Power Transaction From Nepal to Bangladesh Through Indian Grid 

Syllabus:GS 2/IR/GS3/Economy 

In News 

• India, Bangladesh, and Nepal jointly inaugurated the first trilateral power transaction through the Indian grid, marking a significant step toward an integrated South Asian power market.

About Agreement

• A power sales agreement was signed in October  2024, between NTPC Vidyut Vyapar Nigam, Nepal Electricity Authority, and Bangladesh Power Development Board.
• Power Export Details: The power transaction involves the export of up to 40 MW of power from Nepal to Bangladesh through India.
  • The power flow marks the first trilateral power transaction through the Indian grid.
• Expected Impact: The transaction is expected to enhance sub-regional connectivity in the power sector and benefit all stakeholders.
  • It will strengthen cooperation and mutual benefits among India, Nepal, and Bangladesh in the energy sector.

India’s Energy Trade Ambitions:

•  India aims to become a major hub for electricity and refined petroleum product trading in South Asia, including supplying LNG to Sri Lanka and working on an undersea electricity transmission line.
• Current power trading between India and neighboring countries is conducted through bilateral agreements under the 2014 SAARC Framework Agreement for Energy Cooperation.
• Key Agencies: NTPC Vidyut Vyapar Nigam (NVVN) is the nodal agency for cross-border power trading, along with PTC India.
  •  Since 2021, the Indian Energy Exchange (IEX) has facilitated electricity trading with Nepal.
• Policy Enhancements: India introduced market coupling for spot power trading and revised guidelines for import/export of electricity in 2023 to strengthen regional energy cooperation and grid reliability.
  • India is advancing the OSOWOG initiative to create a transnational mega grid enabling renewable energy trade from Southeast Asia to Europe via the Middle East.
  •  India is collaborating with Saudi Arabia, the UAE, and Singapore to develop the OSOWOG grid infrastructure, facilitating low-cost access to renewable energy for participating nations.

Source : TH