Nepal-India Cross-Border Power Trade: Current Need, and Future Scope

Nepal-India Cross-Border Power Trade: Current Need, and Future Scope

April 15, 2018


The Nepal Electricity Authority (NEA) is the government-owned utility serving approximately 3 million grid-connected customers. The primary objective of NEA is to generate, transmit and distribute adequate, reliable and affordable power by planning, constructing, operating and maintaining all generation, transmission and distribution facilities in Nepal’s power system both interconnected and isolated. During the dry season (Oct-May), Nepal experiences significant power deficit because of high demand, low water flow in the rivers, and the inability to import energy from abroad (especially India. In the fiscal year, 2018/19, NEA could eliminate daily load shedding in the major cities of the country, and limit the same to few (not more than four) hours per day in all other parts, which is significantly less than the previous years. This was possible due to sound operation of the power system, filling up of the Kulekhani reservoir at the onset of the dry season, comparatively a wet monsoon, and most importantly due to large power import from India through various cross-border transmission lines. NEA resorted to all possible means to minimize load shedding; including purchase of all excess energy from the Independent

Power Producers (IPP’s) and all possible import under power exchange agreement and power trade with India. The Integrated Power System (IPS) is there for the smooth evacuation of power from the generating stations to the consumers, i.e. taking care of the overall reliability, security, economy and efficiency of the power system. Power generation in the IPS is mostly done by thermal, hydro and nuclear power, depending on the availability of the resources in each nation. Nepal also has its own Integrated Nepal Power System (INPS), and its generation is based entirely on distributed generation (DG) based hydropower plants. The government has authorized Nepal Electricity Authority (NEA) to plan, develop/execute, operate and maintain the INPS, mandating it with the study, design and construction of hydropower projects as well. An Integrated Power System (IPS) should have electrical energy generating plants for base load (e.g., nuclear and thermal plants) and peak load (e.g., hydropower plants) so that they can work in coordination in such a way that the demand is met in time. In Nepal, INPS is a hydrodominated system where the base and intermediate power demands are covered primarily by run-ofriver hydropower plants and the peak demand by seasonal storage and several diesel power plants of lower capacity. The Government of Nepal has made public plans to add 10 GW in 10 years and 25 GW in 20 years.

Indo Nepal Power Exchange

The concept of Indo-Nepal Power Exchange was first broached in 1950 A.D.  with the inception Kataiya power house in the Koshi Canal. Subsequently Trishuli, Devighat and Fewa Hydro projects were built in Nepal with the assistance of India in the 1970s and 80s. The main objective of building cross-border transmission line at present scenario is to import electricity from India to reduce and eventually eliminate the load shedding hours that had crippled the country in past. Because of the large number of run-offriver plants in NEA’s system, significant energy will be available during the monsoon season, which could be exported to India. There are around 12 active radial points along Nepal-India border for power exchange but the main Nepalese and Indian grid are not permanently connected. Out of these transmission lines, six are of 132 kV and rest are of 33 kV. The electricity brought using 33 kV lines can only be used in areas near Nepal-India border. To supply electricity from India to places like Kathmandu, NEA uses 132 kV transmission lines. All the 132 kV transmission lines are operating in radial (asynchronous) mode. Nepal is importing power from Bihar and Utter Pradesh power grid of India.

The five 132 kV cross-border transmission lines are: 

1.Gandak (Nepal) – Ramnagar and Muzaffarpur (India)

This is the first 132 kV cross-border link (constructed in 1979) and is basically export oriented since it was constructed primarily to transfer power generated by Gandak power house to India under Gandak treaty. Now it has been rearranged for import too, the present capacity being 25 MW. The 132 kV line runs from the Bardghat substation to the Indian substation at Muzaffarpur via Gandak where there is 15 MW of generation, Ramnagar, Bettiah and Motihari. The Indian part of this line lies in the state of Bihar. This interconnection is in the center of the country, relatively close to the load center at Kathmandu and most of Nepal’s generation facilities. Hence, it can be used for both import and export.

