Electricity import in winter to almost double

Electricity import in winter to almost double

As per DGPC, the winter electricity that Bhutan will need to import would be about 500 MU, which is double that of last year

From January to March 2022, Bhutan purchased 240 million units (MU) of power from India. However, the current projections indicate that imports this year could almost double and reach 500 MU, as Bhutan continues to witness an increase in energy needs. This is an additional import of 260 MU, compared to the earlier year. 

According to an official from the Druk Green Power Corporation (DGPC), since January 2022, Bhutan has been importing electricity from India due to increased energy needs, particularly during winter.  Speaking about the cost that would be incurred this year, she said that the price fluctuates depending on the month, day, and time of the day. “Thus it is difficult to predict the exact price as there are external factors that impact the prices,” she said. However, she mentioned that the landed cost of power imported would be within the range of Nu 4 to Nu 6 per KWh.

She further added that based on the high domestic demand growth and river inflow trends, Bhutan would need to import electricity till April 2023, leading to a big jump in import of hydro-power.

Meanwhile, in January 2023, the country purchased 88 MU of power from the Indian Energy Exchange (IEX) at the cost of Nu 292 million (mn), which is Nu 3.3 per unit of electricity.

This means the cost of import this year could be around Nu 1.6 billion (bn). This is the rough calculation based on January 2023’s consumption.

“With other associated costs such as transmission charges and losses, trading margins, fees, and charges, the land cost at the consumer end in Bhutan worked out to be around Nu 4.14 per unit. The market clearing price at the IEX was actually Nu 6.17 per unit for the month of January 2023,” the DGPC official said. She also added that the country managed to maintain its price at the IEX at Nu 3.32 per unit through the flexible operation of the plants and importing power from the IEX during the off-peak hours. 

Speaking about the rise in the import of energy, DGPC’s Managing Director, Dasho Chhewang Rinzin, had earlier said that import requirements will further increase over the years till there is some respite with one or two of the mega hydro-power projects that are under construction coming on-line. “To defray some of the uncertainties in availability and tariffs, a viable emerging alternative for Bhutan is solar power with its falling prices,” Dasho mentioned. 

He also said that DGPC in collaboration with the Department of Energy plans to harness 300 to 400 Megawatt (MW) of solar energy, to ensure self-sufficiency in hydro-power.

Dasho had further added that the country will benefit from having more solar power as it receives a lot of sunlight in the winter when river discharges are at their lowest. “In order to address Bhutan’s growing energy security concerns, solar and hydro could complement one another,” Dasho Chewang had stated. Inflation increase

Tshering Pelden from Thimphu