Energy Synopsis Report 2006: Nepal

Government of Nepal
Water and Energy Commission Secretariat
Energy Synopsis Report: Nepal

2006
Report No: 7, Seq. No. 489
June, 2006
Kathmandu
Energy Sector Synopsis Report, 2006 i

FOREWARD
It is with great pleasure to bring before you all the latest information on the energy situation in
Nepal in the name of “Energy Synopsis Report 2006”. This is the seventh report in WECS
publication series of the Energy Sector Synopsis Report.
Energy is one of the basic and important infrastructures for the development. In any sector,
reliable data and documentation serve as a necessary background upon which the planning
and management of the sector depends. In this context, since 1983, the Water and Energy
Commission Secretariat has been publishing this kind of report to present the energy situation
of the country. We hope that this document will prove to be useful as an introduction and
update to the readers on the energy scene of Nepal. Further, this updated synopsis report will
prove to be of great value for the ongoing tasks of energy planning and strategy formulation
and assessment of energy sector in the past. We believe that this report will provide initial
information for the analysis of the energy implications of the energy strategies to meet the
challenges and opportunities of the future.
WECS welcomes suggestions, comments and point out errors. WECS will appreciate any
efforts towards such cooperation which will enable us to improve further publications and
updates.
Efforts made by Mr. Ram Prasad Ghimire, Energy Engineer in preparing this report are highly
appreciable. It is the hard work of collecting and compiling of various data at different times
that has make this happen. I would also like to thank Mr. Suresh Raj Uprety, Energy Planning
Director, Mr. N.M Joshi, Mr. D.L. Shrestha and Mr. Sanjaya Dhungel for their continuous
support and guidance in preparation of this report. The efforts made by Mr. Mahdav Dev
Acharya in designing the cover page and Mr. Kiran Giri for his input in the economic matters
is quite commendable.
I would also like to thank all the directors namely Mr. Rajendra Kishore Kshetri, Dr. Umesh
Nath Parajuli for reviewing this document and providing their valuable comments and
suggestions.
Finally, I hope that this report will prove useful and valuable for all those concerned in the
field of energy.
Executive Secretary
Water and Energy Commission Secretariat
Energy Sector Synopsis Report, 2006 ii

Tables of Content
Forward……………………………………………………………………………………..ii
Acronyms and Abbreviations ............................................................................... iv
1. Introduction .......................................................................................................1
1.1 Background..........................................................................................................1
2.2 Demographic Setting ...........................................................................................1
1.3 Energy and Economy ..........................................................................................2
1.4 Energy and International Cooperation.................................................................3
1.5 Energy Acts and Policies.....................................................................................4
1.6 Energy and Environment.....................................................................................5
1.7 Gender and Energy ..............................................................................................5
2.Energy Resources Base ....................................................................................7
2.1 Traditional Energy Sources .................................................................................7
2.1.1 Fuelwood .....................................................................................................7
2.1.2 Charcoal Supply ........................................................................................15
2.1.3 Agricultural Residue..................................................................................16
2.1.4 Animal Waste ............................................................................................19
2.2 Commercial Energy...........................................................................................21
2.2.1 Hydropower Resources .............................................................................21
2.2.2 Petroleum, Natural Gas and Coal ..............................................................22
2.3 Alternate Energy Resources ..............................................................................24
2.3.1 Solar...........................................................................................................24
2.3.2 Wind ..........................................................................................................26
2.3.3 Biogas…………………………………………………………………….27
2.3.4 Microhydro……………………………………………………………….28
3.Energy Consumption Scenario.........................................................................30
3.1 Consumption Pattern .........................................................................................30
3.2 Sectoral Energy Consumption...........................................................................32
3.2.1 Residential Sector Energy Consumption...................................................34
3.2.2 Industrial Sector Energy Consumption .....................................................35
3.2.3 Commercial Sector Energy Consumption .................................................36
3.2.4 Transport Sector Energy Consumption .....................................................36
3.2.5 Agriculture Sector Energy Consumption ..................................................37
4.Energy Imports and Exports.............................................................................39
4.1 Petroleum Fuels .................................................................................................39
4.2 Coal....................................................................................................................40
4.3 Electricity ..........................................................................................................41
5.Energy Prices and Markets ..............................................................................42
5.1 Market Structure and Pricing Overview............................................................42
5.1.1 Fuel-wood Market and Prices....................................................................42
5.1.2 Petroleum Fuel Prices................................................................................44
5.1.3 Electricity Prices........................................................................................45
References and Bibliography ..............................................................................48

