Nepal will export only 40 megawatts (MW) of electricity to Bangladesh from 15 June, as India has withheld approval for an additional 20 MW export, energy officials have confirmed.
The Central Electricity Authority (CEA) of India has stalled the approval to increase the supply to 60 MW, citing transmission line capacity constraints, reports The Kathmandu Post.
Officials noted that further procedures are now required, including a revised or new tripartite agreement and a decision from Nepal–India Energy Secretary-level Joint Steering Committee (JSC).
Technical hurdles
The Nepal Electricity Authority (NEA) had formally requested NTPC Vidyut Vyapar Nigam Limited India (NVVN) to facilitate the additional export. However, NVVN informed officials that the 1,000 MW India–Bangladesh transmission line could not accommodate the extra allocation.
“This time, only 40 MW of electricity will be exported to Bangladesh,” said Tharka Bahadur Thapa, director of NEA’s electricity trade department.
He explained that while the process had been initiated through NVVN at India’s CEA, the response indicated a lack of capacity in the transmission line for the additional 20 MW.
The proposed expansion will now depend on decisions from the upcoming Nepal–India JSC meeting and the secretary-level Joint Working Group (JWG) meeting in Nepal, neither of which has been scheduled yet.
Existing arrangements
The current 40 MW export arrangement was finalised following a JSC meeting on 5 January 2024, which allowed Nepal to use India’s transmission system.
A tripartite agreement was subsequently signed on 3 October 2024, between the NEA, the Bangladesh Power Development Board (BPDB), and NVVN. Under this deal, 40 MW is exported annually from 15 June to 15 November.
Nepal’s electricity is transmitted via the Dhalkebar–Muzaffarpur 400 kV line into India and then through the Baharampur–Bheramara 400 kV line into Bangladesh.
The power is generated by the Trishuli and Chilime hydropower projects, which will require separate Indian approval for any additional export volumes.
Financial terms
Nepal sells electricity to Bangladesh at 6.40 US cents per unit, a rate that is also intended to apply to the additional 20 MW. Unlike trade with India, which is conducted in Indian rupees, transactions with Bangladesh are settled in US dollars.
In the first ten months of the current fiscal year, Nepal’s electricity exports to India and Bangladesh reached Rs20.9952 billion, up from Rs13.1033 billion during the same period the previous year.
To date, Nepal has obtained approval to export a total of 1,165 MW to both countries combined.
