India Boosts Nepal's Power Exports with New 251 MW Deal, Total Reaches 941 MW

New Delhi, Aug 20 (KNN) In a significant development for South Asian energy cooperation, India has greenlit an additional 251 megawatts (MW) of electricity imports from Nepal, bringing the total power export from the Himalayan nation to 941 MW.

This move not only strengthens Nepal's position as a net electricity exporter but also marks the first instance of Nepal supplying power to Bihar under a medium-term sales agreement.

The Indian Embassy in Nepal announced that the country's Designated Authority for Cross-Border Trade has approved power exports from 12 new hydropower projects in Nepal.

This expansion builds upon the existing framework, which previously allowed for 690 MW of electricity exports from 16 projects.

The rapid growth in Nepal's power export capacity is noteworthy. In October 2021, India approved just 39 MW of electricity exports from Nepal.

In less than three years, this figure has surged by more than 24 times, underscoring the accelerated pace of energy cooperation between the two nations.

Nepal's emergence as a net exporter of electricity has had significant economic implications. In the last fiscal year, the country generated NPR 16.93 billion in revenue from electricity sales, transforming its energy sector into a profitable venture.

The bilateral energy trade has evolved from Nepal's initial participation in India's Day Ahead Market to now include access to the Real-Time Market.

Furthermore, Nepal Electricity Authority has secured medium-term power sales agreements with distribution companies in Haryana and Bihar, diversifying its export portfolio.

India has further incentivised power purchases from Nepal by allowing hydropower imports to count towards the Hydropower Purchase Obligation (HPO) for Indian buyers. This policy change is expected to stimulate increased demand for Nepalese hydropower.

Looking ahead, both countries have set ambitious targets. A long-term power trade agreement envisions the sale of up to 10,000 MW of power from Nepal to India over the next decade.

With approximately 1,000 MW of exports already achieved in the first year, the agreement appears to be on a promising trajectory.

Nepal's energy ambitions extend beyond India. An agreement to sell 40 MW of power to Bangladesh has been finalized, though its signing was postponed due to recent political developments in Bangladesh.

This tri-national power trade could potentially position Nepal as the leading hydropower exporter in the South Asian region.

(KNN Bureau)