New turn in Nepal-India power trade

Nepal and India have agreed, in principle, to engage in bilateral power trade on the basis of market-determined price mode (commercial mode), Rameshwar Yadav, managing director of the Nepal Electricity Authority and leader of the Nepali team engaged in power trade talks with India, said today.

At the meeting, Nepal sought the import of 100 MW from India immediately and additional import of 145 MW power in one year.

Chiranjivi Sharma, another team member and an NEA general manager, informed that India is positive about addressing Nepal’s power woes, referring to extended loadshedding hours that the country faces every winter.

“The Indian side has agreed to do its bit to upgrade the existing crossborder transmission lines,” Sharma said.

The two sides will have to agree on the funds they will be shelling for upgrading the existing infrastructure and the quantum of power to be imported from different points.

As per existing provisions, Nepal can import up to 50 MW from India. According to another Nepali team member, power import from Bihar costs Nepal a bit higher than the import from the Tanakpur project and West Bengal. Under the commercial mode, Nepal will be able to buy power at a cheaper rate.

At the meeting, the Indian side sought 5.50 per cent tariff hike on power that Nepal imports from Bihar, while the Nepali side proposed that the issue be discussed at the next fiscal. “If we do not go for commercial mode, we will have to pay more for power import from Bihar,” said Jayendra Shrestha, acting director (Finance) NEA.

Nepal has also agreed to buy 150 MW from India from June, 2015 as the high capacity (400-KV) Dhalkebar-Muzaffarpur transmission line is expected to be ready by then.

Nepal has also sought Indian help for the construction of more high-capacity cross-border transmission lines to boost Nepal-India power trade. “India is the only market for our hydropower, so we need more crossborder transmission lines,” Shrestha reasoned.