by Kamal Dhital
Power Exports to India: Driving Energy Trade
The Nepal Electricity Authority has resumed energy exports to India from Friday. The export, which had been suspended since last January, resumed on Friday night. The Authority announced that electricity export has started after an increase in water flow in the rivers resulted in increased production.
On Friday night, in a span of six hours, the Authority exported 600 megawatts of electricity to India, according to spokesperson Suresh Bahadur Bhattarai.
The Authority’s statement mentions that electricity export has resumed due to increased electricity production following the rise in water flow in the rivers. Bhattarai informed that electricity production had reached 1,300 megawatts with the increased water flow. “We have sent 600 megawatts of electricity to India on Friday night,” he said. “Once the transmission line condition is checked and electricity increases, we will gradually increase the export.”
Nepal sets goal of exporting energy worth NPR 20 billion to India this year, driving economic growth and bilateral trade.
Bhattarai mentioned that there is a provision to export electricity to India through the Day-Ahead market at a competitive price. He also stated that the bidding process has not been conducted for Sundays. He further mentioned that as the infrastructure improves in the coming days, sales are expected to increase gradually. The export of electricity was halted from the first week of last January due to decreased water flow in the rivers.
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The Authority had earned Rs. 8.43 billion by exporting electricity to India from the month of Saun of last year to Poush. The Authority aims to export around 20 billion units of electricity in the current fiscal year.
The Authority started exporting electricity to India from Kartik of the previous year. The Authority had initiated the sale of 39 megawatts of electricity produced from two hydroelectric projects.
In Jestha of the previous year, it received permission to sell 364 megawatts of electricity at a competitive rate in the Indian market. In Kartik of the previous year, it received approval for two more hydroelectric projects for export. Along with this, the Authority has obtained permission to export a total of 452 megawatts of electricity to India from 10 projects. The Authority has not requested permission for the sale of additional electricity from the Indian side.
Currently, electricity sales are taking place based on the ‘Day-Ahead’ market in the Indian Energy Exchange. Electricity is bought and sold through bidding every day from 10 am to 12 pm. The selling rate is determined based on the ‘Market Clearing Price’ per unit, which is finalized through competitive rates from a day’s bidding. After determining the competitive rate from the bidding of the day, electricity can be bought and sold for 24 hours, starting from 12 pm of one day to 12 pm of the next day.
The Authority has imported electricity worth nearly Rs. 17 billion this year. Bhattarai mentioned that the import has been almost zero since the start of the dry season. The transmission line capacity is currently 2,700 megawatts. However, due to the lack of domestic production reaching around 30%, the import is still high, according to the Authority.
During the dry season, Nepal had to rely heavily on Indian electricity to meet its demand as the Nepali hydropower sector faced difficulties with reservoir-based projects and river-run projects producing around 850 megawatts of electricity. Along with the onset of summer, the demand for electricity increased in India as well, and Nepal was unable to meet the demand. The Authority stated that they imported around 500 meg
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