A tripartite agreement is set to be signed on Thursday to sell 40 megawatts of electricity produced in Nepal to Bangladesh. Under this agreement, Nepal will receive 6.40 US cents per unit of electricity. The agreement will be made between India’s NTPC Electricity Trading Corporation (NVVN), Bangladesh’s Bangladesh Power Development Board (BPDB), and Nepal Electricity Authority (NEA).

Earlier, it was said that an agreement to buy and sell 40 megawatts of electricity would be signed on July 28. However, political developments in Bangladesh delayed the agreement. “Now, a meeting between the Energy Secretary and Joint Secretary will be held on Tuesday and Wednesday, and it has been decided to sign the electricity sale agreement on Thursday,” said Chiranjeevi Chatout, spokesperson for the Ministry of Energy, Water Resources, and Irrigation. “We have been informed that the Energy Minister of Bangladesh will be coming for the agreement.”

According to spokesperson Chatout, the meeting of the Energy Secretary-level Joint Steering Committee (JSC) and the Joint Working Group (JWG), which includes Joint Secretaries, will be held in Kathmandu on Tuesday and Wednesday. Earlier, it was said that the meeting would take place in Pokhara.

The authority has an agreement to sell electricity to Bangladesh for five months during the monsoon season, from June 15 to November 15 each year. According to this, 144,000 megawatt-hours of electricity will be exported over the five months. At a rate of 6.40 US cents per unit, the authority has stated that the revenue will be 9.216 million US dollars during this period.

The electricity will reach Bangladesh via India’s transmission line from Muzaffarpur, through the 400 kV Behrampur (India)–Bheramara (Bangladesh) transmission line. The authority is set to export electricity generated by the 25 MW Trishuli hydropower project, which is owned by the authority and built with Indian grants, and the 22 MW Chilime hydropower project, constructed by a subsidiary company. Both projects have already received approval for electricity export to India.

The Economic Affairs Committee of Bangladesh’s Cabinet gave its in-principle approval on December 6, 2023, to the proposal for importing 40 megawatts of electricity from Nepal. Following this, BPDB invited bids on January 1 2024, for the purchase of 40 megawatts of electricity produced in Nepal, under a tripartite agreement between Bangladesh, India, and Nepal, for a period of five years. The Nepal Electricity Authority submitted the bid documents, including the proposed electricity rate, in the second week of Janaury.

After that, a meeting was held between the team from the Nepal Electricity Authority and the bid evaluation committee under BPDB on February 22 in Dhaka. Nepal had proposed a price of 6.70 US cents per unit of electricity. However, no agreement was reached on the price during the meeting as Nepal took a firm stance that it would not sell at a lower price than what it sold to India. Later, during a bilateral discussion at the SAARC Energy Secretary-level meeting organized by the World Bank in Singapore, Bangladesh agreed to purchase the electricity at a slightly reduced price of 6.40 US cents per unit.

Although an agreement was reached on the price, it was only on June 11 that Bangladesh’s Cabinet Committee on Public Procurement (CCGP) approved the price for the electricity to be imported from Nepal. After evaluating the submitted bid documents and informing the relevant authorities, BPDB notified the Nepal Electricity Authority on July 7 of its intention to accept the bid.

The authority also provided written notification to BPDB confirming the acceptance of the bid. Shortly thereafter, BPDB sent the draft power sale agreement to the authority. Upon receiving the draft, the authority fixed the contract date and sent a letter with an invitation to BPDB on July 10.

Before the agreement was finalized, widespread protests against the government by students erupted in Bangladesh, leading to the resignation of then-Prime Minister Sheikh Hasina, who left the country. This created uncertainty about the electricity purchase and sale agreement. However, the head of Bangladesh’s interim government, Mohammad Yunus, indicated that the process of importing electricity from Nepal would continue, paving the way for the agreement.

Source: Kantipur