Annexes ..............................................................................................................51
Energy Sector Synopsis Report, 2006 iii

Acronyms and Abbreviations
ADB/N Agriculture Development Bank, Nepal

AEPC Alternative Energy Promotion Center
ATF Aviation Turbine Fuel
BSP Biogas Support Program
CDR Central Development Region
DCSI Department of Cottage and Small Industries
DDC District Development Committee
DFO District Forest Office
DFRS Department of Forest Research and Survey
DM&G Department of Mines and Geology
DoFSC Department of Forest
DONPWR Department of National Park and Wildlife Reserve
EDR Eastern Development Region
FAO Food and Agricultural Organizations
FWDR Far- Western Development Region
FY Fiscal Year
GDP Gross Domestic Product
GJ Giga Joule
GWh Giga Watt Hour
HH (hh) Household
ICIMOD International Center for Integrated Mountain Development
ICS Improved Cook Stove
INGO International Non- Governmental Organization
KCAL Kilo Calories
LDO Light Diesel Oil
LPG Liquefied Petroleum Gas
LRMP Land Resources Mapping Project
MFSC Ministry of Forest and Soil Conservation
MH Micro-hydro
MHP Micro-hydro Plant
MOE&ST Ministry of Environment and Science and Technology
MPFS Master Plan for Forestry Sector
MS Motor Spirit
Mt. Metric Ton
MW Megawatt
MWDR Mid- Western Development Region
MWh Megawatt Hour
NCI Non Cultivated Inclusion
NEA Nepal Electricity Authority
NFI National Forest Inventory
NGO Non-governmental Organization
NOC Nepal Oil Corporation
Energy Sector Synopsis Report, 2006 iv
NRs Nepalese Rupees
TCE Tons of Coal Equivalent
TCN Timber Corporation of Nepal
TOE Tons of Oil Equivalent
WDR Western Development Region
WECS Water and Energy Commission Secretariat
Energy Sector Synopsis Report, 2006 v

1. Introduction
1.1 Background
Energy is a crucial input into the development process. However, the current energy
system is not sustainable in particular because of the negative effects of burning biomass
and fossil fuel. In Nepal, the huge demand for energy to facilitate economic growth and
social development is largely met with biomass fuels. In order to attain sustainable
development in the long run, dependency on this resource must be reduced gradually, in
favor of renewable energy sources. The links between energy, environment and
sustainable development present a difficult paradox to Government of Nepal. The
extension of energy services to people is the main instrument for alleviating poverty, but
burning biomass has significant negative effects on the well-being of humans and eco-
systems. This has also the impact on indoor and urban air pollution, cross-boundary
pollution and global climate change.
Energy in Nepal is derived from biomass resources, from imported fossil fuel resources,
hydropower and renewable energy resources (solar, micro-hydro and biogas). Ministry of
Water Resources is primarily responsible for the hydropower development. Ministry of
Industry, Commerce and Supplies, through public corporation like the Nepal Oil
Corporation is responsible for the supply of fossil fuels. The Ministry of Science and
Technology is taking leading role in the promotion of alternate energy primarily the
renewable energy sources through Alternative Energy Promotion Center. Ministry of
Forestry and Soil Conservation looks after the forest sector, which is the major source of
energy in Nepal. There are private entities responsible for the import of coal and also
local suppliers of lignitic coal form Dang area of Nepal. Nepal has the Energy
Perspective Plan (1991-2017) and Renewable Energy Perspective Plan (2000-2020) and
is being implemented in the energy sector.
2.2 Demographic Setting
Situated in South Asia, Nepal is a landlocked country bordered by the Tibetan Region of
China in the north and by India in the east, west and south. It is roughly rectangular in
shape with a total land area of 147,181 square km, stretching 885 Km from east to west
and between 145 to 241 Km from north to south. Topographically, the country can be
divided into three distinct regions from north to south: the mountains, the hills, and the
flat plains known as the Terai. Lying at an altitude ranging from 4,877 to 8,848 meters
above sea level, the mountainous area includes the renowned Himalaya, the world's
Energy Sector Synopsis Report, 2006 1

youngest mountain chain, with eight of the world's ten highest mountain peaks, including
Everest. The hilly region lies in the middle part of the country, with altitudes varying
between 610 meters and 4,877 meters above sea level. The Kathmandu Valley, where the
country's capital is situated, and many other scenic valleys, basins and pockets are in this
region. The Terai, which is an extension of the Gangetic plains of India, forms a low
flatland along the southern border. It comprises most of the fertile and forest areas of the
country. Due to its diverse topography, almost all the climatic zones of the earth are
found in Nepal from tropical to sub-arctic. The mean annual temperature is about 15
degrees Celsius; rainfall varies between 250 millimeters and 4000 millimeters, with about
80 percent of the precipitation occurring during the monsoon season, which typically
lasts from June until September.
Administratively, Nepal is divided in five development regions, fourteen zones and

