8 magnitude earthquake and a series of aftershocks struck Nepal, which killed over 9,000 people and destroyed or damaged 700,000 homes, schools and office buildings.

Eighty percent of the country’s energy needs are met by biomass while 74 percent of the population has access to electricity.

The country, despite immense hydropower potential, has lagged behind in development, forcing it to import petroleum products and cooking gas from its neighbor India.

Nepal has a target to provide clean energy to all of its citizens by 2030. The government-led, donor funded subsidy campaign has supplied 1.2 million improved cooking stoves, 350,000 biogas plants and 700,000 solar systems across the country, according to the AEPC.

By Deepak Adhikari