In a major boost to the bilateral ties between Nepal and India, New Delhi for the first time permitted Kathmandu to sell its electricity in India's power exchange market.
The Ministry of Energy, Water Resources and Irrigation said in a statement that the concerned Indian authority, Central Electricity Authority, on Monday decided to allow Nepal to sell 39 MW of electricity produced by the 24MW Trishuli Hydropower Project and the 15MW Devighat Hydropower Project in the India Energy Exchange Limited (IEX), after receiving a nod from the Ministry of Power.]
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In the first phase, 39 MW power, including 24-MW produced from Nepal Electricity Authority(NEA)- owned Trishuli hydropower and 15-MW Devighat powerhouse, has been permitted for trading in the Indian Energy Exchange.
The NEA was scheduled to start exporting the power through Dhalkebar-Mujaffapur 400-KV inter-country transmission line from midnight Tuesday. This transmission line has been used merely to import power.
"Following the Indian approval for Nepal to export its electricity, power trade between the two countries has entered a new phase," the Ministry of Energy, Water Resources and Irrigation said.
Nepal had already received permission for purchasing and importing power from the Indian Energy Exchange. With this, the NEA has been importing power through Indian Energy Exchange at a competitive rate since last April 30 as per the need. After obtaining the approval, the power trade between Nepal and India has entered a new phase.
Minister for Energy, Water Resource and Irrigation Pampha Bhusal said Nepal has become the first country in the South Asian region to enter into the agreement for power import and export from and to the Indian energy exchange market.
"We have been permitted for the trade of surplus power after continued efforts at political, diplomatic and administrative levels. This is a milestone for power trade between the two countries.
"We have also expected the approval for trade of power produced from the 456-MW Upper Tamakoshi, 69-MW Marsyangdi and 45-MW Upper Bhotekoshi power house in near future," the Minister added.
About two months ago, the power utility of NEA had proposed that electricity generated by hydropower projects, including Upper Tamakoshi, Upper Bhotekoshi, Marshyangdi, Trishuli, and Devighat, whose combined generation capacity totals 621.1MW, be auctioned in India's power exchange market.
Nepali officials said that the Indian government's permission to allow Nepal in the power exchange market has been a huge respite for the NEA, which is facing a wastage of power for more than two months.
The Himalayan nation became an energy surplus country ever since the 456MW Upper Tamakoshi Hydropower Project came into full operation in August.
According to the NEA, Nepal now has surplus power even during peak hours, usually between 7 p.m. and 8 p.m. The peak hour demand stands at 1,500MW.
The country is currently producing 2,000MW of electricity, of which 1,900MW is generated from hydropower projects.