Bangladesh contacts NEA to sign electricity power purchase agreement

KATHMANDU: Bangladesh Power Development Board (BPDB) has formally contacted the Nepal Electricity Authority (NEA) to establish an agreement for the sale and purchase of 40 megawatts (MW) of electricity generated in Nepal.

The BPDB initiated this communication, informing the NEA that their tender submission for the sale of 40MW of power during the rainy season has been approved by the relevant authorities. Under legal provisions, a trilateral agreement was signed on January 1, 2024, involving Nepal, India, and Bangladesh, specifically for the sale of 40MW of electricity produced in Nepal.

The NEA had previously issued a tender for the power trade over five years. The BPDB confirmed the approval of this tender after evaluating the associated documents. As part of the process, the NEA must provide written notice of the tender's approval within seven working days. Subsequently, the BPDB will share a draft agreement regarding the power trade with the NEA.

The agreement itself is expected to be finalised within 28 days of receiving the draft. It will involve NEA, NTPC Vidyut Vyapar Nigam (VVN) from India, and the BPDB.

NEA's Executive Director, Kul Man Ghising, has confirmed that preparations are underway to export power to Bangladesh during the upcoming monsoon season. With all three agencies in agreement regarding the trilateral power trading agreement, the formal pact will be signed soon. Following this, a list of projects will be submitted to India's Central Power Authority for approval to export power to Bangladesh.

To facilitate this power exchange, NEA has made arrangements to export electricity generated from projects constructed with Indian grant funding. Specifically, the power generated from the 25MW Trishuli and 22MW Chilime hydropower projects, both built by NEA's subsidiary company, will be sold to Bangladesh.

The agreed-upon rate for this power export is $6.40 per unit. The NEA will export electricity via the inter-country Dhalkebar-Muzafarpur 400 kV transmission line, located at the Muzaffarpur point in India. Notably, this transmission line represents the first inter-country connection between Nepal and India. The electricity meter for the power exported to Bangladesh will be installed at Muzaffarpur. Additionally, NEA will cover the cost of any technical leakage occurring on the transmission line between Dhalkebar and Muzaffarpur.

Ultimately, the electricity exported from Nepal will reach Bangladesh via the Baharampur (India)-Bhermara (Bangladesh) 400kV transmission line within India.