Regional cooperation in energy supply must for energy consumption: Experts

Photo: Dwarika Kafle

Kathmandu: Regional cooperation on energy is among SAARC member countries is a must to uplift the region from one of the lowest per capita energy consumption in the world and also for better economic growth and development in the region, according to business leaders and experts.

Speaking at a session on ‘Regional Integration And Energy Cooperation: Success Through Synergy’ at the ongoing SAARC Business Leaders’ Conclave, they stressed for easy flow of energy across the region for improving energy consumption.

Average per capita energy consumption in South Asia stands at 567 units or kilowatt hours against the global average of 3,000 KWh. Regional per capita consumption is 75 percent lower than the global average.

Presenting a paper on regional energy cooperation, Vijay Karbanda, director of South Asia Regional Initiative for Energy Integration (SARI/EI) said: “Without cooperation and energy supply, I do not think that real economic growth is possible.”

South Asian countries are endowed with diverse energy sources with an estimated combined hydropower potential of 350 GW (primarily of Bhutan, Nepal, India and Pakistan). But only around 15 percent of the potential has been harnessed so far.

Karbanda pointed out the benefits of energy trade between Nepal and India, India and Bangladesh, and Bhutan and India though such trading is at early stages.

“Bangladesh is currently importing about 600 MW from India. It will double soon as energy from India is cheaper compared to import of fossil fuel from abroad,” added Karbanda.

Bangladesh started importing electricity from India in 2015. Story of Nepal is also similar as the country has managed to end load-shedding by importing hydropower from India. While Bhutan has harnessed energy from its two major powers plants and is exporting 1,400 MW to India.

But energy trading is only at bilateral level so far. Trading of energy among member countries like other commodities can lower import of other energy sources which pollute our environment.

A world bank study of 2015 found that regional electricity cooperation in south Asia could lead to savings of US$ 19 billion per year over the next 25 years. Another study of USAID funded SARI/EI showed that accelerated power trade between India and Nepal could increase Nepal’s gross domestic product by over$120 billion in the next 30 years. Likewise, Bangladesh can save 30 percent in energy cost by importing energy from its neighbors.

Speaking at the conclave, US ambassador to Nepal Alaina B Teplitz said: “All of these studies and recent actions clearly show how extending and expanding cross border electricity trade in the region will benefit everyone providing the basis for greater economic growth and development.” She further added that energy cooperation is not just about increasing integration but is also an essential building block for regional prosperity.

South Asian countries have already signed a Framework Agreement on Energy Cooperation in 2014, and Nepal and India signed Power Trade Agreement in the same year.

Mohammad Tamim, a professor at Bangladesh University of Engineering and Technology, said that the there is a need for conducive policies for investment and economic liberalization for achieving these targets.

Likewise, Deepak Amitabh, chairman and managing director of PTC India, said that the region is rich is hydropower. “The only thing we need is balancing the energy supply,” he said, adding, “Like Nepal can export energy to India during wet months, and can purchase from its southern neighbor during dry months.”