seventy five districts. Districts and zonal boundaries are generally demarcated with
reference to watersheds and, therefore, may not necessarily fall wholly within one
physiographic zone. Each district is further subdivided into Municipalities and Village
Development Committees (VDCs) according to the level of infrastructural development.
There are all together 3992 VDCs and 58 Municipalities in the country. Each VDC are
again divided into 9 wards, while the municipalities are divided into wards ranging from
9 to 36 according to its area.
1.3 Energy and Economy
Capital, labor and energy are three primary factors that contribute to and influence
economic growth in any country in the world. Capital is the equipment, machinery,
manufacturing plants and office buildings that are necessary to produce goods and
services. Labor is the availability of the workforce to participate in the production of
goods and services. Energy is the power necessary to produce goods and services, and
transport them to their destinations. These three components are used to produce a
country's gross domestic product (GDP), the total of all output produced in the country.
Without these three inputs to production, business and industry would not be able to
transform raw materials into goods and services. Energy is the power that drives the
country's economy. In the industrialized nations, most of the equipment, machinery,
manufacturing plants and office buildings could not operate without an available supply
of energy resources such as oil, natural gas, coal or electricity. In fact, energy is such an
important component to manufacturing and production that its availability can have a
direct impact on GDP and the overall economic health.
Sometimes energy is not readily available, because the supply of a particular resource is
limited or because its price is too high. When this happens, companies often decrease
their production of goods and services, at least temporarily. On the other hand, an
increase in the availability of energy—or lower energy prices—can lead to increased
economic output by business and industry.

In Nepal too, the energy sector and its interactions with the economy represents an
important determinant for the economic policies. All economic policy and planning
initiatives have a direct and/or indirect impact on the demand for, and supply of
commercial and noncommercial energy. It can be seen from the figure 1.1 below that
though there is steady growth rate in GDP, the energy consumption growth rate is not in
par with the GDP. This may be due short in supply of the energy fuel as during this year,
Nepal has faced several energy supply problem, mainly in the commercial source of
energy.
Figure 1.1
Historical Correlation between GDP and Total Energy Consumption
600000 15000
13000
500000
11000
400000
Rs. in Million
9000
in 000 TOE
300000 7000
5000
200000
3000
100000
1000
0 -1000
2003/04*
2004/05**
1995/96
1996/97
1997/98
1998/99
1999/00
2000/01
2001/02
2002/03
Year
GDP in million Rs Energy Consumption in 000 TOE
1.4 Energy and International Cooperation
Nepal has been supported by donors’ agencies for its economic development since it
initiated five years development plan. In the energy sector too, there is no exception. The
major share of energy investment comes from donors and international NGOs. Nepal has
been receiving international assistance for a long time in hydro resources development.
Also, since early nineties, there has been huge assistance in the alternative energy sector
through various donors, namely the SNV, NORAD, DANNIDA, GTZ, KfW, World
Bank, etc. also there has been various technical assistance through UN organizations like
UNESCAP, FAO, UNDP and SAARC (SARI-E) in the software part. Recently,
BIMSTEC like organization have been established in the south Asia for the energy
security of the region.
For effective coordination and cooperation, Nepal is the member of various committees,
like World Energy Council, ICOLD etc. and WECS have been acting as the secretariat of

the Nepal Chapter of these organizations. WECS has been the focal point of various
organizations like UNESCAP, FAO and BIMSTEC.
1.5 Energy Acts and Policies
The government of Nepal has the sole responsibility for establishing the statutory, legal
and policy framework for the energy sector. A number of government departments and
agencies are involved in the policy formulation, sub-sectoral planning and project
implementation. The statutory framework, under which public and private energy supply
activities take place, is embodied in a number of Acts and Regulations approved by the
parliament. The main statutes governing energy sector activities at present include:
Forest Act, (1993)
Electricity Act, (1992)
Water Resources Act, (1993)
Hydropower Development Policy, (1992)
Soil & Watershed Conservation Act, 1982
Nepal Petroleum Act, 1983
Nepal Electricity Authority Act, 1984
Mines & Mineral Act, 1985
Industrial Enterprises Act, 1992
Environment Protection Act, 1996
Petroleum Rules, 1984
Solid Waste (Management & Resource Mobilization) Rules, 1989
Water Resources Rules, 1993
Electricity Rules, 1993
Forest Rules, 1994
Buffer Zone Management Rules, 1995
Conservation Area Management Rules, 1996
Environment Protection Rules, 1997
Various other Acts also provide the statutory authority for the different Ministries,
Commissions and Public Corporations operating in the energy sector. Also Environment
Protection Act, 1996 and Investment and Industrial Promotion Act govern activities,
which directly and indirectly affect the energy sector programs.
The government of Nepal has also introduced subsidy policy for the development and
promotion of renewable energy technology in the name of Renewable Energy Subsidy
Guidelines in 2000 B.S. Microhydro, Solar, Biogas etc. programs are provided different
subsidies through Alternative Energy Promotion Center. Similarly for the development
and promotion of Hydropower through private sector, the Government has established
Power Development Fund.

