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Home Asia Nepal

Nepal and Bangladesh Forge 25-Year Power Sale Agreement

FrontWires by FrontWires
July 9, 2023
Reading Time: 3 mins read
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Nepal and Bangladesh Forge 25-Year Power Sale Agreement

In an important development for the energy sector, officials from Kathmandu and Dhaka have reached a landmark agreement to sign a long-term deal for the export of 40MW of electricity from Nepal to Bangladesh. This move marks a significant step towards strengthening bilateral relations and fostering regional cooperation in the power trade.

Although the exact tariff for the electricity export is yet to be determined, the duration of the agreement has been finalized, ensuring a stable and long-term market for Nepal’s electricity in Bangladesh. This progressive step aligns with Nepal’s proposal to the Bangladeshi side, reflecting their shared commitment to sustainable energy solutions.

The agreement between Nepal and Bangladesh bears similarities to the long-term inter-governmental power trade agreement established with India during Prime Minister Pushpa Kamal Dahal’s recent visit to the neighboring country. The collaboration between these three nations will contribute to the development of a robust and interconnected regional power grid.

Prabal Adhikari, the power trade director at Nepal Electricity Authority, revealed that initially, Bangladesh expressed a preference for a five-year agreement with the option of renewal due to uncertainties in the power sector. However, after fruitful negotiations, Bangladesh has agreed to a 25-year deal, pending the final signing. Kul Man Ghising, the managing director of NEA, stated that while the tariff is still under discussion, both parties have reached a consensus on all other aspects of the agreement.

To formalize the understanding, Nepal, India, and Bangladesh will sign a tripartite agreement that facilitates power sale from Nepal to Bangladesh through the Indian territory. The technical and commercial aspects of the agreement have been thoroughly discussed and resolved, prioritizing issues beyond tariff considerations.

Regarding tariff, the NEA has expressed its openness to negotiation, intending to offer a favorable rate as a gesture of goodwill in this government-to-government deal. The existing electricity price in Bangladesh will serve as a reference, but the final rate is yet to be determined.

Furthermore, the transmission charge and service fee will be handled differently. Bangladesh will make direct payments for transmission charges to NTPC Vidyut Vyapar Nigam Limited (NVVN), an Indian power trading company. The transmission charge will adhere to India’s open access rules, as specified in the draft of the proposed power sale agreement. Depending on the technical conditions of the transmission infrastructure and load, Bangladesh may incur a charge of 40-55 paisa per unit.

In addition to the transmission charge, Bangladeshi entities may also be required to pay service fees to compensate the Indian company for obtaining regulatory approval. The service charge is estimated to range from 4 to 7 paisa per unit. The collection of these fees will be the responsibility of NVVN, India’s nodal agency for cross-border power trade.

The tripartite agreement, involving Nepal, India, and Bangladesh, will involve the participation of NVVN, thereby facilitating the export of 40MW power to Bangladesh. Once an understanding on tariff is reached between Nepal and Bangladesh, the tripartite agreement can be formalized, paving the way for seamless power transactions.

The positive developments in power trade extend beyond bilateral relations, as India has also expressed its willingness to facilitate electricity trade between Nepal and Bangladesh. During Prime Minister Dahal’s visit to India, the Indian government reaffirmed its commitment to support the first trilateral power transaction from Nepal to Bangladesh through the Indian grid, allowing for the export of up to 40MW of power. India’s endorsement strengthens the region’s energy cooperation and underscores the shared vision for a connected and sustainable power network.

Furthermore, Nepal and Bangladesh have jointly requested India to grant permission for power trade through the high-voltage Baharampur-Bheramara cross-border transmission link. This step highlights the collaborative efforts of the three nations to optimize power utilization and promote economic growth through efficient energy sharing.

The Nepal Electricity Authority has made an official request to the Indian authorities, seeking permission to sell the power generated from the 52.4MW Likhu-4 project to Bangladesh. This endeavor showcases Nepal’s commitment to utilizing its hydropower potential and meeting the energy demands of its neighbors, fostering regional integration and mutual prosperity.

The power sale agreement between Nepal and Bangladesh signifies a significant milestone in their shared journey towards energy collaboration. With long-term stability and opportunities for future growth, this agreement paves the way for enhanced regional cooperation and a sustainable energy landscape in South Asia.

