Bangladesh is likely to start importing hydropower from Nepal by this September, officials at power, energy and mineral resources ministry said.
To this end, a 25-year power purchase agreement between the two countries is in final stage. Initially, 40 MW of hydropower will be imported from Nepal.
Although the officials concerned could not confirm the import price of electricity, they hinted that Nepal’s electricity would be much cheaper than that of India.
As there is no border between Nepal and Bangladesh, both the countries have to use Indian transmission lines. A tripartite agreement between Bangladesh, India and Nepal is expected to be signed this month to import electricity via Baharampur in Kushtia.
Director General of Power Cell Mohammad Hossain told The Business Post, "Bangladesh and Nepal are trying to ink an agreement as soon as possible. India has also agreed in this regard. So hopefully, there will be no further problems.”
Seeking anonymity, an official of Power Division said Nepal wants to sign the agreement within this month. Now it depends on Bangladesh Power Development Board because this agreement will be signed with BPDB. Nepal wants to make a deal as early as possible so that at least some electricity can be supplied this season.
He said that Nepal wants to meet its own demand first and then export electricity to Bangladesh. So, there is a possibility of getting electricity for six months a year.
As Nepal faces a shortage of electricity during the winter season, there is a little chance of getting electricity during that time, he added.
Nepal's electricity will be cheaper than coal, gas and electricity imported by Bangladesh. In that case, the cost of electricity may be Tk 4 to Tk 4.5 per unit, said the official.
Despite frequent attempts over phone, BPDB Chairman Mohammad Mahbubur Rahman could not be reached for his comments in this regard. Other officials also declined to make an official statement.
Sources in the Power Division said India’s state-owned company NTPC Vidyut Viper Nigam Limited (NVVN) may have to pay Rs 0.40 to Rs 0.55 for per unit of electricity for using transmission lines. Besides, Bangladesh will have to pay Rs 0.4 to Rs 0.7 as service charge. But the matter has not been finalized yet.
At present, Nepal's power generation capacity is 2,700 MW. If the country's under-construction hydropower project is implemented, the generation capacity will increase to 1,000 to 1,200 MW every year.
On the other hand, domestic consumption of Nepal will also increase from 300 to 400 MW per year. In addition, an agreement with India on electricity export is to be signed. In this case, Nepal will not have surplus electricity to export to Bangladesh.
Considering these issues, experts have advised the Power Division to include a 30-year uninterrupted power supply agreement (sovereign guarantee).
Apart from this, an agreement will be signed soon to import another 500 MW of electricity from India's GMR Group hydropower plant under implementation in Nepal. In addition, the government has plans to export surplus electricity from Bangladesh to Nepal in the future when the demand in the country decreases in the winter season.
According to sources, Nepal and Bangladesh have agreed to implement the 683 MW Sunkoshi-3 hydropower plant project under joint venture. An agreement in this regard may be signed by next November.
BPDB signed a PPA with GMR in 2019 to purchase 500 MW of power from the Upper Karnali Hydropower Plant in Nepal.
In a meeting with Prime Minister Sheikh Hasina on October 25 last year, Ambassador of Nepal Ghanshyam Bhandari said that Nepal will supply 40-50 MW of electricity to Bangladesh at the moment. However, power supply will increase after the completion of a mega project in Nepal’s power sector.