NEA earns NPR 4.19 billion from electricity exports in July

KATHMANDU: In the first month of the current fiscal year 2081/82 (2024/25), Nepal earned NPR 4.19 billion from electricity exports to India.

According to the Nepal Electricity Authority (NEA), surplus electricity generated during the monsoon season was exported to India, resulting in a revenue of NPR 4.19 billion (NPR 419.39 million daily) in July alone. The electricity trade with India is conducted in Indian Rupees (INR), and the sales in July brought in INR 2.62 billion.

The average export rate for electricity in July was NPR 8.51 per unit.

NEA’s Executive Director, Kulman Ghising, highlighted the significant progress in Nepal’s power sector. Eight years ago, the country faced daily load-shedding of 8-9 hours during the monsoon and up to 18 hours during the dry season. Today, however, Nepal exports over 700 MW of surplus electricity daily during the monsoon months.

Ghising noted that while occasional power outages may occur due to natural or technical reasons, there is no longer a need for load-shedding due to insufficient supply. “Our primary priority is to increase domestic electricity consumption,” Ghising said. “We are implementing transmission and distribution system improvements and expansions as a campaign, and the surplus electricity will be exported to neighboring countries India and Bangladesh.”

He emphasized that exporting electricity to India during the monsoon season has not only generated significant foreign currency but also positively contributed to reducing Nepal’s trade deficit with India.

“Although we may still need to import electricity during some winter months, the volume of imports is gradually decreasing,” Ghising said. “Since last fiscal year, we have become a net exporter of electricity, having sold surplus electricity to the Indian market.”

The NEA currently exports surplus electricity to India through the Indian Energy Exchange (IEX) in the Day-Ahead and Real-Time Markets at competitive rates and under a bilateral medium-term electricity sales agreement with NTPC Vidyut Vyapar Nigam (NVVN), an Indian company. NVVN, in turn, sells this electricity to the state of Haryana.

So far, the NEA has received approval to export 941 MW of electricity to the Indian market from 28 hydropower projects under competitive market and medium-term agreements. Recently, Nepal received approval to export an additional 251 MW of electricity to Bihar and Haryana under bilateral agreements. Of this, 125.89 MW will be sold to Haryana from two hydropower projects through NVVN. Currently, 109.61 MW of electricity from two projects is being sold to Haryana.

An additional 125 MW of electricity from 10 hydropower projects will be exported to Bihar under a medium-term agreement through PTC India Ltd. This marks the first time Nepal will export electricity to Bihar, with exports set to begin soon after completing the necessary technical processes.

Currently, 580.89 MW of electricity generated from 14 projects is being sold on the IEX at competitive rates. As the recently approved quantities of electricity have yet to begin export, Nepal is currently exporting 690.50 MW of electricity daily to IEX and Haryana. Nepal can export an additional 10 percent of the approved quantity, leading to the daily export of over 700 MW.

Last fiscal year, Nepal imported electricity worth NPR 16.93 billion from India, while exporting electricity worth NPR 17.06 billion. This marked a significant milestone as Nepal transitioned from being a net importer to a net exporter of electricity, with exports exceeding imports by NPR 130 million.