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In an important development for the energy sector, officials from Kathmandu and Dhaka have reached a landmark agreement to sign a long-term deal for the export of 40MW of electricity from Nepal to Bangladesh. This move marks a significant step towards strengthening bilateral relations and fostering regional cooperation in the power trade.

Although the exact tariff for the electricity export is yet to be determined, the duration of the agreement has been finalized, ensuring a stable and long-term market for Nepal’s electricity in Bangladesh. This progressive step aligns with Nepal’s proposal to the Bangladeshi side, reflecting their shared commitment to sustainable energy solutions.

The agreement between Nepal and Bangladesh bears similarities to the long-term inter-governmental power trade agreement established with India during Prime Minister Pushpa Kamal Dahal’s recent visit to the neighboring country. The collaboration between these three nations will contribute to the development of a robust and interconnected regional power grid.

Prabal Adhikari, the power trade director at Nepal Electricity Authority, revealed that initially, Bangladesh expressed a preference for a five-year agreement with the option of renewal due to uncertainties in the power sector. However, after fruitful negotiations, Bangladesh has agreed to a 25-year deal, pending the final signing. Kul Man Ghising, the managing director of NEA, stated that while the tariff is still under discussion, both parties have reached a consensus on all other aspects of the agreement.

To formalize the understanding, Nepal, India, and Bangladesh will sign a tripartite agreement that facilitates power sale from Nepal to Bangladesh through the Indian territory. The technical and commercial aspects of the agreement have been thoroughly discussed and resolved, prioritizing issues beyond tariff considerations.

Regarding tariff, the NEA has expressed its openness to negotiation, intending to offer a favorable rate as a gesture of goodwill in this government-to-government deal. The existing electricity price in Bangladesh will serve as a reference, but the final rate is yet to be determined.

Furthermore, the transmission charge and service fee will be handled differently. Bangladesh will make direct payments for transmission charges to NTPC Vidyut Vyapar Nigam Limited (NVVN), an Indian power trading company. The transmission charge will adhere to India’s open access rules, as specified in the draft of the proposed power sale agreement. Depending on the technical conditions of the transmission infrastructure and load, Bangladesh may incur a charge of 40-55 paisa per unit.

In addition to the transmission charge, Bangladeshi entities may also be required to pay service fees to compensate the Indian company for obtaining regulatory approval. The service charge is estimated to range from 4 to 7 paisa per unit. The collection of these fees will be the responsibility of NVVN, India’s nodal agency for cross-border power trade.

The tripartite agreement, involving Nepal, India, and Bangladesh, will involve the participation of NVVN, thereby facilitating the export of 40MW power to Bangladesh. Once an understanding on tariff is reached between Nepal and Bangladesh, the tripartite agreement can be formalized, paving the way for seamless power transactions.

The positive developments in power trade extend beyond bilateral relations, as India has also expressed its willingness to facilitate electricity trade between Nepal and Bangladesh. During Prime Minister Dahal’s visit to India, the Indian government reaffirmed its commitment to support the first trilateral power transaction from Nepal to Bangladesh through the Indian grid, allowing for the export of up to 40MW of power. India’s endorsement strengthens the region’s energy cooperation and underscores the shared vision for a connected and sustainable power network.

Furthermore, Nepal and Bangladesh have jointly requested India to grant permission for power trade through the high-voltage Baharampur-Bheramara cross-border transmission link. This step highlights the collaborative efforts of the three nations to optimize power utilization and promote economic growth through efficient energy sharing.

The Nepal Electricity Authority has made an official request to the Indian authorities, seeking permission to sell the power generated from the 52.4MW Likhu-4 project to Bangladesh. This endeavor showcases Nepal’s commitment to utilizing its hydropower potential and meeting the energy demands of its neighbors, fostering regional integration and mutual prosperity.

The power sale agreement between Nepal and Bangladesh signifies a significant milestone in their shared journey towards energy collaboration. With long-term stability and opportunities for future growth, this agreement paves the way for enhanced regional cooperation and a sustainable energy landscape in South Asia.

