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Workshop on Energy Infrastructure Insurance

Nepal Bankers’ Association (NBA), Independent Power Producers Association (IPPAN) and USAID-Urja Nepal jointly organized a Workshop on Energy Infrastructure Insurance. The workshop aimed to discuss and emphasize the critical role that the insurance plays in mitigating risks associated with energy infrastructure projects. Showcasing the international best practices and success stories in insuring energy infrastructure the program also aimed to identify common bottlenecks and challenges hindering the adoption of insurance in the energy sector.

Urja Nepal Objective 3 Lead Ms. Usha Khatiwada delivered the opening remarks and provided an overview of the workshop. During the program, Energy Specialist of USAID Nepal, Mr. Shankar Khagi emphasized the pivotal role of the energy sector can play in driving Nepal’s economic towards the posteriority. He also highlighted the Urja Nepal’s efforts to enhance the reliability and affordability of the energy sector for all, particularly focusing on making hydro energy more cost-effective and environmentally sustainable.

During the program, IPPAN President Mr. Ganesh Karki emphasized the abundant potential for hydroelectric power generation in Nepal. He pointed out that despite the country’s rich resources, absence of substantial support from the banking sector poses a significant barrier. As energy producers increasingly prioritize large-scale projects, the demand for capital rises substantially. Mr. Karki stressed that Nepalese banks have a pivotal role to play in bridging this financial gap.

NBA President Mr. Sunil KC highlighted the substantial investment made by banks, exceeding 325 billion into Nepal’s hydropower sector. He expects a further surge in investment in the energy sector in near future, given its paramount importance as Government’s priority. Mr. KC also emphasized Nepal’s vulnerability to climate change, acknowledging the risks associated with climate-related issues. In response to these challenges, he stressed the necessity of implementing robust strategies to effectively manage and mitigate the risks posed by climate change within the energy sector. Furthermore, he said, insurance serves as a safeguard, providing protection against potential risks and uncertainties associated with energy ventures.

Keynote Speaker of the Program, Mr. Surya Silwal, Chairman of Nepal Insurance Authority highlighted that insurance constitutes as a strong pillar of the financial sector, particularly in Nepal, where significant financial losses occur annually and the role of insurance in protecting against such losses is high. He further emphasized the need of awareness in insurance and collective action in addressing the issues related to insurance. In his address, as a regulatory authority, he expressed willingness to engage with stakeholders and resolve their concerns.

Throughout the workshop, various presentations and panel session were delivered covering a range of topics including insurance products, re-insurance in the energy sector, opportunities for the insurance sector in Nepal’s energy industry, international perspectives on insurance, and risk engineering and loss assessment in hydropower. The discussion followed by the presentation was very productive and fruitful, where the participants asked relevant questions and shared their opinions, The program was attended by government officials, officials from Commercial banks, IPPAN officials, concerned stakeholders among others.