1.6 Energy and Environment
The main use of natural resources is to generate energy. Every human action intended for
energy generation alters the prevailing environment in one form or the other. There are
several ways of analyzing and understanding environmental issues and their policy
implications for energy production, supply and use.
It was during the early 80s, the government realized that sustainable and maximized
economic output of development projects can be achieved by proper due care of
environmental aspects. Realizing importance of environment, Government of Nepal has
promulgated Environment Protection Act (1996) and Environment Protection Rule 1997
First Amendment 1999. The EPR made compulsion to carry out Initial Environmental
Examination/ Environment Impact Assessment and Environmental Auditing for
development projects. According to the Act, the proponent must implement environment
management plan to minimize the likely impact of the project.
Power project that require IEE:

1. Transmission line up to 66 kV
2. Rural electrification of 1 to 6 MVA
3. Hydropower project 1 to 5 MW
Power project that require EIA:
1. Transmission line of more than 66 kV
2. Rural electrification of more than 6 MVA
3. Hydropower project of above 5 MW
4. Diesel or thermal electricity generation plant above than 1 MW
The policy of Government of Nepal on Environmental Assessment requires that the

potential environmental consequences of a project are to be considered as early as
possible in the planning and decision making process to avoid causing irreversible
environmental damage. The initial assessment process is designed to ensure that the
effects of all major projects are fully considered early is planning and designing of a
project.
Recently Nepal has entered the regime for the exchange of carbon credit as per the Kyoto
Protocol liking energy with the environment and climate change. The Government of
Nepal has given the responsibility to Ministry of Environment, Science and Technology
to acts as the Designated National Authority (DNA) for any CDM activities in Nepal.
Accordingly, Biogas Support Program has recently registered two projects comprising of
19,396 biogas plants.
1.7 Gender and Energy
The opportunities for the Nepalese women to gain from the development activities have
been hindered by illiteracy, poor health, poverty and traditionally conservative attitude
towards them. As long as women, who constitute more than 50% percent of the total

population are not fully recognized for their contributions in the development activities of
the nation, and not encouraged to participate in all phases of development, such
development will be incomplete and in the end impossible. The government of Nepal is
committed in making equal and meaningful partners in the development process. Special
provision has been made in the constitution of Nepal to make women equal from the
legal point of view and to ensure the improvement of their personnel, economic and
social development.
To mainstream the gender issues in Water and Energy related activities, WECS has
created a Women in Development Section under Social, Economic and Environment
Directorate in 1993. In 1996, this section was renamed with Gender and Development
under the same directorate. Since the, WECS has promoting the concept by
mainstreaming gender issues in its all activities, naming the few, National Water
Resources Strategy 2002 and National Water Plan 2005.

