With three key projects aimed at beefing up the power transmission capacity between India and Nepal achieving completion, an additional 40 MW of electricity transfer from India to the Nepal is expected to commence over the next couple of months.
The wrapping up of the projects by the Indian side — executed on the ground by India’s state-owned transmission major Power Grid Corporation — comes at a time when the country is working hard to set the ball rolling on its strategic initiative of putting in place a multilateral SAARC Market for Electricity (SAME) on the lines of the Nord Pool in the Scandinavian countries and the West African Power Pool.
Nepal is facing an electricity deficit of around 300 MW and currently draws around 50 MW from Bihar under a bilateral pact, along with some additional transfers from NHPC’s Tanakpur hydro station in Uttarakhand.
Extra power transfers from India would help Nepal in a big way to as the demand and supply gap could not be filled immediately with the ongoing hydro power projects.
Nepal has already, in principle, agreed to substantially ramp up power buys from India, with plans already underway to increase the power exchange volume to 200 MW by ramping up capacity between the two countries.
For the additional purchases, the Himalayan nation plans to tap the short-term electricity market window existing in India, including the two operational power exchanges, according to the decision taken at the Tenth meeting of the Indo-Nepal Power Exchange Committee held here in December 2011.
On the larger SAARC grid plan, while a transmission link with Bhutan is already in place, there are plans to augment the existing line to enable up to 5,000 MW of electricity imports into India by 2020. With Sri Lanka, plans are under way for setting up a $450-million undersea power transmission link.