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Nepal’s Quest for a Digitized Healthcare System: The Importance of Electrification

SAHESHA Upadhyay


The WHO recommends a minimum of 2.5 health workers per 1,000 population as a general benchmark to ensure adequate access to essential health services. This ratio appears as an unconvincing goal for Nepal given its current ratio of  8.52 per 10,000 (or 0.85 per 1,000 population). This presents a major challenge in terms of healthcare access, particularly in rural areas where mountainous terrain has impeded infrastructure development. The emergence of digital healthcare technology, including telemedicine, tele-visits, remote monitoring, IoT equipment, wearables, and digital healthcare database management, offers a promising solution to bridge this gap. The successful integration of a digital healthcare system requires efficient and dependable energy infrastructure as a foundation. Nepal, therefore, needs to align its healthcare and energy goals if it is to fully realize the potential of digital healthcare technology. 

Medical Doctors per 10,000 population

Snapshot of Digital Healthcare in Nepal  

In recognition of the potential impact of digital health on healthcare accessibility and quality, Nepal’s Digital Framework 2019 has identified health as one of its eight priority sectors and established seven initiatives aimed at leveraging digital tools and technologies that include:

  1. National Digital Healthcare Platform
  2. Next-Generation Digital Healthcare Facilities
  3. Electronic Health Records 2.0
  4. Mobile Health Units 
  5. e-Maternal Care
  6. Drones for delivery of emergency medical supplies
  7. Centralized Telemedicine Center

Several online platforms, including Jeeve, Hamro Patro, TeleCareNepal, Tele Upchar, and Hello Health, have successfully been delivering digital healthcare services in Nepal. Their services range from e-consultation and drug prescription to drug delivery to electronic management of healthcare records. Post-COVID-19, Nepal’s telehealth and digital health technology sector has witnessed a significant growth. Despite Nepal’s healthcare system being on the brink of collapse during the pandemic, the need for innovative solutions that could deliver healthcare services to people remotely was amplified. As a result, the utilization of Internet and telephone technologies for consultations skyrocketed in both hospitals and clinics, with numerous new and cutting-edge applications emerging. Furthermore, the country experienced a remarkable transformation in digital payment technologies and services, contributing to the widespread adoption of digital health channels.

Electrification and Healthcare

Despite all the possibilities that digital technologies offer, the challenge is to equip these technologies with the best resources that will keep them running smoothly. Electrical power remains the backbone of hospital operations; we need it not only for powering specific healthcare devices and technologies but also for basic office operations works including lighting, communication, and refrigeration. We cannot emphasize the term “reliability” enough when discussing the availability of electricity in regard to healthcare access. Interruptions in electricity, even for just a few minutes, can have dire consequences, such as life-saving devices failing during medical procedures, or critical medicines becoming spoiled due to loss of refrigeration. Likewise, tele-visits and remote-diagnoses are out of the question, when electricity is simply not dependable. Electricity must be ubiquitous in Nepal for healthcare access to be universal.

We cannot overemphasize the term “reliability” when discussing the availability of electricity in regard to healthcare access. The Energy Progress Report 2020  indicates that 90 percent of Nepal’s population has access to electricity, yet despite this achievement, frequent power cuts in rural areas continue to pose difficulties for the proper functioning of healthcare facilities. According to the Nepal Electricity Authority, several districts, including Ilam, Panchthar, Taplejung, Okhaldhunga, Khotang, Solukhumbu, Bhojpur, Sankhuwasabha, Udayapur, Kavre, Makwanpur, Dhading, Nawalpur, Darchula, and Dolpa have very low electrification;  Dolpa, Mugu, and Humla of Karnali Province have no connection to the national grid at all. The World Health Organization (WHO) also reports that only 65 percent of hospitals and 56 percent of non-hospital healthcare facilities in Nepal have a steady supply of electricity. Likewise, four percent of healthcare facilities in the country do not have access to any electricity supply. The issue of limited access to reliable electricity in healthcare facilities affects nearly one billion people globally, as reported by the United Nations.