2. Energy Resources Base
Energy sources have been categorized under three broad types: (i) traditional, (ii) commercial and
(iii) alternate energy sources (alternate energy is synonymous with new, renewable, and non-
conventional forms of energy). This categorization pertains to the modality of use of the
resources in abstracting the inherent energy contents. Traditional energy sources include biomass
fuels particularly; agriculture residue and animal dung used in the traditional way - which is
direct combustion. Technological advances open up ways in which these primary energy sources
are used. Biogas and briquettes are examples of modern interventions wherein traditional energy
sources undergo transformations into "modern" types of fuels. Commercial sources of energy are
fossils fuels (coal and petroleum fuels) and electricity. Alternative energy sources include the
micro hydro, solar power, wind power, biogas, briquettes etc.
Biomass, Hydropower and Solar power are the three major indigenous energy resource bases in
the country. Also there exist some sporadic deposits of natural gases and coal reserves, which are
very small in quantity and still not exploited commercially. Though Nepal has a huge potential
of hydropower production, its exploitation has been to a very minimal and therefore it is the
biomass sector which dominates the overall energy supply and consumption.
2.1 Traditional Energy Sources
The energy sector of Nepal is characterized by excessive reliance on the traditional sources of
energy such as the , agricultural residues and animal waste. is derived mainly from the forest and
shrubland. Paddy, maize and sugarcane are the major sources of agriculture residue used for
energy purposes. Animal wastes of the livestock mainly from cattle and buffalo constitute a
significant source of energy especially for cooking and heating purposes in the domestic sector.
Nepal relies mainly on biomass fuels due to the lack of development of other energy alternatives
and overall poor condition of the nation. These sources of energy will continue to play a
dominant role in the Nepalese energy system for years to come.
2.1.1 Fuelwood
Fuelwood has become the synonym for energy, particularly in rural and residential
sectors of Nepal just because of its huge contribution in total energy system and this
situation seems to prevail for a long time to come at least for the foreseeable future.
Fuelwood comes from various sources and the role of forest area is very remarkable in
this regard. The sources of fuel wood here in the report are mainly categorized based on

the major land use types of the country as per the Master Plan for the Forestry Sector
Nepal (1988) and the Water and Energy Commission Secretariat (1988) for the
estimation of sustainable fuel wood supply from gross and accessible/reachable areas of
each land categories.
The major land use types of the country are Forest, Shrub land, Grassland, Non-cultivated
inclusions, cultivated land and other land. Other land includes the snow covered, water
bodies, cliff and wasteland. All four categories of land use types have been considered for
fuel wood production except other land types. Total sustainable supply of fuel wood from
gross and accessible/reachable areas of each land category has been assessed in the
report.
The sustainable supply of fuel wood from reachable area of all land resources type for the
year 1978/79, 1994/95, 2000/01 and 2003/04 are presented in Table 2.1. The sustainable
supply was about 6.8 million tons for the year 1978/79 as estimated by the WECS in
"District, Regional and National Forest Cover Class Summaries of the Area, Fuel wood
Yield and Wood Volume for the Kingdom of Nepal" report (1988). Annual sustainable
yield of fuel wood from per unit of land has been derived from the various forestry
research reports available at that time and same productivity factor has been used to
estimate the sustainable yield for the year 1994/95, 2000/01 and 2003/04. The sustainable
supply for the year 2003/04 was about 6.4 million tons that is only about 57% of the
gross potential supply for the same year. Sustainable supply from reachable areas in
2003/04 is about 5% and 3% less than that of sustainable supply from accessible areas of
1978/79 and reachable areas of 1994/95 respectively.
Table 2.1: Sustainable fuelwood supply from Accessible/Reachable area in Nepal

Unit in 000 tons
Fuel wood Sources 1978/79(1) 1994/95(2) 2000/01(3) 2003/04(4)
Total Forest 5,009 4,607 4,173 3,844
Shrub land 306 563 808 1,133
Grassland 52 73 71 69
NCI land 340 313 304 297
Cultivated land 1,135 1,135 1,135 1,135
Total 6,841 6,691 6,491 6,478
Source:
(1) Fuel wood supply data for the year 1978/79 has been derived from the WECS study “District, Regional
and National Forest Cover Class Summaries of the Area, Fuel wood Yield and Wood Volume for the
Kingdom of Nepal, 1988.
(2) Data for the year 1994/95 has been derived from the report "Forest Resources of Nepal, 1999,
Department of Forest Research and Survey, Nepal.
(3) & (4) Data for the year 2000/01 and 2003/04 are estimated based on above mentioned report
For this report, accessibility factor, therefore, is not used, instead reachability factor has
been adopted as mentioned in the DFRS (1999) report on National Forest Inventory,
according to which a forest area is non reachable if it is located on a slope more than
100% (45 degrees), or it is surrounded by steep slope, landslides or other physical
obstacles or protected areas (Table 2).

