Everest, Kathmandu, Oct. 2- The Electricity Regulatory Commission (ERC) has fixed transmission charges, also known as wheeling charges, for the use of the National Transmission Grid for the first time.

According to ERC, it has fixed the transmission charge for long- and medium-term open access to the National Transmission Grid at Rs. 412,755 per MW per month for fiscal year 2026/27. It has also set the transmission charge for short-term open access at 57 paisa per kilowatt-hour. With the implementation of ‘open access’ in electricity transmission, private sector promoters or consumers can now use the transmission lines by paying a fee (rental charge).

The commission fixed the charges by issuing the Standards for Calculation of Transmission Charges of the National Electricity Transmission Grid, 2026, in accordance with the provisions of the Directive on Open Access to Electricity Transmission and Distribution Systems, 2025.

The directive aims to ensure non-discriminatory access to the electricity system from generation and transmission to distribution.

Chairman of Electricity Regulatory Commission Dr. Ram Prasad Dhital said that the commission had fixed the charge to allow third parties or the private sector to use the electricity transmission system under the open market policy.

The charges have been determined based on the estimated annual revenue requirement (ARR) of the transmission system and the projected maximum load for the fiscal year.

According to the ERC, the estimated ARR of the transmission system for FY 2026/27 has been set at Rs. 17.77 billion, while the projected maximum load has been estimated at 3,587 MW. The standard provides for calculating the ARR based on accepted costs, including the capital assets of the transmission system, depreciation, interest on long-term loans, employee expenses, operation and maintenance costs, interest on working capital and return on equity.

The ERC reviewed the transmission system's ARR based on details submitted by the Nepal Electricity Authority and its audited financial statements for FY 2024/25. Following the review, the total ARR of the transmission system for FY 2024/25 was determined at Rs. 11.015 billion. The commission said the ARR for FY 2025/26 and FY 2026/27 was projected on the basis of an average annual growth rate of 27 per cent in the transmission system's ARR between FY 2021/22 and FY 2025/26.

The open-access framework allows electricity users to utilise the national transmission grid by paying applicable charges, including transmission system use charges, system operation charges, scheduling/metering/account settlement charges, deviation charges and charges for ancillary and balancing services, he said.

According to him, third parties or the private sector must pay wheeling charges to the Nepal Electricity Authority—in accordance with the standards and rates prescribed by the Commission—for exchanging electricity using transmission and distribution lines.

Dhital said that the standard is dynamic and can be reviewed in the coming fiscal years, as the charges will be fixed in the future based on variations in costs. He said that the work was underway to issue a separate directive for determining transmission charges for other radial and dedicated transmission facilities that do not fall under the National Electricity Transmission Grid.

Milestone in energy sector

Minister for Energy, Water Resources and Irrigation Biraj Bhakta Shrestha said that the decision to fix the wheeling charge, in response to demands from the private sector and the country's needs, would lay the foundation for developing an energy-based economy.

Minister Shrestha said that open access to the grid would encourage private-sector investment and help channel excess liquidity in the banking sector into the construction of transmission lines.  Secretary at the Ministry of Energy, Water Resources and Irrigation Dr. Jagadishwor Karmacharya said that fixed transmission charge would be milestone in the field of electricity trading. Nepal Electricity Authority (NEA) Managing Director Dirghayu Kumar Shrestha said that the determination of open-access transmission charges would be a milestone in achieving the government's electricity export goal. He said that this would support for ensuring market for electricity and open the pave for PPA of pipeline projects.

Senior Vice President of the Independent Power Producers' Association, Nepal, Uttam Bholan Lama, appreciated the fixing of transmission charges, saying that it had changed the narrative in the energy sector. He, however, said that the transmission charge fixed by the ERC might be high, as it would increase the cost of Nepali electricity and reduce its competitiveness against Indian electricity.