2.Kusaha (Nepal)-Kataiya (India)

This link was a gift for the first Democratic Government of 1990. This 132 kV, which is located close to Duhabi in eastern Nepal, was implemented for enhancing the power exchange level up to 50 MW. The objective of this project is to reduce load shedding by increasing import power from India and for cross boarder power exchange enhancement. The overall length is 16-km, approximately 13-km of transmission line from Kusaha to Kataiya near Indo-Nepal Border falls under the Nepalese territory and 3-km falls under Indian Territory. The existing ACSR conductor from Kusaha to Kataiya has been upgraded by the equivalent size high current carrying conductors called Aluminum Conductor Composite Reinforced (ACCR). After this, the line is now able to import around 150 MW Power from India instead of 80 MW.

It does not appear suitable for export from Nepal for the following reasons: 

  • The eastern region of Nepal is a deficit area requiring imports from India; no generation plants are proposed in NEA’s recent generation expansion plan.
  • The market for Nepali power in India is located in the western, northern or southern regional grids; the eastern region of India has a surplus. The power exported from Nepal to India’s eastern region will have to be wheeled back to other regions resulting in significant transmission losses and wheeling charges.

3.Mahendranagar (Nepal) – Tanakpur (India):

This 16-km long 132 kV link was commissioned in December 1999. This interconnection is at the extreme west of the country and is serving a way for receiving 70 million free units of electricity from Tanakpur hydro power plant as per the Integrated Mahakali Treaty. This transmission line is being operated in radial mode up to Kohalpur and is basically an import link owing to the issue of synchronization. As of now, 40 MW is being imported to Nepal through this link. This transmission line is in the far west of the country.

Hence it is also of no significance for exporting power from Nepal for two reasons:

  • There is little generation in western Nepal; generation from the 750 MW West Seti project located here will be evacuated to India via a dedicated transmission line.
  • Exporting significant amount of power past India’s Tanakpur plant may require a significant reinforcement on the Indian system.

4.Dhalkebar (Nepal) – Muzaffarpur (India)

The 140-km double circuit transmission line, commissioned in May 2016, has facilitated power trade between Nepal and India. It’s total length is 126-km, out of which 40-km portion of the transmission line is on the Nepal side and has 115 towers. The completion of the cross-border transmission line has facilitated power trading between Nepal and India after both countries signed Power Trade Agreement(PTA). This line has a capacity to import 120 MW of electricity.

5.Parwanipur (Nepal) – Raxaul (India):

 It is a 22-km line (17-km in Nepal and 5-km in India) with the capacity of 70 MW, presently carrying 50 MW power.



Currently used 33 kV Nepal-India cross-border transmission lines are given below:

6.Siraha – Jaynagar (7 MW)

7.Rajbiraj – Kataiya (10 MW)

8.Jaleshwar – Sitamadi (12 MW)

9.Birgunj – Raxaul (12 MW)

10.Bhairahwa – Nautanawa (5 MW)

11.Nepalgunj – Nanpara (12 MW)

12.Inaruwa – Kataiya (10 MW)

Laying of new Butwal (Nepal)-Gorakhpur (India) and Lumki (Nepal)-Bareilly (India) transmission lines and setting up of new 400 kV sub-stations at Dhalkebar, Butwal and Hetauda — all in Nepal — were discussed during the fourth meeting of the Indo-Nepal Joint Working Group and Joint India-Nepal Steering Committee (JSC) on Power Cooperation.

It is expected to eliminate the energy import from India in coming few years, and export the excess energy generated after Nepal has enough hydel projects ready to operate. The transmission line that is used to import power to Nepal can be used to export excess power to India. Table 1 shows the projects to be commissioned within next few years.

Table 1: Hydropower projects under construction

In the next two years, with the commissioning of several hydel projects, power deficit is likely to be eliminated during wet season with our own generation capacity. However, it is likely to persist in the dry season. By 2020, Nepal’s energy is likely to become surplus in energy terms, but still requiring to import power to meet peak demand during dry season. By the end of 2022, Nepal would be selfdependent in electrical power and would be able to export excess power. Afterwards, the quantity of exported power would increase with the increase in the number of commissioned projects.