Due to the changes of concept, percentage of accessible forest area has increased from
about 43% to 51% as reachable one, whereas percentage of accessible area of shrub land
significantly decreased from about 64% to 52% because same reach-ability factor of
forest has been used for shrub land areas in fuelwood assessment purpose.
Table 2.2: Accessible and Reachable areas of land use type
Accessible area in Reachable area in Reachable area in

Fuel wood Sources 1978/79 1994/95 2003/04
Total Forest 43% 51% 51%
Shrub land 64% 52% 51%
Grassland 30% 45% 45%
NCI land 100% 100% 100%
Cultivated land 100% 100% 100%
Total 49% 57% 57%
Source: Data derived from the study as mentioned in the table 2.1.
According to DFRS (1999), the forest cover has decreased and shrub cover has increased
in every development region. The total forest area has been decreased by about 24%
(1.34 million ha.) during the period of 16 years from 1978/79 to 1994/95, which is
equivalent to about 1.7 percent per year in the whole country. However, annual loss of
forest in the Terai region is found slightly lower (i.e., 1.3%) than the national annual rate
which indicates the higher level of deforestation rate in hills and mountain region of
Nepal.
Shrub land has decreased from 52% to 51% from 1994/95 to 2003/04 in 10 years of
duration using the same rate of change as mentioned in DFRS, (1999) report. Shrub lands
are the degraded forest land. Above figures shows rapid degradation of forest quality in
all development region of the country. Due to this, forest area has declined to only about
63% of the 1978/79 level in 2003/04. Contrary to this, shrub land area would be nearly
four times greater in size at present than what was in the year 1978/79.
Area of the grassland and non-cultivated inclusion has been estimated reducing at an
annual rate of loss by about 0.5% which is equivalent to the rate of loss of forest and
shrub land together during the period as mentioned above. This rate is adopted for the
calculation of sustainable fuelwood supply from such land types. Beside these, few more
assumptions have been applied in connection to area calculation of land use type, which
is as follows:
• Rate of change of forest and shrub land remains the same even after the year of
National Forest Inventory, 1994.
• Reachable areas of shrub land, grassland and NCI have been assessed assuming the
same percent of reachable area of forest found in every development region of the
country.
• Reach-ability factor of the land use types are first calculated at the regional level and
then aggregated to find the national figure.

The important assumption here in the assessment of sustainable fuel wood supply from
gross and reachable/accessible areas is based on implementation of prescribed
management system of the forest. This type of supply assessment is, therefore, useless
and has no sense if the forest resources are not managed scientifically. However, this
estimation of sustainable fuel wood supply is very much useful in planning exercise and
it is senseless unless the fuel wood is produced in accordance with prescribed
management system. It is very difficult to manage such land resources scientifically.
However, community forest area and private woodlots can be assumed as the
scientifically managed areas in terms of wood production. In general, wood products
from natural forest area of Nepal are being extracted without applying any management
scheme. This study uses the same productivity factor of each land use type what was
mentioned in the WECS (1987) report on Fuel Wood Supply in the District of Nepal as
presented in Table 2.3. Furthermore, this study doesn't include the supply of fuel wood
from such land resources which are converted from forest, grassland and NCI.
It has been widely observed that Nepal's cultivated land is being expanded due to the
conversion of land mainly from forest, shrub land, grassland, NCI and even other land
types. However, it is very difficult to find how much of the lands are being converted
from one to another because it is very complex to find the rate of conversion. No such
types of comprehensive study are found. However, it is widely found that once the other
land use types losses there is greater chance of expanding the area of cultivated land.
Sustainable supply potential of fuelwood in Nepal in this study has been assessed with
some assumptions as mentioned below. Basis for the assessment is WECS previous
report namely the Fuel Wood Supply in the District of Nepal (1987) and District,
Regional and National Forest Cover Class Summaries of the Area, Fuel wood Yield and
Wood Volume for the Kingdom of Nepal (1988). However, accessibility factor used in
that report has been changed and replaced by reachability factor for assessing the
potential supply of fuelwood.
Table 2.3: Sustainable Yield of fuelwood from land use types in Nepal
Fuel wood Sources Yield (tons/ha.) Remarks

Forest 2.1 Average of the Development Region
Shrub land 0.69 National Average
Grassland 0.10 National Average
NCI land 0. 69 National Average
Cultivated land 3.50 National Average
Source:
1. WECS, 1987. District, Regional and National Forest Cover Classes Summary of the Area, Fuel wood
Yield and Wood Volume for the Kingdom of Nepal.
2. WECS, 1988. Fuelwood supply in the districts of Nepal.
Assumptions:
• Same yield factor have been used as used by the WECS (1988) report on " District, Regional and
National Forest Cover Classes Summary of the Area, Fuel wood Yield and Wood Volume for the
Kingdom of Nepal, 1988" to assess the total fuel wood supply from each type of land resources while

