Prime Minister KP Sharma Oli and Congress President Sher Bahadur Deuba have agreed to remove the provisions of the 'take and pay' (take and pay) electricity purchase and sale agreement (PPA) in the budget.

An agreement was reached between Deuba and Oli in the Prime Minister's Chamber of the Parliament on Monday evening to remove the budget amendment message. 

Finance Minister Bishnu Paudel has informed the parliament that the provision has been removed from the budget and the cabinet meeting will formalize the agreement, according to sources. On Monday evening, Deuba called Prime Minister Oli and Finance Minister Paudel and asked them to remove the arrangement. "Party friends are not agreeing, it will be difficult if Take and Pay is not removed, the President's statement is that we should pass the budget only by removing it," said a Congress MP, quoting Deuba's statement.

In case of PPA in 'take and pay', the authority buys the quantity it needs and pays only for it. In the case of PPA in 'Take or Pay', the authority has to take electricity according to the agreement made with the promoter, otherwise it has to pay the price to the promoter. If the power is not provided as per the agreement, the promoter has to pay a fine to the authority. The Authority has been doing PPA on 'Take or Pay'. In the case that the hydropower project can be built but the new transmission line is not completed or the capacity of the transmission line is reduced, the authority has set a time limit for the PPAs made on the basis of 'Take or Pay' and takes and pays electricity on the basis of 'Take and Pay'.

Deuba pressured Prime Minister Oli to remove the provision of 'take and pay'. Since the introduction of this provision in the budget, Energy Minister Deepak Khadka has been saying that there will be 'take and pay' amendment from public programs and even in the parliament and he has not sent it in the budget. Even energy promoters and parliamentarians have been protesting against such a provision in the budget to help the private sector. But in the meeting of the House of Representatives on June 2, Finance Minister Poudel indicated that the provision would not be removed. He said that a law has been proposed in the House to enhance the role of the private sector in power generation, transmission and sales. 

Along with this, the Association of Independent Power Producers, Nepal (IPPAN) is applying pressure by announcing the first phase of the movement. In protest, IPPAN sent an SMS to the Prime Minister, Minister of Finance, Minister of Energy and Executive Director of Nepal Electricity Authority on June 7, requesting to withdraw 'Take and Pay'. 

On June 8, he even wrote a message on social media to withdraw the 'Take and Pay' PPA policy. Although it was said to discuss the impact of 'Tech and Pay' with various associations of the private sector on June 9 and publish a joint opinion, Ippan said that it could not be done as the president of the Federation of Nepalese Industry and Commerce Chandra Dhakal was abroad.

IPPAN has said that the project of 12,889 megawatts has applied for PPA in Nepal Electricity Authority. If 'Take and Pay' PPA is implemented, banks and financial institutions will not manage finances in PPAs based on 'Take and Pay' and 'Take or Pay' PPA of projects below 10 MW will be affected. 

They say that the construction of 17,117 megawatts, which has taken and applied for a survey and construction permit, is uncertain. IPPAN has stated that the investment made in the hydropower sector so far is 66 billion 22 million 14 million rupees. In a program organized by the Nepal Infrastructure Journalist Society on Monday, MPs and energy entrepreneurs said that the provision in the budget should be amended immediately to protect the energy sector. Deepak Bahadur Singh, chairman of the Parliament's Infrastructure Development Committee, says that the budget is biased and a fair decision will be taken to protect the energy sector.