Analyzing Pure Energy Limited’s IPO Approval: A Deep Dive into Financial Viability and SEBON’s Decision

In a surprising move, Pure Energy Limited, a solar project with a total installed capacity of 20 MW, has recently received IPO approval from the Securities Board of Nepal (SEBON). This decision comes at a time when SEBON has been hesitant to approve IPOs for numerous hydropower projects in the pipeline. This raises an important question: On what grounds did Pure Energy Limited secure IPO approval, especially when SEBON has been cautious about protecting general investors from potential profitability risks?

 

Price Discrimination in Nepal’s Energy Sector: Challenges and Opportunities

 

The Government of Nepal has set an ambitious target to generate 28,500 MW of electricity by 2035, aiming to boost both domestic consumption and export capacity. This strategic initiative reflects Nepal's commitment to harnessing its hydropower potential, promoting sustainable energy development, and fostering economic growth through regional energy cooperation.

Key Aspects of the 2035 Energy Target

• Domestic Consumption: Approximately 13,000 MW is intended for domestic use, aiming to meet the growing energy needs of the country.
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• Export Capacity: Around 15,000 MW is planned for export, primarily to neighboring countries like India, to enhance foreign currency earnings and support regional energy integration.
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To achieve this target, the Department of Electricity Development (DOED) has already issued licenses for 30,000 MW of hydropower projects and 704 MW of solar projects. However, the current reliance on Run-of-River (RoR) hydropower projects raises significant challenges.