For telemedicine and remote-diagnostic technologies to be successful, it is not only crucial for hospitals but also for individual households to have access to reliable electricity. Despite the widespread availability of affordable mobile devices and the expansion of 3G and 4G networks, which have led to a 90 percent coverage of wireless networks in Nepal, there are still significant gaps in coverage, particularly in rural areas. These limitations hinder effective telemedicine visits and remote diagnostics. As such, ensuring access to reliable electricity is essential for both powering devices and providing reliable broadband internet access.

Way Forward

The integration of alternative energy sources such as solar panels holds great promise as a transformative solution that can revolutionize healthcare services in Nepal. In many rural areas, solar power initiatives have already been successful, with 15 percent of the population gaining access to electricity through solar grids as reported by Nepal News news portal. Moreover, the cost of solar panels has decreased significantly in recent years, making it a more viable option for expanding healthcare services. By expanding these programs to rural healthcare facilities, Nepal can significantly improve the digitization of its healthcare technology and make healthcare facilities more reliable.

One way to achieve this is by implementing projects aimed at decentralizing electricity by providing every remote healthcare facility with its own solar panel grid. This not only has the potential to enhance service delivery but also make electricity access more resilient. Catastrophic climate events or any other national emergency will not interrupt the operation of specific healthcare facilities. A great example of this is St. Luke’s Hospital in Ethiopia, where a private renewable energy company provided assistance in implementing a groundbreaking solar hybrid system that delivers 320 KWh of electricity. This resulted in significant cost savings and improved service delivery.

In addition to its impact on healthcare delivery, the electrification of healthcare facilities can also have a profound effect on the distribution of healthcare professionals. A study has shown that access to reliable electricity and digital healthcare technology can serve as a powerful incentive for healthcare professionals, particularly in rural and remote areas. By making healthcare facilities more appealing and attractive, electrification can help attract and retain healthcare professionals in these areas, thereby increasing the availability of healthcare services for communities in need.

To ensure the longevity and effectiveness of these projects, regular maintenance of power plants and medical equipment, as well as personnel training, must be prioritized in the healthcare project design and budgeting process. Effective collaboration between stakeholders from both the healthcare and energy sectors, including public and private entities, can guarantee that healthcare needs are taken into consideration during the design and implementation of electrification projects. Finally, it is also important to draw attention to the fact that the adoption of digital healthcare, particularly telehealth, has far-reaching benefits that go beyond just improving individual health outcomes in rural areas. In addition to providing convenient access to medical services, by eliminating the need for frequent doctor-patient commutes, telehealth significantly reduces the carbon footprint associated with transportation

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जलविद्युत् र हाइड्रोजन ऊर्जाको उपयोग

– निश्चल ढुङ्गेल

यो लेख १६ फेब्रुअरी २०२३ मा प्रकाशित भएको थियो। मूल लेख यहाँ पढ्नुहोस्

जलवायु परिवर्तनमा नवीकरणीय ऊर्जाले गति लिइरहँदा विश्वको ध्यान नवीकरणीय ऊर्जा स्रोतलाई दोब्बर बनाउनेतर्फ केन्द्रित छ । सन् १९६५ मा ९४१ टेरावाट घन्टाबाट सन् २०२१ मा ७,९३१ टेरावाट घन्टामा नवीकरणीय स्रोतको उत्पादनमा उल्लेखनीय वृद्धि भयो । यस सन्दर्भमा धेरै नदी र खोला भएको नेपाल दक्षिण एसियाका लागि ऊर्जा सुरक्षाको आधारशिला बन्न सक्छ । देशको अप्रयुक्त जलविद्युत्ले भविष्यको ऊर्जा आपूर्तिमा महत्वपूर्ण भूमिका खेल्न सक्छ । साथै, भारत र बंगलादेशको कार्बन फुटप्रिन्टलाई पनि कम गर्न सक्छ ।

