Kuensel | Editorial | July 10, 2024
Hydropower is one of Bhutan’s strategic national resources and a key driver of the country’s economy. In fact, the hydropower sector has been the main source of government revenue ever since the commissioning of the Chukha Hydropower Project in 1986. The successful execution of Tala Hydropower Project in 2007 transformed Bhutan into a hydro-electricity powerhouse and net exporter of electricity. These two hydropower projects were crucial in funding our development.
Despite the early successes, Bhutan’s hydropower ambitions have faced major setbacks. In 2009, the newly elected democratic government set an ambitious target to achieve 10,000 MW of electricity by 2020 – one third of the estimated total hydropower potential of 36,900 MW.
Nearly two decades later, our total installed hydropower generation capacity stands at 2326 MW – falling significantly short of the ambitious target. We have failed quite miserably to achieve the ambitious target. Not just that, some of the mega hydropower projects that were kickstarted as part of this ambitious plan have suffered unprecedented delays and cost overruns.
A classic example of this is Punatsangchu-I Hydropower Project. Executed under a mutually beneficial bilateral agreement with India in July 2007, the Puna-I project commenced construction in November 2008. The project suffered serious setbacks when a major slide occurred on the right-bank of the dam construction site, leading to an indefinite deferral.
This landmark project, which has taken 16 years and still counting, has turned into a massive national liability. The initial project cost of Nu 35 billion has ballooned to a staggering Nu 100 billion.
Over the years, three governments have come and gone, and we are now on the fourth, yet the project is far from complete. In fact, the unforeseen geological challenges – which caused the delays and cost overruns – should have been identified and addressed during the pre-feasibility study phase. There has been a total lack of accountability.
Notwithstanding this, during the recently concluded Parliament session, the Prime Minister announced the current government’s ambitious plan to increase hydropower generation capacity by 3,119 MW over the next five years, which will take our total installed capacity to 5,500 MW. To achieve this, the government has allocated a budget of Nu 527 billion outside of the 13th Plan.
Given the scale of these hydropower projects, both in terms of budget and timeline, it is crucial that we do not repeat the same mistakes from the Puna-I project. We must learn from our mistakes and realign our hydropower strategy to ensure that we achieve the targets without any delays or cost escalations.
With economic diversification, domestic demand for electricity will inevitably increase. This necessitates scaling up our hydropower generation capacity to meet domestic needs and produce competitively priced electricity for export.
In this context, new investments in the hydropower sector are imperative. This is especially crucial for the visionary Gelephu Mindfulness City (GMC), where hydropower will be vital for its development and realisation.
The stakes couldn’t be higher. There is no room for mistakes this time.
EN 
DZ