each type of land resources areas have been calculated based on data found in the LRMP report
(1978/79) and DFRS (1999) report on National Forest Inventory.
• Supply potential of fuel wood from cultivated land remains the same as it was in the year 1978/79.
• Same reachability factor for forest area, found in the DFRS (1999) report, has been used to shrub land
and grassland areas, while reach-ability factor for the NCI and cultivated land remains the same (i.e.,
100%).
• Sustainable supply potential of for the year 1978/79 is calculated based on accessible areas of the land
resources, whereas supply for the rest of the year (i.e., from 1979/80 to 2003/04/05) are calculated
based on reachable areas of the land resources as indicated in DFRS (1999) report .
Fuel Wood Supply by Sources
As mentioned, forest are the major sources of in Nepal which contribute currently about
60% in total primary energy supply from reachable area and its contribution is gradually
decreasing over time. Significant change can be found in the shrub land supply whose
contribution increased from 4% in 1978/79 to about 8% in 1994/95, 12% in 2000/01 and
17% in 2003/04. This is mainly because of increase in the area of shrub land by about
114% during the 10 years period of 1994/95 to 2003/04.
Table 2.4 : Condition of Land resources by Landuse type for Sustainable Supply potential
of fuel\wood in Nepal
Fuel wood Sources 1978/79 1994/95 2000/01 2003/04
Total Forest 73.22% 68.86% 64.29% 59.34%
Shrub land 4.47% 8.42% 12.45% 17.49%
Grassland 0.76% 1.09% 1.09% 1.07%
NCI land 4.96% 4.69% 4.69% 4.58%
Cultivated land 16.59% 16.96% 17.48% 17.52%
Total 100.00% 100.00% 100.00% 100.00%
Source: Figure derived from the study as mentioned in Table 2.1
No significant difference can be observed in the contribution of different landuse types in

the supply of woodfuels in the past years except forest and shrub land. In total, gross
supply potential has been decreased by about 18% during 27 years from 78/79 to 04/05
while supply from accessible area to reachable area decreased only by about 5% during
the same period.
Sources of fuelwood supply are generally categorized broadly into two types. One is the
off-farm source and another is the on-farm. The supply from cultivated land is termed as
on-farm and supply from other landuse types is known as off-farm. Contribution of off-
farm supply in the total potential of fuel wood from reachable area is far higher than that
of on-farm supply. Only about 18% of the total sustainable supply comes from on-farm
and its contribution remains almost same since 1978/79. It indicates that Nepalese rural
farmers keep low level of tree growing areas within their cultivated land. It seems that the
contribution of off-farm resources for fuel wood supply will be more or less same for a
long time to come until some radical changes occur in the energy supply system of the
country.

Fuelwood Supply Potential by Physiographic Region
Nepal's physiographic regions are broadly divided into three types namely Terai, Hills
and Mountain. In terms of fuelwood supply, Terai alone produces about one fifth of the
total supply and the remaining amount comes from Hills and Mountain. Figure 2.1
provides the information about the contribution of each physiographic region by land-use
types.
Figure 2.1: Sustainable Fuelwood Production by Physiographic Region in Nepal, 2004

Sustainable fuelwood Production by Physiographic Region in Nepal,
Year 2004
(Total supply 6.47 million tons)
70.00%
60.00%
Percentage 50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
Forest Shrubland Grassland NCI land Cultivated land
Terai 59.77% 0.46% 0.31% 4.14% 35.33%
Hills 57.53% 19.83% 0.37% 6.14% 16.12%
Mountain 62.75% 25.91% 3.10% 1.67% 6.57%
Forest area nearly contributes equally in all physiographic regions in total supply system.
High variation is found in contribution of shrub land and cultivated land in different
regions. A quarter of the total supply in mountain region comes from the shrub land
alone whereas its contribution is around 20% in hills. On the other side, importance of
cultivated land in Terai region for fuel wood supply is high, which is nearly one third of
the total. Contribution of cultivated land gradually decreases as altitude increases. It
indicates intense practice of tree growing and larger area of cultivated land in the Terai
region.
Fuelwood Supply Situation in Development Regions
Figure 2.2 shows the sustainable supply potential of fuelwood by development region and
source type, according to which fuelwood production in the development regions varies
from 14% in WDR to 26% in EDR of the total supply. Like in the physiographic regions,
contribution of each land use categories in all development regions seems to be similar to
a great extent. It simply indicates the proportional distribution of land use in each
development regions of the country. The supply is dominated by forest areas followed by

shrub land, NCI and grassland respectively in all regions. However, cultivated land in
CDR, EDR and WDR is the second largest source of fuel wood supply where this land is
third largest source of supply in the case of the FWDR and MWDR.
Figure 2.2: Sustainable Fuel Wood Production by Development Region in Nepal, 2004
Sustainable Fuelwood Production by Dev.Region in Nepal, Year 2004

