Electricity deal between Nepal and Bangladesh stalls over rate disagreement, albeit talks progress positively on power trade

Published On: February 25, 2024 08:00 AM NPT By: Republica | @RepublicaNepal

KATHMANDU, Feb 25: The electricity purchase and sale agreement between the Nepal Electricity Authority (NEA) and the Bangladesh Power Development Board (BPDB) could not reach a conclusion due to a disagreement on the tariff rate.

The NEA has proposed to provide electricity produced in Nepal at the tariff between Rs 8.96 per unit and Rs 9.28 per unit. The state-owned power utility, in response to Bangladesh’s proposal to set tariffs of electricity for trading last month, came up with the rates from its part. The tariff rate was supposed to be finalized through a face-to-face meeting.

Despite the discord, it is reported that the bilateral talks have progressed in a positive line for cross-border electricity trade. According to Kulman Ghisingh, managing director of the NEA, an agreement was reached between the two countries to export electricity to Bangladesh from the coming rainy season.

The Nepali delegation led by Ghising and the bid evaluation committee under BPDB held a meeting in Dhaka, Bangladesh on Thursday. Ghising said that every point to be included in the electricity purchase and sale agreement was discussed in detail and it was agreed to finalize it soon.

"BPDB submitted a bid for the electricity trade as per the regulation upon our request. We discussed in detail about the proposals submitted and the points to be included in the contract," Ghising said.

"They also have to get approval from the higher authorities. They have agreed to purchase electricity from Nepal from the next rainy season after completing the approval process as quickly as possible."

During Prime Minister Pushpa Kamal Dahal’s visit to India in May-June last year, the Indian side had promised to facilitate the export of electricity from Nepal to Bangladesh. In this regard, the NEA had sent a proposal to Bangladesh to export up to 40 MW of electricity during the six months of the rainy season from mid-June to mid-November every year. The electricity purchase and sale agreement is supposed to last for five years.

Nepal will export electricity from the Dhalkebar-Muzaffarpur 400 kV international transmission line which is connected to Baharampur-Bheramara transmission line between India and Bangladesh.