Nepal’s power sector has recorded notable progress over the past six months, with nearly 500 megawatts of electricity added to the national grid. According to the Ministry of Energy, Water Resources and Irrigation, 495 MW was connected to the transmission system by mid-January, raising the country’s total installed capacity to 4,086 MW. The growth reflects the gradual completion of several hydropower projects and improved coordination in grid integration.

Official records show that Nepal’s installed capacity stood at 3,591 MW by mid-July last year. This figure rose to 4,046 MW by mid-October and continued to expand in the following months. The steady increase indicates stronger momentum in project completion and commissioning. However, electricity generated from projects under testing and from some alternative energy sources has not been included in the official statistics, suggesting that actual potential capacity could be even higher.

Despite the rise in generation capacity, Nepal continues to rely on electricity imports during the winter season. With declining river flow in colder months, hydropower production drops sharply, creating a supply gap. As a result, the country has been importing power from India to meet domestic demand. This highlights Nepal’s continued dependence on run-of-river hydropower projects, which are highly sensitive to seasonal changes.

The contribution of alternative energy sources remains limited but gradually increasing. The ministry reports that solar power currently contributes 62.7 MW, while small and micro-hydropower projects generate 41.16 MW. Although these sources help diversify the energy mix, their share in total production is still relatively small. Energy experts believe that expanding solar and storage-based projects could reduce seasonal vulnerability in the long term.

Alongside generation, Nepal has also expanded its transmission and distribution infrastructure. The total length of transmission lines above 66 kV has reached 7,247 circuit kilometers, supported by substations with a combined capacity of 14,123 MVA. Similarly, 33 kV lines now extend over 8,219 circuit kilometers, with substations totaling 3,000 MVA. These developments have improved power evacuation and reduced regional supply bottlenecks.

Improvements in infrastructure and management have also contributed to greater system efficiency. The latest report shows that electricity leakage has declined to 12.73 percent, indicating better control over technical and non-technical losses. Meanwhile, per capita electricity consumption has reached 450 units, reflecting rising household and industrial usage as access to reliable power improves.

Trade in electricity has also expanded during the review period. Nepal exported 2,774 gigawatt-hours of electricity, mainly during the monsoon season when river flows are high. In contrast, it imported 123 gigawatt-hours during the dry months. This pattern underscores the country’s growing role as a seasonal power exporter, while also revealing structural weaknesses in year-round energy management.

Energy analysts note that while the sector’s overall performance is encouraging, long-term sustainability remains a concern. The recurring cycle of winter imports and monsoon exports continues to limit Nepal’s ability to fully capitalize on its hydropower potential. Experts stress the need for greater investment in reservoir-based and pumped-storage projects, along with stronger promotion of solar and wind energy.

They also emphasize that increasing domestic consumption through industrial expansion and electric mobility could help absorb surplus power during peak production periods. Without such measures, Nepal risks continuing its dependence on seasonal trade rather than building a stable, self-reliant energy system.

Overall, the latest data reflects steady progress in Nepal’s electricity sector, supported by expanding capacity, improved infrastructure, and rising consumption. However, addressing seasonal imbalance and diversifying energy sources remain critical challenges. Policymakers and industry stakeholders agree that targeted reforms and long-term planning will be essential to transform Nepal’s growing power sector into a reliable driver of economic growth.

Nepsetrading