ऊर्जा विकासको मार्गचित्र कार्यान्वयन गर्न नेपालले ऊर्जा तथा जलस्रोत दशक (२०१८–२८) घोषणा गरेको छ । नेपाल अहिले विद्युत् उत्पादनमा आत्मनिर्भर छ । सन् २०१३ मा ४,२५८ गिगावाटबाट ०२२ मा ११,०६४ गिगावाट उत्पादनका साथ उल्लेखनीय वृद्धि भएको छ । अरुण चौथो (क्षमता ४९०.२ मेगावाट), पश्चिम सेती (७५० मेगावाट), अरुण तेस्रो (९०० मेगावाट) र तल्लो अरुण (७६९ मेगावाट) प्रमुख जलविद्युत् आयोजना हुन्, जसले सन् २०३० देखि०३५ सम्म वितरण सुरु गर्नेछन् । ऊर्जा उत्पादन र निर्यातमा वृद्धि र ऊर्जा आयात घटेको छ । हामीले यो अतिरिक्त ऊर्जा कहाँ प्रयोग गर्ने ?

आदर्श जवाफ यो परम्परागत वा गैरनवीकरणीय ऊर्जा प्रतिस्थापन गर्न प्रयोग हुनेछ । भारतले दक्षिण एसियामा व्यापार विस्तार गर्ने लक्ष्य राखेको इन्डियन इनर्जी एक्सचेन्जमा सहभागी हुने नेपाल दक्षिण एसियाकै पहिलो देश बनेको छ । आज देशको कुल आयातको १४.१ प्रतिशत पेट्रोलियम पदार्थको हुन्छ । यसलाई विद्युत्ले सजिलै प्रतिस्थापन गर्न सकिन्छ । नेपालको जलविद्युत्ले दक्षिण एसियाको एकतिहाइ भागलाई गैरनवीकरणीयबाट नवीकरणीय ऊर्जा उपभोगमा परिणत गर्न सक्छ । यसो गर्दा सन् ०४० सम्म विश्वभर हुने कुल हरितगृह ग्यास उत्सर्जनको झन्डै ३.५ प्रतिशत घट्नेछ ।

नयाँ विद्युत् ऐन कहिले पारित होला ? :  डेढ दशक बितिसक्दा पनि नेपाल सरकारले नयाँ विद्युत् ऐन ल्याउन सकेको छैन । कानुन निर्माणमा भएको ढिलासुस्तीले देशको ऊर्जा क्षेत्रको अपेक्षित विकासमा बाधा पु¥याएको छ । अहिले विद्युत् ऐन–१९९२ संशोधन गर्ने विधेयक राष्ट्रिय सभाको कार्यक्षेत्रमा छ । विद्युत् ऐन–१९९२ लाई संशोधन गर्ने विधेयकमा विद्यमान विद्युत् ऐनलाई परिमार्जन र एकीकृत गर्ने परिकल्पना गरिएको छ ।

निजी क्षेत्रलाई देशभित्र र बाहिर विद्युत्को व्यापार गर्न लाइसेन्स दिने प्रावधान राखेको छ । तर, विधेयक संसद्मा टुंगो लाग्न सकेको छैन । सम्बन्धित ऐन नहुँदा नेपाल विद्युत् प्राधिकरणले नयाँ विद्युत् खरिद सम्झौता गर्न नसकेको, निजी क्षेत्रले विद्युत् व्यापारको स्वीकृति लिन नसकेको र मुलुकले विद्युत् बजार विस्तार गर्न दुवै पक्ष असफल भएको छ । देशको ऊर्जा क्षेत्रमा रहेका विद्यमान समस्या समाधानका लागि नयाँ सरकारले प्रभावकारी भूमिका खेल्न अपरिहार्य छ ।

