Analysis

Nepal’s dry session power import from India to go up

Debasis Sarkar

energy

Though rich in hydropower, crunched in production capacity, Himalayan country Nepal is going to increase its power import from India. While brightening Nepal’s dry winter time power profile, the trade will help India also in remaining as strong contender to explore the hilly nation’s huge untapped hydropower potential.

Nepal imports as high as 500 MW during peak hours. The figure is expected to shoot up much higher during next winter with the steady rise in Nepal’s power demand.

As Nepal Electricity Authority (NEA) Deputy Managing Director Rajeev Sharma puts it, “This import from India is too vital to handle the dry season demand of Nepal that is mostly hydropower dependent.”

Against Nepal’s peak electricity demand hovering at around 1300 MW, its generation capacity stands at around 1100MW. But, the output often goes lower than 60% during dry winter compelling the country to import power.

Both the countries have agreed to continue with existing Power Purchase Agreement till September 2019. The cross border power trade is done through Indian nodal agency NTPC Vidyut Vyapar Nigam (NVVN) and Nepal Electricity Authority.

Interestingly, “Seamless supply of this small amount of power to Nepal is important for India too. Stronger Indo-Nepal bondage developed with this can make India a stronger contender to grab power production contracts in the hilly country pushing others like China aside,” said experts in power trade sector.

Ironically, with 6,000 water streams, Nepal hosts 40 gigawatts of untapped potential. But, “It is not possible for Nepal alone to harness this,” said NEA officials.

“Any unutilized hydropower potential is a great loss. Nepal being physically and diplomatically so close, is a great place for India to explore,” said Debojit Chattopadhyay Executive Director NHPC.

According to a USAID supported study report ‘South Asia Regional Initiative for Energy Integration,’ Nepal hosts a cumulative investment potential of USD 36 Billion for the period till 2030. Here lies the opportunity for external power sector players including those from India. China is also equally keen on utilizing Nepal’s untapped hydropower potential and has already bagged contract to develop few plants there. Nepal has just revived a deal with a Chinese state-owned firm to construct a USD 2.5 billion hydroelectric plant, which had been scrapped earlier.

Originally published on economictimes.indiatimes.com on 25 October 2018

Published on Lokantar on 26 October 2018

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