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"Cross Border Power Trade in South Asia"

image credit: Hydel Potential in South Asia

Outline:

a) Synopsis

b) Energy Sources and Future Requirements

c) Importance of Cross Boarder Interconnections

d) Efforts by regional organizations

e) Conclusion

21st century is witnessing South Asia as one of the fastest growing regions of the world. The continuous development has consequently resulted in an increased demand for energy in multiple sectors which is indispensable for the overall sustainability in South Asia. The region has considerable amount of energy resources which are spread across the countries in very dissimilar fashion. The present countries of Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, India, Pakistan, and Sri Lanka form South Asia. South Asia presents a picture of broad variety with respect to composition of fuels produced and consumed in different countries, the relative magnitude of consumption, and the ease of accessibility of these resources. Hydel, coal, fossil fuels and renewable resources are main source of energy in all these countries.

South Asia is blessed with an enormous potential for hydropower but the countries have limited financial resources to exploit it all. Hydropower is very cheap and clean source of energy as compared to other energy sources. Some countries in the region are predominantly dependent on a single energy resource i.e. furnace oil and natural gas. At the same time, many of these countries struggle to improve access to electricity for remote and impoverished areas, where approximately millions of people are yet to be connected to the grid. Central Asia can provide surplus energy to Pakistan and other countries through cross border interconnection transmission system.

The development of hydropower with diverse energy potential and related transmission strengthening for power evacuation including cross border interconnections becomes a major focus in the sustainable development of these countries. The interconnections between India-Bangladesh are already established. Large capacity interconnections exist between Bhutan and India as well. The annual power transfer between India and Bhutan has grown considerably over the years. Likewise, the first large capacity interconnection between India and Nepal also has a big impact on their development. The main drivers for the interconnections are the power deficits faced by the countries and the political commitment of the governments to proceed with power trading.

SAARC is a regional organization for cooperation in South Asia. The organization is playing a vital role in building consensus on terms and conditions for cross border power trading among regional countries. SAARC Regional Energy Trade Study (SRETS) has identified many opportunities for power trading in South Asian region and the needs relating to the development of related infrastructure. Asia Development Bank (ADB) is also providing legal and financial assistance to the countries of South Asia in carrying out feasibility studies. It is almost evident from all the completed interconnections projects that the proposed method of power sharing is extremely vital.

It is concluded that cross-border power trading together with a regulatory framework across the region that enforces a strong economic stability would maximize the benefits from the development of interconnection projects among South Asian countries considered in an orderly manner.

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Syed Waqar Ali's picture

Thank Syed Waqar for the Post!

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