Taxing power, wasting opportunity: Nepal should reward households for switching to clean energy
Summary
Nepal should withdraw the new 5-percent VAT on household electricity use above 50 units a month and instead reward households for shifting to clean energy. The article argues that taxing electricity while importing costly petroleum products and LPG undermines energy security, public health, and the country’s transition to electric cooking and transport.
Key Points
- The new 5-percent VAT on household electricity above 50 units is portrayed as penalizing families that are shifting from imported fuels to cleaner domestic power.
- Nepal is still spending heavily on petroleum imports while hydropower generation is often underused during the monsoon because domestic demand remains too low.
- The article urges targeted support for induction cooking, electric vehicles, smart meters, and time-of-use tariffs instead of blanket fossil-fuel subsidies and electricity taxes.
- It cites government energy targets and argues that grid upgrades should accompany electrification rather than be used as a reason to discourage it.
