Integrated analysis of end-use electrification and cross-border electricity trade policies for hydropower enabled energy transformation in Nepal

Sushil Aryal, Shobhakar Dhakal and Samrat Kc

Renewable Energy, 2023, vol. 219, issue P1

Abstract: Whether an enormous untapped hydropower resource should be utilized domestically by heavily electrifying energy end-uses or should be exported to neighboring countries is often debated in Nepal. This study attempts to bring both policy options together and justifies with evidence the need to integrate end-use electrification and cross-border electricity trade policies in the energy transformation of Nepal. We found out that Nepal will continue to import electricity till 2027 to meet its electricity demand throughout the year though it has already started exporting its surplus electricity during the wet season because of the full availability of run-of-river type hydropower. The run-of-river will continue to dominate Nepal's least-cost generation mix with a two-thirds share resulting in considerable surplus electricity during the high-flow season. Such surplus will exceed one-third of its total energy generation capacity in long-run in all end-use electrification scenarios (low to high). Nepal can use its existing cross-border electricity trade mechanism to sell its surplus electricity and can generate revenue of 67 billion USD in the high electrification scenario, which, combined with savings from fossil fuel import savings, can provide 85 % of total electricity generation investment needs.

Keywords: Electrification; Cross-border electricity trade; Hydropower; Energy security; Climate change mitigation; Renewable energy (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:219:y:2023:i:p1:s0960148123013824

DOI: 10.1016/j.renene.2023.119467

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