Nepal’s import of electricity is likely to surge in upcoming winter due to the delay in reconstruction of the hydropower plants which were damaged by floods and landslides triggered by incessant rainfall on September 27 and 28.

According to the Nepal Electricity Authority (NEA), the 456 MW Upper Tamakoshi Hydropower Project, one of the major electricity production plants, has failed to resume its operation since the project was hit by the natural disaster one and a half months ago. While production from the project has completely stopped, it made the state-owned power utility face a loss of Rs 1.42 billion so far.

Citing surplus electricity production, the NEA had been looking forward to reducing electricity imports from this year’s winter. Kulman Ghising, managing director of the NEA, said the situation is likely to revert due to damages sustained by the hydropower plants. “The country might need to increase electricity imports if the projects including Upper Tamakoshi are not brought into operation by winter.

The Upper Tamakoshi Hydropower Project is reported to complete its maintenance in the next seven months.

Almost every year, Nepal imports around 600 MW of electricity in winter due to low energy production and high demand during the period. As most of the electricity projects are run-off-river types, the production drops to less than half during the dry season.

The damages to the power houses also seem to adversely affect the profits of the power utility in the current fiscal year. In the last fiscal year, the NEA earned profit of Rs 13.31 billion, a major section of which was contributed by electricity export to India.

As the country’s electricity production has reached to 3,200 MW and peak demand has been registered as high as 2,600 MW, the NEA has been selling surplus electricity to India.

In FY 2022/23, the country spent Rs 19.44 billion to import electricity, while earning Rs 10.45 billion by exporting electricity to its southern neighbor. In over four months between June 2 and October 11, 2024, the NEA earned Rs 7.93 billion by selling 1.3 billion units of electricity to India.

In the last fiscal year, Nepal became the net exporter of electricity for the first time. The NEA exported electricity worth Rs 16.93 billion to India while it spent Rs 16.81 billion to import electricity from the southern neighbor. In this regard, the NEA gained a net profit of over Rs 120 million from the transaction.

Nepal sells its electricity to India at the rate of Rs 8 per unit on an average. However, the country has to spend up to Rs 18 per unit to purchase electricity from the southern neighbor.