हाइड्रोजन ऊर्जाको उत्कृष्ट उपयोग :  नेपालले जलविद्युत् र हाइड्रोजन ऊर्जाको उपयोग गर्नतिर ध्यान दिनुपर्छ, जुन ऊर्जा व्यापारमा तुलनात्मक लाभ छ । हरित हाइड्रोजन पानीलाई हाइड्रोजन र अक्सिजनमा विभाजन गरी नवीकरणीय ऊर्जा र इलेक्ट्रोलाइजर भनिने प्रविधि प्रयोग गरेर उत्पादन गरिन्छ । जलविद्युत्को रूपमा नवीकरणीय ऊर्जाको प्रचुर मात्रामा भएकाले नेपाल हाइड्रोजन उत्पादनका लागि अनुकूल अवस्थामा छ ।

सार्वजनिक र निजी निकायबाट प्राप्त प्रतिवेदनअनुसार नेपालमा सन् २०३० सम्म कम्तीमा १० हजार मेगावाट जलविद्युत्को माग  हुनेछ । ०४० सम्म कुल क्षमता ३९ हजार मेगावाट हुने अपेक्षा गरिएको छ । यसरी, अतिरिक्त जलविद्युत्लाई प्रतिस्पर्धी मूल्यमा हरित हाइड्रोजन उत्पादन गर्नका लागि च्यानल गर्न सकिन्छ । ०५० सम्ममा हरित हाइड्रोजन उत्पादनको लागत प्रतिकिलोग्राम एक डलरभन्दा कम हुने अनुमान गरिएको छ ।

अतिरिक्त स्रोतको उपयोग गर्नुका साथै हरित हाइड्रोजनलाई इन्धनको प्राथमिक स्रोतको रूपमा प्रयोग गर्दा नेपालले आफ्नो आर्थिक विकासको कथालाई परिवर्तन गर्न अनुमति दिनेछ । किनकि, हरित हाइड्रोजनको व्यावसायिक प्रयोगले रासायनिक उद्योग, यातायात, ऊर्जा–सघन उद्योगहरू (फलाम र स्टिल) का साथै आवासीयजस्ता विभिन्न क्षेत्रलाई समेट्छ । यद्यपि, सम्बन्धित क्षेत्रमा हरित हाइड्रोजन ल्याउनुअघि पूर्वाधार र प्राविधिक बाधालाई ध्यान दिनु आवश्यक छ । युरियालगायत अमोनियममा आधारित मल उत्पादन गर्न रासायनिक उद्योगमा हरियो हाइड्रोजन प्रयोग गर्न सकिन्छ ।

आपूर्तिभन्दा तीन गुणा माग बढेसँगै नेपालमा रासायनिक मलको अभाव दीर्घकालीन समस्या बनेकाले आगामी दिनमा हरियो हाइड्रोजनको व्युत्पन्न रूपमा रासायनिक मल उत्पादनमा केन्द्रित हुनुपर्छ । उदाहरणका लागि तीन हजार मेगावाटको अतिरिक्त जलविद्युत्बाट करिब २१ लाख ५० हजार टन हरियो युरिया उत्पादन गर्न सकिन्छ ।

नेपालले आर्थिक वर्ष २०२१–२२ मा एक लाख ८० हजार टन अमोनियममा आधारित रासायनिक मल आयात गरेको थियो, जसमा ६० प्रतिशत युरिया हो । तसर्थ, रासायनिक उद्योगमा हरियो हाइड्रोजनको तत्काल प्रयोगले रासायनिक मलको बहुप्रतीक्षित स्वदेशी उत्पादनको थालनी गर्नेछ । साथै, नेपाल सरकारमाथिको वित्तीय भार पनि घटाउनेछ । सन् २०२१ मा सरकारले मल अनुदान कार्यक्रमका लागि १५ अर्ब रुपैयाँ विनियोजन गरेको थियो ।

