The government of India and Bhutan have finalised the export tariff for the Punatsangchhu-II hydropower project. The price has been set at Nu 5.10 per unit, the highest tariff for a hydropower project in Bhutan so far.
The 1,020 megawatt Punatsangchhu-II hydropower project will generate around 4.5 billion units of electricity annually. It is enough to power around three million households a year. This is expected to help the country’s economy by providing a boost to the national GDP.
During lean seasons, about 20 per cent of the electricity will be used within the country, while the rest will be exported to India.
The final tariff was determined based on project and financing costs, operation and maintenance expenses, and current market conditions.
Hydropower remains important for the country’s economy, as it helps fund government budgets, public services, and infrastructure development.
However, long-term risks such as climate change, glacier melt, and sediment build up in rivers remains a concern. The government is exploring solutions like reservoirs and pumped storage to ensure the energy sector remains resilient against climate change.
Deki Lhazom
