Bangladesh Power Development Board wants to appoint an experienced consultant for helping it in negotiations with India’s NTPC Vidyut Vyapar Nigam Limited to import hydroelectricity from Nepal.
The power board, through a letter issued on Thursday, informed the power division secretary that NVVN would soon send a draft power sales agreement to the board to export 300-500MW hydropower to be generated by India’s GMR Upper Karneli Hydropower Limited in Nepal.
‘It is necessary to examine the draft agreement and the other technical and legal matters in the trans-border electricity trade,’ according to the letter.
On April 10, during a state visit by prime minister Sheikh Hasina to New Delhi, the power board signed a memorandum of understanding with NVVN, the Indian agency which would buy electricity from GMR at Nepal-India border and sell it to the power board at India-Bangladesh border.
India enforced its new guidelines, issued in December 2016, which does not allow neighbouring countries to import electricity directly from another neighbouring country through India, said officials.
Instead, India wants to ‘facilitate’ such trans-border trade of electricity through its own agencies that will buy electricity from a neighbouring country and sell it to other neighbour under separate bilateral agreements, they said.
The power board letter also said that two power purchase/sales agreements between the power board and NVVN and that between NVVN and GMR would be finalised.
The power board also proposed a set of terms of reference for the consultant which includes finalisation of the power purchase/sales agreement between the board and NVVN and tariff structure, assumptions and pricing mechanism as per international best practices for hydropower.
The proposed ToR also includes assisting the power board in the negotiations for finalising the commercial terms and conditions of the agreement and advising the board regarding laws, guidelines and regulatory issues of India, Nepal and Bangladesh which are to be followed for importing the electricity from Nepal.
Pursuing its ‘bilateral’ negotiation policy, India issued the guideline at a time when Dhaka planned to invest in Nepal and Bhutan to build hydropower facilities there, mainly to transmit the electricity to Bangladesh through India.