हरियो हाइड्रोजनको आवासीय प्रयोग, विशेषगरी तताउन र खाना पकाउन दीर्घकालीन सम्भावना छ । आवश्यक टेक्नोलोजी अझै प्रारम्भिक चरणमा छ । हाइड्रोजनलाई घरेलु प्रयोगार्थ सम्भावित इन्धनका रूपमा परीक्षण गर्ने परियोजना विश्वव्यापी रूपमा सञ्चालनमा छन् । नेपालले पनि विश्वव्यापी प्राविधिक विकासका आधारमा घरेलु प्रयोगका लागि इन्धनको स्रोतको रूपमा हरित हाइड्रोजन प्रयोग गर्न सक्छ । प्राविधिक अवरोधबाहेक, हालको पूर्वाधार, आवासीय भवनहरू जस्तै, हाइड्रोजन अत्यधिक ज्वलनशील इन्धन भएकाले सुरक्षा चिन्ताको कारणले हाइड्रोजन प्रयोगलाई समर्थन गरिँदैन ।

जलवायु वित्त :  जलवायु परिवर्तनका प्राथमिकता र रणनीति सरकारी योजना र बजेट प्रक्रियामा समावेश भए पनि प्रत्यक्ष सरकारी लगानी निकै कम छ । कानुनी र व्यावहारिक अवरोधले प्रत्यक्ष वैदेशिक लगानी, निजी क्षेत्रको लगानी र द्विपक्षीय एवं बहुपक्षीय सहयोगमा असर पार्छ । 

आर्थिक वर्ष २०२०–२१ को मार्चसम्म ऊर्जासँग सम्बन्धित उद्योगले ५९.७ प्रतिशत लगानी प्रतिबद्धता पाए पनि वास्तविक लगानी ३५ प्रतिशत मात्रै आएको छ । जीवन्त ऊर्जा क्षेत्रमा थप विदेशी लगानी भित्र्याउन कानुनी अवरोधहरू खुकुलो पार्दै अनुकूल वातावरण सिर्जना गर्न आवश्यक छ ।

जलवायु उद्देश्य पूरा गर्न वित्तीय आवश्यकता ठूलो छ । हाल प्राथमिक जलवायु कोष सरकार, बहुपक्षीय कोष एजेन्सी र साना निजी क्षेत्रको योगदानबाट आउँछ । जलवायु बजेट २०१७–०१८ मा ३.७५ बिलियन डलरबाट २०२१–०२२ मा ४.६६ बिलियन पुगेको छ । सन् २०१० देखि नेपालले जलवायु परिवर्तनसम्बन्धी संयुक्त राष्ट्र फ्रेमवर्क कन्भेन्सनबाट मात्रै अन्तर्राष्ट्रिय जलवायु कोषमा  ३० करोड डलरभन्दा बढी प्राप्त गरेको छ ।

पछिल्लो तथ्यांकअनुसार सन् २०१५–०२० को बीचमा नेपालले अन्तर्राष्ट्रिय विकास बैंकबाट जलवायु वित्तमा २.५९ अर्ब डलर प्राप्त गरेको छ, जसमा सन् २०२० मा १.२ अर्ब डलर (समन तथा अनुकूलन कोषबाहेक) हुन आउँछ । अधिकांश स्वदेशी बैंकले स्थानीय मुद्रा ऋणमा जलविद्युत् आयोजनालाई वित्तपोषण गर्छन् । तर, ठूलो मात्रामा ऋण दिने उनीहरूको क्षमता सीमित छ । 

