India set to allow Nepali power producers access to Indian power market

India will allow Nepali power producers to access the Indian power market, confirmed the Indian embassy in Kathmandu. It said that doing so will provide and outlet for Nepal’s surplus power in the coming months.

In recent years, India-Nepal have been coordinating closely in the field of power and energy, with both countries having made considerable progress in the last five years. Some of the noted projects have been South Asia’s first cross border 400 KV transmission line at Muzaffarpur-Dhalkebar; agreement on funding modality for Gorakhpur-Butwal 400KV line for which the construction is expected to commence soon, as well as the brisk progress on the 900 MW Arun-III Hydro Electric Project.

The embassy, in an official statement, said the power and energy secretaries of India and Nepal co-chaired the 8^th meeting of Joint Steering Committee (JSC) on cooperation in the Power sector that was held through a video conference. Both countries discussed, inter alia, development of suitable rules and guidelines for allowing access to Nepali power producers to Indian markets, development of energy banking mechanism, development of cross border high voltage transmission lines as well as reviewing the progress of the SJVN Limited-developed 900MW Arun-III Hydro Electric Project in Nepal, the embassy highlighted in the meeting.

Furthermore, both sides reaffirmed their commitment to further strengthen the power cooperation. This includes the development of an integrated grid, building of more cross border transmission lines and investing in Nepal’s hydro and solar power projects.

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According to a CII report, there are transmission interconnections in the border areas for mutual exchange of power in the deficit areas on either side. It states that both countries, in principle, have agreed to increase the quantum of power exchange from 50 MW to 150 MW.