Nepal exported electricity worth Rs 13.04 billion to India in the first five months of the current fiscal year 2024/25, according to the Nepal Electricity Authority (NEA).
The NEA reported the export of 1.76 billion units of surplus electricity from mid-July to mid-December, with an average export price of Rs 7.39 per unit.
Electricity was sold through the Indian Energy Exchange (IEX) on a competitive basis and via bilateral medium-term power purchase agreements with the Indian states of Haryana and Bihar. All transactions were conducted in Indian Rupees (INR), earning Nepal INR 8.15 billion.
The highest revenue of Rs 4.15 billion was recorded between mid-July and mid-August, while the lowest revenue, Rs 281.4 million, was generated between mid-November and mid-December. In the other months, exports earned Rs 3.68 billion (mid-August to mid-September), Rs 3.07 billion (mid-September to mid-October), and Rs 1.87 billion (mid-October to mid-November).
NEA Managing Director Kulman Ghising stated that floods and landslides in late September severely affected operations at the 456 MW Upper Tamakoshi Hydropower Project, reducing production and exports. The onset of the dry season further decreased river water levels, curbing hydropower generation and necessitating early electricity imports from India to meet domestic demand.
The NEA has set an ambitious target of exporting Rs 30 billion worth of electricity in the current fiscal year, ending mid-July 2025. However, damages to hydropower plants and transmission infrastructure caused by natural disasters have made this goal challenging.
Repair work on the Upper Tamakoshi project is ongoing, with operations expected to resume by the second week of January. In the meantime, the NEA has reintroduced load-shedding in industrial areas during peak evening hours, marking the first official power cuts in six-and-a-half years.
Although NEA ended load-shedding for residential consumers in 2017 and for industrial users in May 2018, industrialists have frequently reported undeclared power cuts even during monsoon seasons.
The NEA has secured approval to export 941 MW of electricity from 28 projects to the Indian market under competitive bidding and medium-term agreements.
In the previous fiscal year, Nepal imported electricity worth Rs 16.93 billion from India while exporting Rs 17.06 billion, becoming a net electricity exporter for the first time in three years after entering an energy deal with the Southern neighbour.
On November 15, Nepal exported 40 MW of electricity to Bangladesh, marking a significant milestone.
On October 3, 2024, Nepal, India, and Bangladesh signed a historic tripartite agreement in Kathmandu, enabling Nepal to export electricity to a third country for the first time. Under this agreement, Nepal will sell 40 MW of electricity daily to Bangladesh during the wet season for five years using Indian transmission lines. This arrangement, at a rate of 6.4 US cents per unit, is expected to generate $9.216 million in revenue from the sale of 144,000 megawatt-hours of electricity between mid-June and mid-November.
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