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How much has Nepal lost in the last decade due to load shedding? an economic assessment using a CGE model

Author

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  • Timilsina,Govinda R.
  • Sapkota,Prakash Raj
  • Steinbuks,Jevgenijs

Abstract

Nepal suffered with severe shortage of electricity supply or load shedding in the last decade. Electricity load shedding is considered one of the major barriers to the country's economic development. This study uses a computable general equilibrium model to estimate the economic costs of electricity load shedding the country faced during 2008-16. The study shows that if there had been no load shedding, annual gross domestic product, on average, would have been almost 7 percent higher than it was during 2008-16. The worst effects of load shedding were on the investment environment. If there had been no load shedding, investment would have been 48 percent higher than it was. Although electricity load shedding has been reduced recently in the residential sector through better electricity load management and increased electricity production and imports, the industrial sector, one of the main sources of economic growth in the country, still faces load shedding. Unless the electricity load shedding is eliminated, Nepal will continue to suffer a heavy economic loss.

Suggested Citation

  • Timilsina,Govinda R. & Sapkota,Prakash Raj & Steinbuks,Jevgenijs, 2018. "How much has Nepal lost in the last decade due to load shedding? an economic assessment using a CGE model," Policy Research Working Paper Series 8468, The World Bank.
    • Handle: RePEc:wbk:wbrwps:8468
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    Citations

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    Cited by:

    1. Tahir, Muhammad Faizan & Chen, Haoyong & Khan, Asad & Javed, Muhammad Sufyan & Cheema, Khalid Mehmood & Laraik, Noman Ali, 2020. "Significance of demand response in light of current pilot projects in China and devising a problem solution for future advancements," Technology in Society, Elsevier, vol. 63(C).
    2. Koirala, Dhiroj Prasad & Acharya, Bikram, 2022. "Households’ fuel choices in the context of a decade-long load-shedding problem in Nepal," Energy Policy, Elsevier, vol. 162(C).
    3. Timilsina, Govinda & Steinbuks, Jevgenijs, 2021. "Economic costs of electricity load shedding in Nepal," Renewable and Sustainable Energy Reviews, Elsevier, vol. 146(C).
    4. Nepal, Rabindra & Paija, Nirash, 2019. "Energy security, electricity, population and economic growth: The case of a developing South Asian resource-rich economy," Energy Policy, Elsevier, vol. 132(C), pages 771-781.
    5. Timilsina,Govinda R. & Hochman,Gal & Song,Ze, 2020. "Infrastructure, Economic Growth, and Poverty : A Review," Policy Research Working Paper Series 9258, The World Bank.
    6. Hashemi, Majid, 2021. "The economic value of unsupplied electricity: Evidence from Nepal," Energy Economics, Elsevier, vol. 95(C).
    7. Zubair, Muhammad & Awan, Ahmed Bilal & Rehman, Muhammad Muqeet & Khan, Mohammad Nadeem & Abbas, Ghulam, 2021. "Residential and commercial UPS User's contribution to load shedding and possible solutions using renewable energy," Energy Policy, Elsevier, vol. 151(C).
    8. Shakya, S.R. & Adhikari, R. & Poudel, S. & Rupakheti, M., 2022. "Energy equity as a major driver of energy intensity in South Asia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 170(C).
    9. Aryal, Sushil & Dhakal, Shobhakar, 2022. "Medium-term assessment of cross border trading potential of Nepal's renewable energy using TIMES energy system optimization platform," Energy Policy, Elsevier, vol. 168(C).
    10. Timilsina, Govinda & Steinbuks, Jevgenijs & Sapkota, Prakash, 2019. "Economy-wide Cost of Electricity Load Shedding in Nepal," Conference papers 333038, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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