October 24, 2021, Sunday
Nepal 1:37:26 pm

Nepal – Bangladesh agree to jointly develop hydropower project

The Nepal Weekly
September 21, 2021

Yet to settle the transmission system

By Purna N. Ranjitkar

Nepal and Bangladesh are agreed to jointly develop the 683 MW Sunkoshi III storagetype hydropower project. Final decision to this effect is expected to reach by next December as it takes time for discussions on the structure and process of project construction.

The meeting of energy secretaries of the two countries held recently in Kathmanduhad decided to move the Sunkoshi III forward after Bangladesh agreed on it. The Sunkosi III is one among five different projects Nepal had proposed to Bangladesh. This is the first agreement reached the government level for the construction for mutual benefit.

Bangladesh wants to import a total of 9,000 MW of electricity from Nepal by 2040. Bangladesh, which is looking for resources to address the growing energy requirement, is keen to invest with Nepal in both the government and private sectors as well.

During the visit of the then Minister for Energy, Water Resources, and Irrigation Barshaman Pun to Bangladesh in August 2019, Bangladesh had proposed to Nepal for construction of a reservoir project at the government level. According to the same proposal, the ministry had formed a technical committee for studies. During the visit of the President of Bangladesh and the Minister of State for Energy to Nepal, it was proposed to build a hydropower project jointly or in a single party investment.

The recent bilateral accord has brought big hopes for Nepal in widening possibilities of developing joint investment projects in Nepal and sale electricity to Bangladesh. This is more important that Nepal is looking for spill over electricity to sale in India these days. The authorities in Nepal side are hopeful to get the deal materialised at least to export electricity from Nepal in wet season and import in dry season. The deal would be labelled successful when the price of exported energy, imported energy and cost of transmission becomes comfortable to both parties.

Coming back to Nepal – Bangladesh cooperation, this is to be noted that Bangladesh has expressed interest in developing hydropower projects in Nepal. The two countries even signed an agreement to develop several hydropower plants capable of generating more than 1,600 MW.

The then commerce minister RomiGauchanThakali and his Bangladeshicounterpart Tofail Ahmed signed the pact on the side-line events of the Ninth South Asian Economic Summit in October 2016 to execute the 1,110 MW Sunkoshi II and 536 MW Sunkoshi III located in central Nepal.

Bangladesh requires reliable supply of electricity generated by renewable energytechnologies. Its demand in the industries and domestic sector is growing rapidly. Hydropower or renewable energy has been a priority for Bangladesh where it is generating electricity from natural gas and coal mainly.Thus, Bangladesh can take benefit of Nepal’s potential investing jointly.

As the both countries are members of South Asian Association for Regional Cooperation (SAARC) and Bangladesh, Bhutan Indian and Nepal (BBIN), the sub-regional forum. Thus, Nepal expects cooperation of India for Nepal – Bangladesh electricity trade. A trilateral transmission contract may be aneffective instrument for this matter to be materialised.

Nepal and Bangladesh are close neighbours. India is in between these two with a minimum stretch of 21 kilometres of land which is known as ‘Chicken’s neck’ also. So electricity trade between Nepal and Bangladesh has to pass through this part of India. India has been expected to provide an amicable access to Nepal and Bangladesh. Nepal and Bangladesh must have offered wheeling charge for using the transmission system India has developed in its land which can connect Nepalese and Bangladeshi transmission systems. However, the present situation is not that much expectable. The possible solutions have been discussed in the bilateral and trilateral forums in the past. But a solution agreeable for all three needs to be churned out as soon as possible. That will be a big benefit for Nepal as this may allow Nepal to sale its electricity to Bangladesh at a reasonable price.

Therefore, Nepal’s diplomatic efforts should be highly influential to bring all to be agreed on a solution that is good for all and Nepal may get desirable benefit.

In the meantime, the Ministry of Energy, Water Resources and Irrigation source had mentioned that the negotiation process for transmission through India’s cooperation is developing. I will be like to be materialised to get a positive status. So as Nepal will be able to export electricity to Bangladesh by mid-April of 2022. In the first phase Bangladesh will receive 200 Mega Watt. If so, this will be an opening for Nepal to sale electricity to Bangladesh in an extended amount anytime soon. However, upgraded transmission system may support this trade better in future.