नेपालको ऊर्जा क्षेत्रमा सन् २०१० देखि २०१७ सम्म वार्षिक औसतमा ५२ करोड ७० लाख डलरको लगानी आएको थियो । ऊर्जा उत्पादन क्षेत्रले धेरैजसो रकम (७० प्रतिशतभन्दा बढी) प्राप्त गरेको छ । यसमध्ये लगभग सबै जलविद्युत् आयोजनामा गएको छ । जलविद्युत् उत्पादनमा लगानीका आधारमा स्थानीय स्वतन्त्र ऊर्जा उत्पादक र नेपाल विद्युत् प्राधिकरण क्रमशः दोस्रो र तेस्रो मा पर्दछन् । सन् २०१८–२०४० को अवधिमा विद्युत् क्षेत्रमा कुल २९ देखि ४६ अर्ब डलर लगानी आवश्यक पर्ने अपेक्षा गरिएको छ । ठूलो रकम भए पनि वार्षिक आवश्यकता पूरा गर्न अपर्याप्त छ ।

ऊर्जामा लगानी :  यसबाहेक, निर्यातकेन्द्रित जलविद्युत् परियोजना वार्षिक रूपमा ०.५–१.० अर्ब डलरको वृद्धिशील लगानी चाहिन्छ । धेरै आशावादी अनुमानअन्तर्गत पनि वित्तीय क्षेत्रका क्षमता सीमित छन् र थप लगानी आवश्यक छ । निर्यातमुखी परियोजनाको अन्तर्निहित अर्थशास्त्र र ऊर्जा वाणिज्यका लागि ठोस संस्थागत र नियामक वातावरणको सृजनाले राष्ट्रिय अर्थतन्त्रमा योगदान पु‍र्‍याउन लगानीको सफलता निर्धारण गर्नेछ । विकास साझेदार पहिले नै बोर्डमा छन् ।  विश्व बैंक, मिलेनियम च्यालेन्ज कोअपरेसन कम्प्याक्टका साथै भारत र चीन पनि ऊर्जा लगानीमा आकर्षित नभएका होइनन् ।

सरकारले  ऊर्जा लगानीमा गति बढाउनुपर्छ र अन्तर्राष्ट्रिय समुदायबाट थप समर्थन प्राप्त गर्नुपर्छ । साथै, अन्तर्राष्ट्रिय समुदायले यस क्षेत्रको दीर्घकालीन जलवायु लक्ष्यमा योगदान पु‍र्‍याउन सक्ने नेपालको अप्रयुक्त ऊर्जा क्षमतालाई बुझ्न जरुरी छ । आगामी वर्षमा लगातार बढ्दो विद्युत् उत्पादनको उपभोग गर्न घरेलु खपत (औद्योगिक र घरायसी) मात्र पर्याप्त हुनेछैन ।

भारत र बंगलादेशले विशेष गरी क्षेत्रीय ऊर्जा जडानलाई छलफल, प्रतिबद्धता र सहकार्यको केन्द्रमा ल्याएर यस क्षेत्रलाई ऊर्जा गरिबीबाट बाहिर निकाल्न र वातावरणीय उद्धारतर्फ औंल्याउने नेपालको प्रचुर ऊर्जा क्षमतामा चासो राखेको देखिन्छ । तसर्थ, नेपाल सरकारले ऊर्जा व्यापारलाई ध्यानमा राखी यसलाई बढावा दिनुपर्ने देखिन्छ । 

OP-EDs and Columns

Renewable energy and Nepal

– NISCHAL Dhungel* and SISIR Bhandari

Dhungel is a non-resident fellow at NIPoRe. The opinion piece originally appeared in The Kathmandu Post on 30 October 2022. Please read the original article here.

In the current context of climate change, where global movements towards renewable energy are gaining momentum, the world’s attention is shifting to doubling renewable energy resources. The world has witnessed a significant rise in the production of renewable resources from 941 terawatt hours in 1965 to 7,931 terawatt hours in 2021. In this context, Nepal, with more than 6,000 rivers and rivulets, can become a bedrock of energy security for South Asia. The country’s untapped hydropower can play a significant role in future energy supply as it is an affordable and renewable source of electricity with few environmental effects. It can significantly reduce the carbon footprints of neighbouring giants and one of the most populous countries, Bangladesh.

