Bangladesh, Nepal write to India for trilateral power trade deal

Amid the fuel shortage-driven frequent power outages across the country, Bangladesh has approached its neighbouring nation India to ink a trilateral agreement so that it can import comparatively cheaper hydroelectricity from Nepal. 

If the agreement is inked, Bangladesh will be able to receive 50MW of hydroelectricity from Nepal initially, said officials of the Power Division and the Bangladesh Power Development Board (BPDB).

Md Nazmul Haque, member (company affairs) of the BPDB confirmed the matter to The Business Standard.  

Meanwhile, as a joint initiative, Nepal also has sent a separate letter to the Indian authorities on the same issue, reports The Kathmandu Post citing Energy Secretary Sushil Chandra Tiwari.  

"Nepal has sent a notification to the Indian side about the decision between Nepal and Bangladesh," The Kathmandu Post quoted Sushil Chandra as saying.   

It also quoted that the issue would be discussed during the next bilateral meeting between Nepal and India.

The next meeting of the India and Nepal Joint Working Group and the Joint Steering Committee on energy is scheduled for later this year.

At present, the average generation cost of per unit electricity is Tk10 in Bangladesh, whereas the production cost of each unit of diesel-based power is Tk37 and that of furnace oil-based is Tk17. 

Because of the high purchasing cost of power, the BPDB is facing a cash crunch to pay bills to private power producers, making them incapable of importing fuel to run power plants.  

BPDB officials, however, expressed optimism that Nepalese hydropower would be a cheaper option, which would not cost more than Tk5 per unit.  

At present, the BPDB imports 1160MW of electricity from India at a rate of Tk6 per kWh.

In early August this year, Nepal and Bangladesh agreed that the Nepal Electricity Authority and the Bangladesh Power Development Board would send a request to the NTPC Vidyut Vyapar Nigam Ltd (NVVN) of India for a trilateral power trade agreement to enable the export of 40 to 50 megawatts of power generated in Nepal to Bangladesh.

As Nepal and Bangladesh do not share borders and India lies between the two countries, India's cooperation will be crucial to enable the trading of electricity between the two countries. 

Here, NTPC Vidyut Vyapar Nigam is a nodal agency of the Indian government for cross-border power trade with neighbouring countries.

Bangladesh has also decided to buy 500MW of electricity from the 900MW Upper Karnali Hydropower Project to be developed by India's GMR Group, which has set up GMR Upper Karnali Hydropower Limited to develop the plant in Nepal.

Besides, Bangladesh has also agreed to develop the 383MW Sunkoshi-3 Hydropower Project in a joint venture between the two countries. 

There is also a grand vision shared by Nepal and India in which Bangladesh is also a major component in a sub-regional power market.

The countries plan to trade power using the Baharampur-Bheramara cross-border transmission line, which links India and Bangladesh.

The transmission line inaugurated in 2013 facilitates the exchange of 500MW of electricity.

Though Nepal and Bangladesh have identified the Bheramara High Voltage Direct Current as a route to deliver limited power to Bangladesh from Nepal, it will not be a long-term solution for exporting more power.

Understanding the necessity, Bangladesh raised the issue at the highest level.

Prime Minister Sheikh Hasina, during her state visit to India in early September, formally requested India for passage to import electricity from Nepal.