Table of Contents

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RELATED POSTS

Nepal’s Path to Becoming a Clean Energy Powerhouse in South Asia

Actress Suraksha Pant signed for the film ‘Karsang’

Ticket Sanjal Revolutionizes Event Ticketing

In an important development for the energy sector, officials from Kathmandu and Dhaka have reached a landmark agreement to sign a long-term deal for the export of 40MW of electricity from Nepal to Bangladesh. This move marks a significant step towards strengthening bilateral relations and fostering regional cooperation in the power trade.

Although the exact tariff for the electricity export is yet to be determined, the duration of the agreement has been finalized, ensuring a stable and long-term market for Nepal’s electricity in Bangladesh. This progressive step aligns with Nepal’s proposal to the Bangladeshi side, reflecting their shared commitment to sustainable energy solutions.

The agreement between Nepal and Bangladesh bears similarities to the long-term inter-governmental power trade agreement established with India during Prime Minister Pushpa Kamal Dahal’s recent visit to the neighboring country. The collaboration between these three nations will contribute to the development of a robust and interconnected regional power grid.

Prabal Adhikari, the power trade director at Nepal Electricity Authority, revealed that initially, Bangladesh expressed a preference for a five-year agreement with the option of renewal due to uncertainties in the power sector. However, after fruitful negotiations, Bangladesh has agreed to a 25-year deal, pending the final signing. Kul Man Ghising, the managing director of NEA, stated that while the tariff is still under discussion, both parties have reached a consensus on all other aspects of the agreement.

To formalize the understanding, Nepal, India, and Bangladesh will sign a tripartite agreement that facilitates power sale from Nepal to Bangladesh through the Indian territory. The technical and commercial aspects of the agreement have been thoroughly discussed and resolved, prioritizing issues beyond tariff considerations.

Regarding tariff, the NEA has expressed its openness to negotiation, intending to offer a favorable rate as a gesture of goodwill in this government-to-government deal. The existing electricity price in Bangladesh will serve as a reference, but the final rate is yet to be determined.

Furthermore, the transmission charge and service fee will be handled differently. Bangladesh will make direct payments for transmission charges to NTPC Vidyut Vyapar Nigam Limited (NVVN), an Indian power trading company. The transmission charge will adhere to India’s open access rules, as specified in the draft of the proposed power sale agreement. Depending on the technical conditions of the transmission infrastructure and load, Bangladesh may incur a charge of 40-55 paisa per unit.

In addition to the transmission charge, Bangladeshi entities may also be required to pay service fees to compensate the Indian company for obtaining regulatory approval. The service charge is estimated to range from 4 to 7 paisa per unit. The collection of these fees will be the responsibility of NVVN, India’s nodal agency for cross-border power trade.

The tripartite agreement, involving Nepal, India, and Bangladesh, will involve the participation of NVVN, thereby facilitating the export of 40MW power to Bangladesh. Once an understanding on tariff is reached between Nepal and Bangladesh, the tripartite agreement can be formalized, paving the way for seamless power transactions.

The positive developments in power trade extend beyond bilateral relations, as India has also expressed its willingness to facilitate electricity trade between Nepal and Bangladesh. During Prime Minister Dahal’s visit to India, the Indian government reaffirmed its commitment to support the first trilateral power transaction from Nepal to Bangladesh through the Indian grid, allowing for the export of up to 40MW of power. India’s endorsement strengthens the region’s energy cooperation and underscores the shared vision for a connected and sustainable power network.

Furthermore, Nepal and Bangladesh have jointly requested India to grant permission for power trade through the high-voltage Baharampur-Bheramara cross-border transmission link. This step highlights the collaborative efforts of the three nations to optimize power utilization and promote economic growth through efficient energy sharing.

The Nepal Electricity Authority has made an official request to the Indian authorities, seeking permission to sell the power generated from the 52.4MW Likhu-4 project to Bangladesh. This endeavor showcases Nepal’s commitment to utilizing its hydropower potential and meeting the energy demands of its neighbors, fostering regional integration and mutual prosperity.

The power sale agreement between Nepal and Bangladesh signifies a significant milestone in their shared journey towards energy collaboration. With long-term stability and opportunities for future growth, this agreement paves the way for enhanced regional cooperation and a sustainable energy landscape in South Asia.

