Lack of a tripartite deal and transmission line may delay power export to BangladeshNepal and Bangladesh recently agreed to request India for signing a trilateral energy sales and purchase agreement.
Although Bangladesh has shown interest to import Nepali electricity, it will not be easy for Nepal to export power without an official nod from India.
As Nepal and Bangladesh do not share borders and India lies between the two countries, India’s cooperation will be crucial to enable trading of electricity between Nepal and Bangladesh. Experts say a tripartite agreement is essential for this.
Bangladeshi Prime Minister Sheikh Hasina, during her state visit to India last week, formally requested India for passage to import electricity from Nepal.
As per the joint statement issued on September 7 at the conclusion of the visit, the Bangladeshi side asked India to provide passage for the import of power from Nepal and Bhutan.
And the Indian side replied that the guidelines for the same are already in place in India, the joint statement reads.
Nepali officials and experts say at least two factors—legal foundation and infrastructure—would be necessary to pave the way for export of power to Bangladesh from Nepal.
“Based on the joint vision statement on energy between Nepal and India, the southern neighbour appears willing to provide wheeling services to enable power trading between Nepal and Bangladesh,” said Posh Raj Pandey, executive chairperson of South Asia Watch on Trade, Economics and Environment (SAWTEE), a think tank based in Kathmandu. “But trading of power with a third country based on bilateral foundation will only be transactional. A trilateral agreement is a must to ensure smooth trade of electricity between Nepal and Bangladesh.”
He also suggested the need for signing a protocol to such a trilateral agreement, which will determine the terms and conditions of electricity exports to Bangladesh. Currently, Nepal and India are trading electricity with each other while India and Bangladesh are also trading electricity between them. But there is no trilateral agreement on power trade between the three countries.
Nepal and Bangladesh recently agreed to request India for signing a trilateral energy sales and purchase agreement.
During the secretary-level Joint Steering Committee (JSC) meeting on energy cooperation between Nepal and Bangladesh in Kathmandu last month, the Nepal Electricity Authority and the Bangladesh Power Development Board decided to request India’s NTPC Vidyut Vyapar Nigam (NVVN) for a trilateral energy sales and purchase agreement. They plan to trade power using the Baharampur-Bheramara cross-border power transmission line, which links India and Bangladesh.
The transmission line inaugurated in 2013 facilitates the exchange of 500MW of electricity.
Nepal and Bangladesh had decided to request India to allow Nepal to export 40-50MW of electricity to Bangladesh in the initial phase.
In line with the understanding reached in Kathmandu, Bangladesh raised the issue at the highest level in New Delhi last week. In response, India said it already has the Guidelines for Export/Import (Cross Border) of Electricity-2018, which has opened the door for a trilateral agreement and power trade between Nepal and Bangladesh.
Likewise, as per the Joint Vision Statement on Power Sector Cooperation issued in early April during Nepali Prime Minister Sher Bahadur Deuba’s India visit, the two countries aim to expand cooperation in the power sector to include their partner countries under the Bangladesh, Bhutan, India and Nepal (BBIN) framework, subject to mutually agreed terms and conditions between all involved parties.
“The vision statement talks about power cooperation in the BBIN region and Indian officials have also been assuring us that it would provide transmission access to enable energy trade between Nepal and Bangladesh,” Kul Man Ghising, managing director of the Nepal Electricity Authority (NEA), told the Post in April.
Officials said there is a possibility of Nepal exporting a certain amount of electricity to Bangladesh in the next rainy season. “If India’s NTPC Vidyut Vyapar Nigam agrees to the request of the Nepal Electricity Authority and Bangladesh Power Development Board for a trilateral energy sales and purchase agreement, it will convey the message that India alone is not our export market,” said Madhu Bhetuwal, spokesperson at the energy ministry.
The NVVN is the nodal agency of India to deal with cross-border power trade with both Nepal and Bangladesh.
Bangladesh has already decided to buy 500MW of electricity from the 900MW Upper Karnali Hydropower Project to be developed by India’s GMR Group, which has set up GMR Upper Karnali Hydropower Limited to develop the plant in Nepal.
During the fourth Joint Steering Committee meeting on energy cooperation in August, Bangladesh informed Nepal that it would be concluding the deal to buy 500MW electricity from the Upper Karnali Hydropower Project by September.
But there is concern over transmission connectivity between the project and Bangladesh. There is currently no high capacity transmission line close to the site of the proposed Upper Karnali Hydropower Project. “So it is necessary that the NEA, which has a nationwide transmission network, should be ready to provide open access to the GMR to enable it to sell its electricity to Bangladesh,” said Gokarna Raj Panth, secretary at Electricity Regulatory Commission.
“The government should decide whether to adopt an open access policy or not.”
There's also no cross-border transmission line close to the Upper Karnali project.
There has been talk between Nepal and India to build the Lamki-Bareli cross border transmission line, according to the NEA.
The country currently has single high capacity transmission line, i.e. Dhalkebar-Muzaffarpur Transmission line which can carry around 1000MW of electricity.
“Until more cross-border transmission lines are built, there is not much space left in the Dhalkebar-Muzaffarpur line to enable export of more power,” said Panth. “It will be difficult to accommodate the 500MW power of GMR in this transmission line.”
Pandey said that political factors may also hinder smooth supply of electricity to Bangladesh from Nepal. “Electricity to be exported by Nepal to Bangladesh will either go through West Bengal, Bihar or Uttar Pradesh which are also facing prolonged electricity shortages every year,” he said. “Supply of electricity to India through these states which face power shortages every year, may invite political blackclash and hamper smooth export of electricity from Nepal to Bangladesh.”