India has committed that all the reinforcement of the existing key points of power exchange will be completed within six months and power supply to 100 MW would be provided to Nepal as the work progresses.[break]
After the signing, the leader of Indian delegation, Mr Rabindra, who is Central Electricity Authority member Power System, said, “We are ready to support Nepal,” adding, “Nepal is rich in hydro-resources and we would work for mutual benefit.”
The Nepali side too has expressed “satisfaction” after the two-day talks, which were considered vital to meet Nepal´s energy crisis.
“Nepal will face up to 18 hours load-shedding this dry season,” Sher Singh Bhatt, head of Power Trade Department of Nepal Electricity Authority, said after the meeting concluded, adding, “India is willing to complete all remaining maintenance work which will enable us to import power at the earliest to lessen the power cuts.”
By working out short-term, mid-term and long-term goals, Nepal intends to import 100 MW in three months and another 150 MW in a year. This is subject to completion of the remaining enforcement works. In addition, the Transmission Service Agreement signed on Friday will enable import of 150 MW for 25 years from the proposed Dhalkebar-Muzaffarpur 400 kV line.
The PEC has said, like earlier, that the existing interconnection capacity is inadequate and the solution lies in the development of several high capacity cross-border interconnections. It has been agreed that the tariff will be based on commercial principles.
The meeting was attended by all stakeholders from India who interacted with the 11-member delegation from Nepal. Currently, the Power Trading Corporation of India is the only nodal agency for power trade between India and Nepal.
Power exchange scenario The power exchange mechanism between India and Nepal started with the signing of Kosher treaty in 1954 and in 1971 Indo-Nepal Power exchange commenced with 5 MW import in the initial years. At present Nepal receives power in three modes. First from Kataiya Power House under Kosher Treaty (10 MW), second from Border Town Exchange Program (50 MW) and third is based on radial system at different points.
During the sixth PEC meeting in 2001, the two countries agreed in principle that India would supply up to 150 MW at commercial rates. Nepal sough an additional 200 MW during Prime Minister Baburam Bhattarai´s visit to India in October.
Nepal too supplies power to Bihar state of India in the areas of Chandragadhi-Kishangunj, Biratnagar-Jogbani, Birganj-Raxaul, and Bardhghat-Ramnagar.
Institutional mechanism
The Power Exchange Committee (PEC) was constituted in 1992 with the view to overseeing the exchange and other issues between India and Nepal and is supposed to meet once a year by rotation in India and Nepal. The other mechanism is the Joint Committee on Water Resources (JCWR) constituted as per the agreement of August 3, 2000, during the visit of then Prime Minister GP Koirala.
JCWR Is headed by secretaries of ministries of both the countries and is supposed to meet every six months. The last JCWR was held in New Delhi in November.
Projects for power trade
Nepal and India have engaged only in power exchange and not in power trade. To realize the power trading in real terms, the Dhalkebar-Mujaffarpur line, which is the first India-Nepal interconnection, is being developed under PPP (Purchasing Power Parity) model.
At the same time, to enable power to and from this cross-border transmission line, internal strengthening of the line is being taken up by Nepal government under financing from the World Bank, for which the Hetauda-Duhabi 300 km long 400 kV will be constructed.
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