Nepal has declared Energy and Water Resources Decade (2018-28) to implement the Roadmap for Energy Development. Nepal has now become self-sufficient in electricity production, producing 11,064 GWh in 2022, a significant jump from 4,258 GWh in 2013. The roadmap promotes generating and using electricity, intending to increase production, consumption and national income by selling energy. With the rise in electricity output, today, 93 percent of the population has direct access to electricity. The government has aimed for 100 percent energy access by the fiscal year 2022-23.

Arun 4 (capacity 490.2 megawatts), West Seti (750 megawatts), Arun III (900 megawatts) and Lower Arun (769 megawatts) are major hydropower projects which will start distribution between 2030 and 2035. There has been increased production and export of energy and a reduction in energy imports. Where should we use this surplus energy? The ideal answer would be using it to replace traditional or non-renewable energy. Nepal has also become the first country in South Asia to participate in the Indian Energy Exchange from which it aims to expand trading in South Asia. Today, 14.1 percent of the country’s total imports consist of petroleum products which can be easily substituted by electricity. Nepal’s hydropower can convert one-third of South Asia from non-renewable to renewable energy consumption, thus reducing approximately 3.5 percent of total greenhouse gas emissions worldwide by 2040.

Nepal should focus on making the best use of hydroelectricity and possibly hydrogen energy, which has a promising comparative advantage in the energy trade. This presents an opportunity for Nepal to decarbonise the region’s major energy end-use sectors such as households (use of electric cooking stoves) and transport (battery-powered vehicles).

Climate financing

Climate change priorities and strategies are mainstreamed into government planning and budgeting procedures; however, direct government investment is significantly low. Legal and practical obstacles limit foreign direct investment, private sector investment and bilateral and multilateral support. Energy-related industries had received 59.7 percent of the investment pledges as of March of fiscal 2020-21, but actual investment came to only 35 percent. There is a need to create a favourable environment by relaxing legal obstacles to attract more foreign investment in the vibrant energy sector.

The financial requirement for meeting climate objectives is huge and needs to be better defined. Currently, the primary climate funding comes from the government, multilateral funding agencies and small private sector contributions. The climate budget has increased from $3.75 billion in 2017-18 to $4.66 billion in 2021-22. Since 2010, Nepal has received more than $300 million in international climate funds from the United Nations Framework Convention on Climate Change (UNFCC) alone. According to the most recent data, between 2015 and 2020, Nepal received over $2.59 billion in climate finance from international development banks, with $1.2 billion coming in 2020 (excluding mitigation and adaptation funds). Most domestic banks finance hydropower projects with local currency debt, but their capacity for large-scale lending is limited. Between 2017 and 2021, private independent power producers invested $400 million per year in hydropower production.

The energy sector in Nepal received investments totalling, on average, $527 million annually from 2010 to 2017. The power generation sector received most of the funds (more than 70 percent), nearly all of which went to hydropower projects. Local independent power producers and the Nepal Electricity Authority came second and third, respectively, in terms of investment in hydroelectricity generation. A total of $29-$46 billion in investments is expected to be required in the electricity sector over the period 2018-2040. Although a large sum, it is insufficient to cover the annual needs.

Energy investments

Moreover, export-focused hydropower projects would require yearly incremental investments of $0.5-$1.0 billion. Even under the most optimistic assumptions, the financial sector’s capabilities are limited and require further investment. The underlying economics of export-oriented projects and the creation of a solid institutional and regulatory environment for energy commerce will determine their success in contributing to the national economy. Development partners are already on board, note World Bank support for Nepal’s Green, Resilient and Inclusive Development approach, climate financing and the Millennium Challenge Cooperation compact (United States-Nepal partnership), and Indian and Chinese energy investments.

