Nepal, India, Bangladesh to sign tripartite power trading deal on July 28

Nepal to Sign Historic Tripartite Power Trading Deal to Export Electricity to Bangladesh via India

New Delhi: Nepal is set to sign a tripartite power trading agreement next week to export 40 MW of electricity to Bangladesh via India, a senior official said on Thursday.

This historic agreement marks the first time the Himalayan nation will sell electricity to a third country other than India.

"Ground has been cleared for the three countries to sign the agreement on exporting electricity to Bangladesh," said Chandan Kumar Ghosh, spokesperson at the Nepal Electricity Authority (NEA), the government-owned electricity body.

The Power Sales Agreement will be signed by officials from the NEA, the Bangladesh Power Development Board (BPDB), and NTPC Vidyut Vyapar Nigam Ltd (NVVN) of India at a function here on July 28, Ghosh said.

Nepal's Minister for Energy, Water Resources and Irrigation, Dipak Khadka; India's Power Minister, Manohar Lal Khattar; and Bangladesh's Power, Energy and Mineral Resources Minister, Nasrul Hamid, will witness the signing ceremony, he said.

Details of the Agreement

Under the agreement, the NEA will export 40 MW of hydroelectricity to Bangladesh via India from June 15 to November 15 every year. Nepal will receive a tariff of USD 0.064 per unit for selling electricity to Bangladesh.

The energy will be transmitted to India through the 400kV Dhalkebar-Muzaffarpur cross-border transmission line. India will then transmit the equivalent to Bangladesh. The delivery point will be a 400kV substation at Muzaffarpur in India, and Bangladesh will pay the transmission charge for using the Indian transmission infrastructure.

According to an estimate by the NEA, Nepal will earn around Rs 330 million through the sale of electricity.

Background and Future Plans

Last month, a meeting of the ‘Cabinet Committee on Government Purchase’ of Bangladesh approved a proposal to import 40 MW of electricity from Nepal.

In January, Nepal signed a long-term agreement for the export of 10,000 MW of power to India and jointly inaugurated three cross-border transmission lines during the two-day visit of External Affairs Minister S. Jaishankar to the Himalayan nation.

Nepal has prepared an energy development strategy with the intention of producing 28,000 MW of electricity in the next 12 years. Of that, a target has been set to export 15,000 MW to different countries, including India, according to Nepalese media.