The assistance comprises of $84 million in loans and remaining in grant, according to a press statement. Once implemented, the Nepal-India Electricity Transmission and Trade Project (NIETTP) will enable Nepal acquire at least 100 MW of additional electricity, thereby helping it minimize power blackouts. [break]
The country´s electricity demand during peak season is 885 MW. However, its electricity generation capacity stands at mere 698 MW. Such power deficit and costly electricity, meanwhile, is hurting economic and human development.
“For the first time, this project will help Nepal mitigate deficits through the trade in electricity,” a press statement quoted WB Country Director for Nepal, Susan Goldmark, as saying. Once Nepal meets its domestic power needs, the transmission infrastructure could also be used to export surplus hydropower and earn revenue for Nepal, she added.
In response to the worsening electricity situation, the government has declared a national energy crisis and is implementing Electricity Crisis Management Action Plan with the WB support.
The Action Plan includes development of the Dhalkebar-Muzaffarpur transmission link -- a key component of the NIETTP and the first major cross-border transmission line between India and Nepal. Upon completion, Nepal could end electricity rationing by 2015, according to projections.
As countries in South Asia typically suffer from poor consumer access to electricity, high dependence on imported petroleum products, slow development of energy sources and supply infrastructure, the WB believes that the cross-border project and cooperation can lower costs in each country, improve supply reliability, and help lower carbon emissions.
“This project will lead the way in providing the necessary physical infrastructure for initially bilateral and eventually multi-country electricity trade in the northeastern part of the South Asia Region,” the statement quoted Raghuveer Sharma, project team leader as saying.
The WB is supporting energy sector development throughout the region.
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