Buy JNews
ADVERTISEMENT

In an important development for the energy sector, officials from Kathmandu and Dhaka have reached a landmark agreement to sign a long-term deal for the export of 40MW of electricity from Nepal to Bangladesh. This move marks a significant step towards strengthening bilateral relations and fostering regional cooperation in the power trade.

Although the exact tariff for the electricity export is yet to be determined, the duration of the agreement has been finalized, ensuring a stable and long-term market for Nepal’s electricity in Bangladesh. This progressive step aligns with Nepal’s proposal to the Bangladeshi side, reflecting their shared commitment to sustainable energy solutions.

The agreement between Nepal and Bangladesh bears similarities to the long-term inter-governmental power trade agreement established with India during Prime Minister Pushpa Kamal Dahal’s recent visit to the neighboring country. The collaboration between these three nations will contribute to the development of a robust and interconnected regional power grid.

Prabal Adhikari, the power trade director at Nepal Electricity Authority, revealed that initially, Bangladesh expressed a preference for a five-year agreement with the option of renewal due to uncertainties in the power sector. However, after fruitful negotiations, Bangladesh has agreed to a 25-year deal, pending the final signing. Kul Man Ghising, the managing director of NEA, stated that while the tariff is still under discussion, both parties have reached a consensus on all other aspects of the agreement.

To formalize the understanding, Nepal, India, and Bangladesh will sign a tripartite agreement that facilitates power sale from Nepal to Bangladesh through the Indian territory. The technical and commercial aspects of the agreement have been thoroughly discussed and resolved, prioritizing issues beyond tariff considerations.

Regarding tariff, the NEA has expressed its openness to negotiation, intending to offer a favorable rate as a gesture of goodwill in this government-to-government deal. The existing electricity price in Bangladesh will serve as a reference, but the final rate is yet to be determined.

Furthermore, the transmission charge and service fee will be handled differently. Bangladesh will make direct payments for transmission charges to NTPC Vidyut Vyapar Nigam Limited (NVVN), an Indian power trading company. The transmission charge will adhere to India’s open access rules, as specified in the draft of the proposed power sale agreement. Depending on the technical conditions of the transmission infrastructure and load, Bangladesh may incur a charge of 40-55 paisa per unit.

In addition to the transmission charge, Bangladeshi entities may also be required to pay service fees to compensate the Indian company for obtaining regulatory approval. The service charge is estimated to range from 4 to 7 paisa per unit. The collection of these fees will be the responsibility of NVVN, India’s nodal agency for cross-border power trade.

The tripartite agreement, involving Nepal, India, and Bangladesh, will involve the participation of NVVN, thereby facilitating the export of 40MW power to Bangladesh. Once an understanding on tariff is reached between Nepal and Bangladesh, the tripartite agreement can be formalized, paving the way for seamless power transactions.

The positive developments in power trade extend beyond bilateral relations, as India has also expressed its willingness to facilitate electricity trade between Nepal and Bangladesh. During Prime Minister Dahal’s visit to India, the Indian government reaffirmed its commitment to support the first trilateral power transaction from Nepal to Bangladesh through the Indian grid, allowing for the export of up to 40MW of power. India’s endorsement strengthens the region’s energy cooperation and underscores the shared vision for a connected and sustainable power network.

Furthermore, Nepal and Bangladesh have jointly requested India to grant permission for power trade through the high-voltage Baharampur-Bheramara cross-border transmission link. This step highlights the collaborative efforts of the three nations to optimize power utilization and promote economic growth through efficient energy sharing.

The Nepal Electricity Authority has made an official request to the Indian authorities, seeking permission to sell the power generated from the 52.4MW Likhu-4 project to Bangladesh. This endeavor showcases Nepal’s commitment to utilizing its hydropower potential and meeting the energy demands of its neighbors, fostering regional integration and mutual prosperity.

The power sale agreement between Nepal and Bangladesh signifies a significant milestone in their shared journey towards energy collaboration. With long-term stability and opportunities for future growth, this agreement paves the way for enhanced regional cooperation and a sustainable energy landscape in South Asia.

Tags: BangladeshElectricity exportnepalpower sale agreement
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