In a bid to meet the increasing demand for power in the country and to reduce dependence of scarce thermal coal, the Government of India has intensified its efforts to set up hydroelectric projects (HEP) worth an aggregate capacity of over 10,000 MW in Bhutan. The development of hydropower projects in Bhutan seems like a profitable business, as their energy generation costs are much lower than those of most HEPs set up or proposed to be set up in India.
Further, low domestic requirement of electricity in Bhutan and the geographical proximity of the hydropower-rich country adds to the viability of establishing HEPs and then wheeling the power to India to plug the burgeoning demand-supply gap in the country. According to the Central Electricity Authority (CEA), the development of hydro-electric power in Bhutan is mutually beneficial for both Bhutan and India. The hydropower potential in Bhutan is estimated to be around 30,000 MW. Out of this, 1,480 MW has been harnessed, so far, with the hydro projects developed with Indian assistance accounting for an aggregate capacity of 1,416 MW. The Central agency believes that as India is the primary market for the electricity and is closely associated with the development of the hydro power resources in Bhutan, a system to integrate the approaches of the two countries needs to be evolved.
Pertinently, during the Prime Minister Manmohan Singh`s visit to Bhutan in 2008, Jigme Y Thinley, the first democratically elected Prime Minister of Bhutan, had requested India to enhance the target of exporting 5,000 MW of electricity from Bhutan to India to 10,000 MW by 2020. The Prime Minister had accepted this request and conveyed India`s commitment to assist Bhutan in every way possible. The HEPs that are currently under operation are 1,020 MW Tala, 336MW Chukha and 60 MW Kurichhu HEP. The 1,200 MW Punatsangchhu -I HEP is under implementation and likely to be on stream by 2014.
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