The year 2024 marked a landmark period for Bhutan’s renewable energy sector, with substantial progress achieved in key projects and milestones that underscored the country’s strategic focus on renewable energy. While hydropower remains central to Bhutan’s economic growth and its long-standing bilateral partnership with India, solar power has come a long way in contributing to the energy needs of the country where hydropower energy had lesser impacts.
On December 17, Bhutan’s National Day, Units 1 and 2 of the 1,020 MW PHPA-II, each with a capacity of 170 MW, were successfully synchronized with the national grid. This achievement marks a crucial step in the project’s progress toward full operational status, expected in 2025.
The units are currently undergoing mandatory grid code tests before receiving the Commercial Operation Date (COD) certification. Once fully operational, PHPA-II will increase Bhutan’s total installed hydropower capacity to 3,465 MW, solidifying its role as a major energy producer in the region.
The commissioning of two PHPA-II units during Bhutan’s lean hydropower season has significantly boosted domestic power generation. This milestone has reduced Bhutan’s reliance on electricity imports from India, strengthening the country’s energy security.
Reinforcing Bhutan-India cooperation, the year highlighted the enduring partnership between Bhutan and India in the hydropower sector. To date, the two nations have collaborated on four major operational projects viz-a-viz Chhukha HEP (336 MW), Kurichhu HEP (60 MW), Tala HEP (1,020 MW), and Mangdechhu HEP (720 MW).
PHPA-II, funded through a 30% grant and a 70% loan from the Government of India, is a testament to this cooperative relationship. Once fully commissioned, it will further strengthen economic ties between the two countries.
In other notable projects, progress continues on the 1,200 MW Punatsangchhu-I HEP, despite geological and financial challenges, while preparatory work and feasibility studies for additional hydropower projects in the Punatsangchhu basin, as identified in Bhutan’s Power System Master Plan (PSMP), also moved forward.
Hydropower remains the backbone of Bhutan’s economy, driving revenue generation and sustainable development. The sector plays a pivotal role in achieving Bhutan’s environmental and economic goals. Hydropower is Bhutan’s largest source of revenue, contributing significantly to the country’s GDP through electricity exports to India.
As a renewable energy source, hydropower aligns with Bhutan’s commitment to carbon neutrality and its status as a net carbon sink. The hydropower sector continues to deepen economic and diplomatic ties with India, providing mutual benefits and fostering regional cooperation. Bhutan remains steadfast in its goal to achieve an installed capacity of 10,000 MW as part of the Bhutan-India 2008 initiative.
The achievements of 2024 signal Bhutan’s resilience and strategic focus in navigating challenges within its hydropower sector. With ongoing projects nearing completion and a new initiative in the pipeline, Bhutan is well-positioned to harness its vast hydropower potential, ensuring sustainable growth and energy-driven prosperity for years to come.
In the midst of all these developments, challenges like delays in synchronization efforts were encountered due to technical issues, including water seepage in the powerhouse. These challenges were resolved through comprehensive inspections and the application of specialized grouting and penetron coatings to critical infrastructure components such as the surge shaft and head race tunnel. Bhutan and India have also advanced discussions on electricity export tariffs, a key financial component of Bhutan’s hydropower strategy.
Along the similar lines, Bhutan achieved notable progress in its solar energy sector in the past year, reflecting its growing emphasis on diversifying its source of renewable energy. Historically reliant on hydropower, Bhutan has begun to tap into solar energy as a complementary source to address seasonal fluctuations in power generation and enhance energy security.
Key solar energy developments in Bhutan in 2024 include the inauguration of Bhutan’s largest solar farm in Sephu, Wangduephodrang, with a capacity of 30 MW, marking a significant step toward diversifying the country’s energy mix. The project is expected to generate approximately 42 GWh annually, enough to power 10,000 households, and reduce seasonal power deficits.
On top of that, the country scaled up solar rooftop installations. The National Solar Rooftop Program saw a substantial increase in adoption, with over 5,000 households and businesses installing solar panels across the country.
Subsidies and tax incentives provided by the government encouraged greater participation, particularly in rural and off-grid areas.
Pilot projects in remote communities like the installation of solar microgrids in Laya and Lunana provided electricity to communities previously dependent on kerosene and firewood. These projects ensured reliable and sustainable energy access while reducing the carbon footprint in high-altitude areas.
The government unveiled the Bhutan Solar Energy Development Roadmap 2040, outlining plans to achieve a solar energy capacity of 500 MW by 2040. Key components include scaling up utility-scale solar farms, rooftop installations, and hybrid renewable energy systems.
Bhutan partnered with private companies to attract investment and expertise in the solar sector. Collaborative projects aimed to integrate solar energy into Bhutan’s energy grid while ensuring economic viability and technical innovation were also launched.
Hybrid systems combining solar energy with existing hydropower infrastructure were piloted to address seasonal water shortages and maintain a consistent energy supply. These initiatives showcased the potential for synergy between solar and hydropower, enhancing grid stability and efficiency.
In the field of training and capacity building, the government launched programs to train solar energy technicians, creating a skilled workforce to support the sector’s growth. Partnerships with academic institutions and international organizations provided technical knowledge and research opportunities.
Solar energy was integrated into public buildings and infrastructure, including schools, hospitals, and government offices, reducing energy costs and promoting sustainability. Streetlights powered by solar panels were installed in Thimphu and other urban areas, contributing to energy savings and reducing dependence on the national grid.
In the global context, Bhutan joined the International Solar Alliance (ISA), strengthening its commitment to global solar energy initiatives and leveraging international expertise and funding. Collaboration with India and other regional partners facilitated knowledge exchange and investment in Bhutan’s solar projects.
The government encouraged research into advanced solar technologies, including battery storage solutions and solar thermal systems, to optimize energy use and improve efficiency. Pilot projects tested the feasibility of agrivoltaics (combining agriculture and solar energy) in Bhutan’s unique terrain.
As a result of these efforts, solar energy provided a crucial backup during the lean season when hydropower generation declines, reducing reliance on imports. Investment in solar energy created jobs, supported local businesses, and attracted foreign direct investment.
Increased use of solar energy reduced greenhouse gas emissions and aligned with Bhutan’s carbon-neutral commitments. Remote and off-grid regions gained access to reliable electricity, improving quality of life and opportunities for economic activities.
The strides made in Bhutan’s solar energy sector in 2024 demonstrate the country’s commitment to leveraging renewable energy for sustainable development. As Bhutan continues to expand its solar capacity, it aims to solidify its position as a regional leader in clean energy, complementing its hydropower resources and advancing its vision of energy self-sufficiency.
By Tashi Namgyal From Thimphu
