Govt. targets doubling hydropower capacity in the 13th FYP


The Ministry of Finance secured USD 5 million concessional loan from the Asian Development Bank (ADB) for two significant hydropower projects in Bhutan.

The loan, intended to update the Detailed Project Reports (DPRs) for the 404 MW Nyera Amari I and II in Samdrup Jongkhar and the 180 MW Bunakha Reservoir in Chukha, marked a crucial step in Bhutan’s ambitious energy expansion plans.

The Project Preparedness Financing Agreement was signed on December 18, 2023, between the Ministry of Finance, ADB, and Druk Green Power Corporation (DGPC).

This agreement encapsulated Bhutan’s commitment to advancing its hydropower capabilities and aligned with the government’s broader vision of sustainable development through renewable energy. The concessional loan aimed to facilitate comprehensive updates to the DPRs, ensuring both projects met modern standards and requirements, paving the way for efficient and effective implementation.

Speaking at the 5th Meet the Press session, Energy and Natural Resources Secretary Karma Tshering highlighted the government’s strategic focus on hydropower within the 13th Five-Year Plan. He emphasized that the government aimed to complete ongoing projects and initiate several new ones, with a target to enhance the country’s energy generation capacity significantly.

“Our current hydropower plants have a combined generation capacity of over 2,500 MW. With the completion of planned projects, we expect this capacity to increase to up to 6,000 MW by the end of the 13th Five-Year Plan,” Secretary Karma Tshering stated. This ambitious goal reflected Bhutan’s determination to harness its vast hydropower potential, which is crucial for the country’s economic growth and energy security.

The ADB loan was part of a broader strategy to ensure that Bhutan’s hydropower development was both sustainable and beneficial for the environment and local communities. The updates to the DPRs included comprehensive environmental and social impact assessments, ensuring that the projects aligned with Bhutan’s stringent environmental regulations and the ADB’s safeguards.

The Nyera Amari I and II projects, with a combined capacity of 404 MW, are poised to significantly boost the energy supply in the eastern region of Samdrup Jongkhar. Similarly, the 180 MW Bunakha Reservoir in Chukha was expected to enhance water storage capacity, ensuring a steady flow of water for power generation even during dry seasons.

These projects are expected to contribute substantially to the stability and reliability of Bhutan’s power grid.

The development of these hydropower projects was anticipated to bring substantial economic and social benefits to the regions involved. Job creation during the construction and operational phases was expected to provide employment opportunities for local communities, fostering economic growth and improving livelihoods.

Additionally, the increased power generation capacity was expected to support Bhutan’s domestic energy needs and enhance export potential, contributing to national revenue.

Furthermore, Secretary Karma Tshering mentioned that the government was exploring additional funding sources and partnerships to support the development of 17 mega and mini hydropower projects included in the 13th Five-Year Plan. These projects are expected to collectively contribute to Bhutan’s vision of achieving energy self-sufficiency and becoming a major exporter of renewable energy in the region.

The USD 5 million ADB loan for the Nyera Amari I and II and Bunakha Reservoir hydropower projects signifies a major milestone in Bhutan’s renewable energy journey. By updating the DPRs and ensuring comprehensive planning and assessment, Bhutan is poised to enhance its hydropower infrastructure significantly.

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