Kathmandu, Oct 26: Nepal, once plagued by power cuts lasting up to 18 hours a day, has earned nearly Rs 100 billion from electricity exports over the past decade, marking a major shift in its energy sector.
Expanded hydropower generation has reduced the country’s reliance on imported electricity and enabled it to sell surplus power to India and Bangladesh during the rainy season.
According to the Nepal Electricity Authority (NEA), exports earned nearly Rs 80 billion between fiscal years 2016/17 and 2025/26. Earnings in the first three months of the current fiscal year brought the total to Rs 96.15 billion.
Nepal began selling electricity in India’s open market on October 16, 2021. The NEA now exports power through bilateral agreements with Haryana and Bihar, as well as through the Indian Energy Exchange’s day-ahead and real-time markets.
Exports to Bangladesh resumed on October 23 after a suspension caused by the August 26 Bhotekoshi flood, which damaged the Trishuli and Chilime hydropower plants approved to supply the country. India’s Central Electricity Authority subsequently authorised exports from alternative plants, including Solu, Kabeli-1 and Lower Modi.
Under a five-year agreement signed in October 2024, Nepal can export 40 megawatts daily to Bangladesh from June 15 to November 15 each year.
NEA Executive Director Dirghayu Kumar Shrestha said around two-thirds of electricity exported to India in October was sold under bilateral agreements, with the remainder traded through the Indian Energy Exchange.
Nepal’s electricity trade has changed dramatically. In fiscal year 2016/17, it imported 2.175 billion units of electricity but exported only three million units. Imports cost Rs 16.05 billion, while exports earned just Rs 46 million.
Exports first exceeded imports in volume in fiscal year 2023/24, when Nepal sold 1.946 billion units and imported 1.895 billion units. Export earnings reached Rs 17.04 billion, slightly above the Rs 16.80 billion spent on imports.
In fiscal year 2024/25, exports generated Rs 17.46 billion against import costs of Rs 12.95 billion. The gap widened further in 2025/26, when exports reached 3.965 billion units worth Rs 29.31 billion, while imports fell to 1.171 billion units.
Nepal earned Rs 16.15 billion from electricity exports in the first three months of fiscal year 2026/27, selling 1.767 billion units. September alone generated Rs 5.93 billion.
India has approved around 1,179 megawatts of Nepal’s export capacity following a recent additional clearance for 31 megawatts.
Despite the gains, Nepal faces a seasonal challenge. Run-of-river hydropower plants generate less electricity in winter, when domestic demand must still be met. Sustained export growth will require more reliable transmission infrastructure, continued access to regional markets and sufficient electricity supplies at home.
People’s News Monitoring Service
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