March 22, 2012
Reposted from www.kuenselonline.com
By Nidup Gyeltshen
Bhutan could be earning a yearly gross revenue of around Nu 62B from domestic sale and export of surplus power to India by 2020, a study by the department of energy projects.
But the study also suggests that Bhutan may not be able to harness 10,000MW of power by the year. In 2009, Bhutan and India agreed on a project to tap 10,000MW from Bhutan’s snow fed rivers by 2020, to sell excess power to India.The 2020 gross revenue projections have been worked out, assuming electricity tariffs agreed and outlined in the detailed project reports. “We’ve assumed the tariff rates to be ranging between Nu 2.5 to Nu 4.25 a unit,” the department’s director general, Yeshi Wangdi, said.
The earnings in the projections are from Punatsangchu I and II, Mangdechu, Kholongchu, Amochu, Chamkharchu, Wangchu, Bunakha, Dagachu and Nikachu.
These projects have a combined capacity of 5,176MW. Added to existing generation from four existing projects, the total capacity in 2020 would be 6,664MW.
While calculating the Nu 62B revenue projection, projected earnings from Sunkosh and Kurigongri were not included. DoE officials said they were not sure whether these two projects would be completed by 2020.
The 2,050MW Sunkosh will start construction this year, while Kurigongri, with a likely capacity of 3,400MW, will begin in 2014. The possibility of upsizing Kurigongri from its initial 1,800MW capacity to 3,400MW is also being studied.
“While construction would start, we aren’t sure whether the two projects will start generating electricity in 2020,” the DoE official said. The uncertainty on whether the two projects would be complete before 2020 was because a lot of time was consumed in deciding their size, and the possibilities of downsizing and upsizing them.
“As we move on, their capacity might change,” the DoE official said. “The projected figures have been assumed, considering the tariff rates agreed upon in the DPR.”
DoE officials said that, of the Nu 62B revenue projection, debt repayment will have to be deducted, along with operation and maintenance cost, and interest payment. This will give the actual revenue contribution to government in terms of taxes and dividends.
Since the projects are built on 70 percent loan and 30 percent grant, it would mean that 70 percent of Rs 62B will have to be paid as loan repayment to India over a 12-year period, plus interest.
Today, there are four hydropower projects, with a combined capacity of 1,488MW. The earnings from these projects from export to India is roughly Nu 10B annually, of which Nu 7B is paid back as loan repayment.
“The projected figure is tentative and is exposed to a lot of possibilities of change with time,” Yeshi Wangdi said.
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