Nepal Begins Electricity Export to India as Hydroelectric Production Increases – South Asia Time

Nepal Begins Electricity Export to India as Hydroelectric Production Increases

 June 16, 2023  

KATHMANDU, June 15 – Nepal has commenced exporting its surplus electricity to India following an increase in hydroelectric production due to rising water levels in rivers.

According to the Nepal Electricity Authority (NEA), the country has been exporting over 300 MW of electricity daily for the past five days. Suresh Bahadur Bhattarai, spokesperson for the NEA, stated that electricity is being sold at a rate of Rs 8.38 (IC 5.24) per unit.

Bhattarai attributed the increased rainfall in recent days as the primary reason behind Nepal’s ability to export electricity to India. He further mentioned that the electricity export is likely to continue until mid-November.

Simultaneously, domestic electricity consumption within Nepal has also surged. NEA records indicate a daily peak load of up to 1,900 MW, mainly driven by increased use of electrical appliances due to higher air temperatures. To manage the growing demand, the NEA has been importing 1,000 MWh of electricity daily from India.

Nepal’s installed capacity for electricity production has reached 2,700 MW, with full production achieved during the rainy season. Considering the excess supply of electricity compared to domestic demand, it is necessary for Nepal to export its surplus production.

Presently, India has permitted Nepal to sell only 452 MW of electricity in the Indian market. Due to this limitation imposed by the neighboring country, Nepal faced a loss of approximately 500 MW of electricity during last year’s peak season.

Nepal has been requesting India to purchase up to 1,200 MW of its electricity production, but India has not yet given approval for the increased export.

Last year, Nepal’s state-owned power utility began selling surplus monsoon electricity through competition in the day-ahead market of the Indian Energy Exchange Limited (IEX). The country earned revenue of Rs 11 billion from electricity exports to India during that period.

The successful initiation of electricity export to India marks a significant milestone for Nepal’s power sector and highlights the potential for further collaboration in the future.