Nepal to Export 251 MW of Hydropower to India, Expanding Energy Trade
Nepal is set to export an additional 251 MW of power to India from 12 hydropower projects, following approval from India’s designated authority for cross-border trade. This marks the first time Nepal will export power to Bihar through a medium-term power sales agreement, as announced by the Indian Embassy in Kathmandu.
This new approval increases Nepal’s total power export to India to 941 MW from 28 projects. Even before this approval, Nepal had already become a net exporter of electricity, generating NPR 16.93 billion in revenue last fiscal year.
In October 2021, India approved 39 MW of power exports from Nepal for the first time. In less than three years, this figure has grown more than 24 times. Initially, Nepal began its power exports by selling in the Day Ahead Market of the Indian Energy Exchange. Since then, India has also granted access to the Real Time Market.
The Nepal Electricity Authority has entered into medium-term power sales agreements with discoms in Haryana and Bihar. India has also included hydropower imports from Nepal as part of its Hydropower Purchase Obligation (HPO), incentivizing buyers to purchase power from Nepal.
The long-term agreement between India and Nepal envisions the sale of up to 10,000 MW of power from Nepal to India over the next 10 years. In the first year of the agreement, around 1000 MW exports have already been reached. With these developments, Nepal is on track to become the leading hydropower exporter in South Asia.
An agreement for the sale of 40 MW of power to Bangladesh has also been finalized but was postponed due to recent political developments in Bangladesh.
Doubts Revealed
MW -: MW stands for Megawatt, which is a unit of power. It is used to measure how much electricity is being produced or used.
Hydropower -: Hydropower is electricity generated by using the energy of moving water, usually from rivers or dams.
Cross-border trade authority -: This is a group or organization that makes rules and gives permission for trading goods and services between two countries.
Net exporter -: A net exporter is a country that sells more goods or services to other countries than it buys from them.
NPR -: NPR stands for Nepalese Rupee, which is the currency used in Nepal.
Fiscal year -: A fiscal year is a 12-month period used by governments and businesses for accounting and financial purposes. It may not always start in January.
Bihar -: Bihar is a state in eastern India, known for its rich history and cultural heritage.
Haryana -: Haryana is a state in northern India, known for its agriculture and industrial development.
Bangladesh -: Bangladesh is a country in South Asia, located to the east of India. It is known for its rivers and rich cultural history.