The government should build on the momentum and gain more support from the international community. Also, the international community should understand Nepal’s untapped energy potential that can contribute to long-term climate goals in the region. In the coming years, domestic consumption (industrial and household) alone will not be sufficient to consume the ever-increasing electricity generation. India and Bangladesh particularly seem interested in Nepal’s enormous energy potential to lift the region out of energy poverty and point it towards environmental salvation by bringing regional energy connectivity to the centre of discussion, commitments and collaborations. Energy trade can be fruitfully fostered.

SAB Blog

SAB Blog – Nepal

Domestic Updates

Nepal held local elections on 13 May. It was the second such election after Nepal went into the federal governance structure. A few results were surprising as independent candidates won top mayoral positions in major cities like Kathmandu metropolitan city (the capital) and Dharan sub-metropolitan city. Nepali Congress topped the charts among the ruling coalition of five parties, and the Communist Party of Nepal (Maoist Centre) did well to come in third. The main opposition party, the Communist Party of Nepal (United Marxist Leninist), came second though most expected the party to perform better. Nepal will also hold its federal elections later this year in November.

A Tara Air flight carrying 22 people crashed into a mountain at an altitude of about 14,500 feet. It was Nepal’s 19th plane crash in 10 years and Tara Air’s 10th fatal one during the same period. The European Union (EU) has barred Nepali airlines from European airspace since 2013 owing to poor safety records. Meanwhile, Prime Minister Sher Bahadur Deuba inaugurated Nepal’s second international airport in Lumbini, the birthplace of Gautam Buddha.

Regional Engagement

On the occasion of Buddha Jayanti (Buddha’s birth, nirvana, and death all were on the same date), Indian Prime Minister Narendra Modi visited Lumbini, the birthplace of Buddha. The visit was Modi’s fifth to Nepal, and he had visited Hindu religious sites in his four previous visits. Nepali Prime Minister Sher Bahadur Deuba and Modi witnessed the exchange of six MOUs relating to the power and education sector. One was between India’s Satluj Jal Vidyut Nigam Ltd and Nepal Electricity Authority (NEA) to develop and implement the Arun IV hydropower project. Additionally, Nepal has signed agreements to sell up to 364 MW of electricity in the open market in India.

Nepal-India relation has been hot and cold during Modi’s reign. In 2014, Modi became the first Indian prime minister to visit Nepal in 17 years and received adulation across the board. However, the Indian blockade of Nepal in 2015 and overlapping territorial claims have tested the relations. Nevertheless, the relationship has recently improved, especially in energy connectivity.

Deuba inaugurated Gautam Buddha International Airport earlier that day, but Modi chose to land on a custom-built helipad 16 kilometers away. Many analysts argue that Modi snubbed the airport because it was built by a Chinese contractor (though financed by the Asian Development Bank). Nepal has the daunting task of balancing Indian and Chinese engagement and interests in Nepal.

At the foreign secretary-level, the 14th meeting of the Nepal-China Diplomatic Consultation Mechanism took place. Both sides talked about cooperation for mutual benefits and the further promotion of bilateral ties. However, China expressed displeasure at the US Undersecretary of State for Civilian Security, Democracy and Human Rights, Uzra Zeya’s visit to Tibetan refugee camps in Kathmandu (more on this below).

Global Engagement

Zeya, the United States under secretary for civilian security, democracy, and human rights, visited two Tibetan refugee camps in Nepal. She is also the special coordinator for Tibetan issues. She went forward with visiting refugee camps despite Nepal’s reservations, though Nepal formally feigned ignorance of the visit. Nepal is home to over 13,000 Tibetan refugees and is a sensitive issue in Nepal-China relations. Nepal ascribes to the one-China policy, which states Tibet and Taiwan are integral parts of China, ever since diplomatic relations were established.

To assuage Chinese concerns, Nepal re-expressed its commitment to the One-China policy. However, the amalgamation of geopolitics and human rights principles makes Nepal’s handling of Tibetan refugees tricky. It has also been an arena for Sino-US competition in Nepal.