A meeting of energy secretaries of Nepal and India has agreed the investment modality for two 400 kv cross-border transmission lines and decided to conduct the feasibility study for more such lines aimed at facilitating power trade between the two countries.

Suresh Acharya, secretary at the Ministry of Energy and his Indian counterpart, Pankaj Agarawal, led their respective delegations at the 12th meeting of the joint steering committee, which concluded on Wednesday.

The meeting finalised the investment modality for the construction of the two cross-border transmission lines—Inaruwa (Duhabi)-Purnia (Bihar) and Dodhara (Lamki)-Bareli (Uttar Pradesh)—through a joint venture involving entities from both countries, with a target completion date of 2030, a joint secretary who is participating in the meeting told the Post over the phone from New Delhi.

These agreements and understandings are expected to facilitate export of 16,000 megawatts of energy by 2035.

During construction, the Nepal Electricity Authority will cover 51 percent of the expenses for the proposed transmission lines within the Nepali territory and the Power Grid Corporation of India (PGCI) will bear 49 percent of the costs within the Indian territory. The NEA will invest 49 percent in the transmission line construction in India while PGCI will hold a 49 percent stake in the construction in the Nepali territory.

Although there were some breakthroughs, officials were struggling to sign the minutes. “We had a very positive discussion and meeting,” said Sandip Dev, joint secretary at the Ministry of Energy. “What we agreed in the past meetings has been more or less confirmed. We have agreed on several proposals.” Sources said the signing is expected to take place on Thursday.

A joint venture company will be set up for the construction of the two transmission lines. The procedure for setting up such a joint venture will be completed within a month, according to the joint secretary.

The two sides had already agreed on the investment modality during a January meeting at the joint secretary level, but the decision needed to be endorsed by a higher mechanism, the joint steering committee.

By 2035, in addition to the two 400kV transmission lines, three more cross-border lines of 400kV and 220kV capacities will be constructed, and the meeting has agreed to conduct feasibility studies for these lines. These include the 400 kV Nijgadh (Bara)-Motihari (Bihar); the Kohalpur-Lucknow (Uttar Pradesh); and the 220 kV double circuit Chameliya-Jaulajiwi cross-border line.

The Chameliya-Jaulajiwi line is expected to be completed by December 2027 and its detailed project is set to be finalised by March.

Meanwhile, the construction of the 400kV Butwal-Gorakhpur line is underway. According to the Department of Electricity Development, 11,000 megawatts of electricity from various hydropower projects will soon be added to the national grid. Also, power purchase agreements for 20,000 megawatts have been proposed by developers, which are under the department’s consideration.

The two countries have already agreed to complete the Duhabi-Purnia transmission line by 2027-2028 and Dodhara-Bareli by 2028-2029, but the deadlines have now been slightly changed.

Similarly, in the last meeting, officials agreed to scale up the capacity of the 400kV Dhalkebar-Muzaffarpur line, which is currently the only high-capacity connection between the neighbours. The upgraded line will allow either country to import or export between 1,000 and 1,100 MW of energy, said Dev. This project will be completed by 2030.

With India promising to buy as much as 10,000MW from Nepal over the next 10 years under a long-term power trade deal, more high-capacity lines will be needed.

Four such high-capacity cross-border transmission lines are currently in the pipeline. The SJVN Arun-3 Power Development Company, the developer of the 900MW Arun 3 Hydropower Project, has been constructing a 400kV Dhalkebar-Sitamarhi line capable of transmitting up to 2,000MW.

Likewise, construction of the New Butwal-Gorakhpur Transmission Line, which will supply up to 3,500MW, is underway following its joint inauguration by then-Prime Minister Pushpa Kamal Dahal and his Indian counterpart Narendra Modi in June 2023.