“Nepal is one of the richest nations in hydro power potentiality estimated at 83,000 MW in total. It is no wonder that water resources have been considered as white gold for Nepal. But, unfortunately, it has never been properly harnessed or exploited for well being of the people or the development of the nation”.

#######################################################################

Dr. Rambhakta PB Thakur
President
Association of Former Career Ambassadors of Nepal (AFCAN)
And
Former Ambassador to Egypt
Kathmandu, Nepal

Nepal is one of the richest nations in hydro power potentiality estimated at 83,000 MW in total. It is no wonder that water resources have been considered as white gold for Nepal. But, unfortunately, it has never been properly harnessed or exploited for well being of the people or the development of the nation. As in Greece, long back 2,000 years ago, water resources had been traditionally used as a kinetic energy. Hydro means water in Greek. We had also the same type of hydro power used in the traditional ‘Ghatta’ (wooden wheel) in ancient Nepal.

Now, we are talking to convert the kinetic energy into electro-mechanical energy. In the history, it was only in 1882 that the first hydro plant was built in Wisconsin, USA. Nepal remained not very far in adopting the modern technology in those days. In Nepal, the first hydro power plant (50 KW) was established at Pharping in 1911, just 29 years after the world’s first plant was installed, during the Rana Prime Minister Chandra Shumsher’s regime. We were the second in Asia in this transformation of energy. In those days, China took to this technology after us.

In the world today, the highest producers of hydro power are Canada, US, Brazil, China, Russia and Norway. Among the various countries, Canada ranks first in the production of hydropower as it has abundant water resources like Nepal.

After the establishment of the first hydro power in Pharping in 1911, the second hydropower plant (840 KW) was established in Sundarijal in 1936 and many more small scale power plants were installed here and there without any serious study or planning. Nepal has not been able to tap even one percent of its potential electricity capacity and as of 2019 about 30%of Nepal’s population is still deprived of grid-connected electricity. Right from the First Five Year Plan (1956-61) till today, many projects have been progressively launched through aid, loan, FDI and mixed investments with private and public (internal and external sources).

These include Panauti plant (2400 KW), Trisuli plant (24000 KW), Kulekhani I (60 MW), Kulekhani I (32 MW), Gandak Plant (15 MW), Upper Tamakoshi (456 MW), Kali Gandaki (144 MW), Upper Tama Koshi (456 MW), Bhote Koshi (45 MW) etc. Those big projects in various phases of development include Chameli (30 MW), Budhi Gandaki (1200 MW), Upper Karnali (900 MW). Likewise, currently there are 124 projects in operation and another 244 projects have obtained licences for construction.

The Growing demand for clean energy in India provides greater possibility to sell electricity across the border. Mutual understanding and cooperation for mutual benefits is the way forward towards this goal. Last fiscal year, Nepal was able to sell near about Rs. 4 billions worth of electricity. In the coming days, manifold rise in power expert will become an important tool to reduce the escalating trade deficit with India. Similarly, Bangladesh is also a power deficit country. With Bangladesh, there is an agreement signed to sell 50 MW and they are ready to make Power Purchase Agreement (PPA) with Upper Karnali. Bangladesh is also ready to sign an investment modality of Sunkoshi-3. Demand for our electricity is so high in Bangladesh that Nepal may feel difficulty in fulfilling it.

China, in the north too is eager to develop the cooperation in the electricity transmission line to Tibet and to develop investment modality in this field as it is a reliable and cheaper supply to them. Climate change, global warming due to GHC emissions and increase in the numbers of disasters are the factors attracting all neighbors towards clean and green power such as hydroelectricity.

No doubt, Nepal has tremendous potentiality of hydroelectricity generation. For realizing it, billions of US dollars loans and/or foreign direct investment makes sense as there is a vast market in India and Bangladesh, even if we exclude China for the time being. However, the fluctuation in buying rate, undeserved restrictions in the Indian market unforeseen hindrances in smooth handling the deals, are still big challenges for Nepal to expedite the cross-border transmission of power. Power supply through India to Bangladesh could face even more challenges. On the other hand, failure in the payment of the cost of capital and accrued interest would fall as a big burden on Nepal (on loan-funded projects) if there is a faltering market demand from India and Bangladesh. There are many areas of policy adjustment and operational anomalies to be considered and addressed. If politics supersedes economics, for no reasons friction may arise in the utilization of generated power for unclean reasons and interests.

Increased production of power grid connectivity and cross border trade of power among the South Asian countries could help realize our common goal of prosperity and well being.

With all these ideas in mind, AFCAN organized a Talk Program on “Energy Diplomacy: With Special reference to neighboring India, Bangladesh and China”.

Er. Kulman Ghising, Managing Director of Nepal Electricity Authority made the keynote presentation in an elaborate manner, and two reputed commentators Mr. Dipak Gyawali, former Minister of Water Resources and Mr. Surya Nath Upadhyay, former Secretary of Water Resource Ministry made comments on the presentation.

Both the commentators are experts on water resources and have contributed their thoughts through many journals, and talk programs. They have much more practical knowledge on the subject such as demand, supply, market, existing challenges, political interferences, dominance and common accessibility for smooth trade-bilateral and regional. Market and trade rules must not become a victim of the political courses.

The golden rule of trade should be respected by all parties. Let us share the views of the experts on available opportunity for boom in water resources utilization for common and equitable benefit and minimization of potential risks and adversities.

There is a scholarly discussion on the energy diplomacy of Nepal with reference to India, Bangladesh and China in the attached paper.

In the midst of growing threats of climate change and pollution, the importance of green energy such as hydro power has been increasing by leaps and bound to fuel rapid economic development of the world, and at the same time, reducing the catastrophic consequences of climate change.

Against this odd, we can realize our own regional potential for effective utilization of higher proportion of green energy through deft handling of South Asian energy diplomacy and avoiding any conflicts or hurdles that may arise in power generation, transmission and ultimate consumption.

Text courtesy: The AFCAN Review, Vol. 3, 2022.
# Thanks distinguished author Dr. Thakur and the entire AFCAN editorial team: Ed. Upadhyaya. N. P.
# Our own email address: editor.telegraphnepal@gmail.com