The Ministry of Energy, Water Resources and Irrigation is preparing to sign a memorandum of understanding (MoU) with Bangladesh to strengthen energy cooperation between the two countries.
Nepal and Bangladesh have been talking on bilateral energy cooperation since the power trade agreement (PTA) was signed with India in 2014. Nepal has identified Bangladesh as a prospective market for hydroelectricity, which is a clean and renewable source of energy.
Following the SAARC member states agreement on ‘SAARC Framework Agreement for Energy Cooperation (Electricity)’ in November 2014, Nepal and Bangladesh have seen the prospects of bilateral power cooperation.
Recently, Energy Minister Barshaman Pun also said that the government is preparing to sign an MoU on energy cooperation with Bangladesh through which the country can lure investment from Bangladesh to exploit Nepal’s hydro resources.
However, to materialise power trade between the two nations, Nepal and Bangladesh need to hold talks with India. As there is power trade between Nepal and India, and also Bangladesh and India, power trade between Nepal and Bangladesh is not a far-fetched notion, according to Ambassador of Bangladesh to Nepal, Mashfee Binte Shams.
Ambassador Shams said that both countries are preparing to sign an MoU on energy cooperation and they can enter into a power trade agreement, which is a more specific document. However, trilateral consensus is must for the PTA to be signed.
There is prospect of energy trade between Nepal and Bangladesh as GMR Energy India has signed MoU to sell power produced from Upper Karnali Hydropower Project, which is going to be developed under Indian investment to Bangladesh.
For this purpose, an initial MoU regarding connection agreement has already been signed with Bangladesh Power Development Board (BPDB) during the visit of Bangladeshi Prime Minister Sheikh Hasina to India in April last year.
Bangladesh’s current electricity generation stands at around 16,000 megawatts and it will require around 34,000 megawatts of power by 2030 to sustain the high economic growth of above seven per cent.
As participating nations have envisioned providing access to sustainable, clean and affordable energy to their citizens by 2030 under the Sustainable Development Goals, Bangladesh has taken Nepal’s hydroelectricity as a reliable source for the rising demand of clean and reliable energy, as per Ambassador Shams.
Energy consumption is relatively low in South Asia as per capita energy consumption stands at 650 kilowatt hours (units) compared to global average energy consumption of 3000 kilowatt hours.