Situation of Hydro Power


Nepal has a huge hydropower potential. In fact, the perennial nature of Nepali rivers and the steep gradient of the country’s topography provide ideal conditions for the development of some of the world’s largest hydroelectric projects in Nepal. Current estimates are that Nepal has approximately 40,000 MW of economically feasible hydropower potential. However, the present situation is that Nepal has developed only approximately 600 MW of hydropower. Therefore, bulk of the economically feasible generation has not been realized yet. Besides, the multipurpose, secondary and tertiary benefits have not been realized from the development of its rivers.

Although bestowed with tremendous hydropower resources, only about 40% of Nepal’s population has access to electricity. Most of the power plants in Nepal are run-of-river type with energy available in excess of the in-country demand during the monsoon season and deficit during the dry season.

Nepal’s electricity generation is dominated by hydropower, though in the entire scenario of energy use of the country, the electricity is a tiny fraction, only 1% energy need is fulfilled by electricity. The bulk of the energy need is dominated by fuel wood (68%), agricultural waste (15%), animal dung (8%) and imported fossil fuel (8%). The other fact is that only about 40% of Nepal’s population has access to electricity. With this scenario and having immense potential of hydropower development, it is important for Nepal to increase its energy dependency on electricity with hydropower development. This contributes to deforestation, soil erosion and depletion, and increased flooding downstream in the Ganges plain. Shortage of wood also pushes farmers to burn animal dung, which is needed for agriculture. Not only this, the development of hydropower will help to achieve the millennium development goals with protecting environment, increasing literacy, improving health of children and women with better energy. Growing environmental degradation adds a sense of urgency.


Energy Consumption in Nepal

The electricity demand in Nepal is increasing by about 7-9% per year. About 40 % of population in Nepal has access to electricity through the grid and off grid system. Nepal’s Tenth Five Year Plan (2002– 2007) aimed to extend the electrification within country and export to India for mutual benefit. The new Hydropower Policy 2001 seeks to promote private sector investment in the sector of hydropower development and aims to expand the electrification within the country and export.

The hydropower system in Nepal is dominated by run-of-river Projects. There is only one seasonal storage project in the system. There is shortage of power during winter and spill during wet season. The load factor is quite low as the majority of the consumption is dominated by household use. This imbalance has clearly shown the need for storage projects, and hence, cooperation between the two neighboring countries is essential for the best use of the hydro resource for mutual benefit.

The system loss is one of the major issues to be addressed to improve the power system which accounts to be 25 % including technical and non-technical losses like pilferage.

Status of Power Generation and Transmission

Nepal has 600 MW of installed capacity in its Integrated Nepal Power System (INPS). The power system is dominated by the hydropower which contributes about 90 % of the system and the balance is met by multi fuel plant. The hydropower development in Nepal began with the development of 500 kW Pharping power plant in 1911. The most recent significant power plant commissioned is the 144-MW Kali Gandaki “A” Hydroelectric Plant.

Transmission Network in Nepal

Until 1990, hydropower development was under the domain of government utility, Nepal Electricity Authority (NEA) only. However, with the enactment of new Hydropower Development Policy 1992, the sector was opened to the private sector also. There are number of projects already built by the private developers. Private power producers contribute 148 MW of power to the ‘Integrated Nepal Power System’.

Future of Nepal’s Electricity: Demand Forecast and Possible Issues

Looking at the current power-crisis of Nepal, it is even hard to make future energy plans without addressing present power shortage problems. However, I believe that it’s a high time that we have a long-term electricity plan by keeping the future demand growth in mind.

Nepal Electricity Authority (NEA) estimates that the electricity demand will increase steadily at the average annual growth of 9 % and peak demand will increase by 8.85% in the same period. Energy (kWh or MWh or GWh) is the total hourly electricity demand summed for each year, whereas system peak load (kW or MW or GW) is the maximum amount of electricity demanded at any given time of the year. For the smooth supply of electricity, the utility company (NEA) has to be able to meet both total annual electricity demand and also be able to handle the peak load demand.

As we can see in the figure, the demand of electricity is projected to increase from 4.4 TWh [Note-1] in 2011 to 17 TWh in 2027, a 300% growth in 16 years! Similarly, the system peak load is projected to increase by 250% from 1056 MW to 3680 MW in the same period. The source of the data is NEA’s Annual report and it is not clear that if this growth estimates includes the amount of electricity required for areas that are not connected to the national grid.

Can we meet the forecasted demand in 2027 with the business-as-usual scenario; that is just focusing on the run-off the river projects?

May be not! Given the nature of the runoff-the-river hydro power plants and variations in the amount of water available in the river (throughout the year), NEA will have more electricity during the rainy season than during the dry season. NEA might be able to meet the demand during the rainy season. However, there will be shortages during the dry (winter) season. How will NEA get the extra electricity needed for the winter? Build hydro-plants just to operate during the winter? This is the issue that we will face in the supply side; let’s talk about demand side problems in the long run.

We can also face the problem in the demand side of electricity, at the end-user customers. NEA has to be ready to supply any amount of electricity at a given amount of time. The system load increases during the high demand period and the national grid has to be capable of supplying this electricity. How do we address the issues that comes with the high demand period?

These are just couple of issues that we have to think about while making long-term plans with an objective of creating a sustainable and adequate electricity system. We have to address from both supply and demand sides. Government has to emphasis on increasing fuel diversity in the national grid. Or the other idea would be to have an agreement (and construct transmission line to transfer bulk power) with India so that Nepal can sell excess electricity during rainy season and buy electricity from India during the winter season.

Similarly, many other policies can be formed which can address the issue in future. This can be discussed later on.

[Note-1]:- 1 TWh = 1000 GWh = 10MWh = 10kWh = 1012 Wh