Total sustainable supply 6.47 million tons
80.00%
70.00%
60.00%
50.00%
Percent
40.00%
30.00%
20.00%
10.00%
0.00%
FWDR MWDR WDR CDR EDR
Forest 58.99% 52.11% 52.68% 70.61% 58.94%
Shrubland 24.81% 27.97% 10.86% 6.41% 17.88%
Grassland 0.93% 1.94% 1.52% 0.48% 0.72%
NCI land 3.14% 3.64% 7.57% 4.98% 4.29%
Cultivated land 12.12% 14.33% 27.38% 17.52% 18.17%
Total Potential Supply equal to 6.47 million tons.
On-Farm Fuelwood Supply
Fuelwood derived from cultivated lands are here termed as the On-Farm fuelwood
supplies which currently contributes about 18% of the total sustainable supply in Nepal.
Proportion of the non-cultivated land within the cultivated land of private farm in each
development region is the significant factor to estimate on-farm fuel wood production. A
detail of the on-farm fuel wood supply by development region and physiographic region
is presented in Table 2.5 below. At national level, about 11% of the cultivated land is
assumed to be remained as non-cultivated land to grow primarily for trees/wood lots. The
region wise proportion of non-cultivated land within the category of cultivated land is
also presented in table 2.5. This non-cultivated area factor for each development region

and factor for fuel wood production is used to estimate the on farm production and supply
potential as practiced in the WECS.
Table 2.5: Sustainable supply potential of fuelwood from On-farm Areas, 2003/04
Unit in 000 MT
Non Cultivate Area Physiographic Region
Development Region
in Cultivated Land Terai Hills Mountain
FWDR 12.42% 46 66 16
MWDR 12.13% 42 111 39
WDR 11.83% 86 141 19
CDR 9.42% 125 124 11
EDR 10.50% 162 122 24
Nepal 10.92% 461 564 110
Sources: Estimation based on WECS (1987) report on Fuel wood supply in the district of Nepal.
According to the use of above factor for estimation of fuelwood supply in Nepal, about
10 million tons of fuelwood was found deficit in the country. Deficit situation is most
severe in the Terai region where sustainable supply can only meet about 19% of the total
fuelwood demand. Fuelwood demand, in terms of volume, in the Terai region is very
high compared to other region. The reasons being a larger population and higher
economic activities in the areas. It clearly indicates that the fuel wood requirement in the
Terai as well as in other densely populated regions are being met by over-cutting of tree
resources than the sustainable supply limit of both forests as well as on-farm areas.
Hills and Mountain region are able to meet their fuelwood demand of by about 57% and
78% respectively. In all three physiographic regions, contribution of off farm areas is
quite high in supplying the fuelwood; however their contribution varies greatly from one
region to another.
Estimation of supply demand situation of fuelwood in the country is a huge task. This
report has estimated both supply and demand figures with some assumptions however,
situations could be influenced by various factors and such factors could be highly
dynamic. Therefore, the estimated figures could vary greatly from one situation to
another and from one year to another as well. Hence, this figure can be taken as an
indicative one, which can be mostly used for planning and policy level decision making.
Like in the physiographic regions, all development regions are also facing a similar
problem in balance situation. CDR exists in highly imbalance situation followed by
WDR, MWDR, FWDR and EDR respectively. Deficit fuel wood ranges from 1107
thousand tons in EDR to 3591 thousand tons in CDR.
Once the supply is found less than its demand, then users start to change their strategy in
energy resource use. High imbalance situation in Terai region may indicate high use of
agricultural residues and animal waste as well as biogas technology.

Table 3.5 Fuelwood Balance in Nepal, 2003/04 Unit in 000 tons
Physiographic Region Development Region
Sources
Terai Hills Mountain FWDR MWDR WDR CDR EDR Total
Off-Farm
Supply 844 2935 1565 924 1152 651 1228 1388 5343
On Farm
Supply 461 564 110 127 193 245 261 308 1135
Total Supply 1305 3499 1675 1051 1344 896 1489 1696 6478
Total Demand 7889 6562 2318 2293 3023 3570 5080 2803 16769
- - -
Balance 6584 -3063 -643 -1242 -1679 2674 -3591 1107 -10291
Source: Estimates and projection
The highly imbalanced situation, especially due to the higher consumption than
sustainable supply found in Nepal, could mean higher estimate for demand or lower
estimate for supply or both. If shortage takes place, this will not mean that the
consumption will exceed the supply, but this could indicate a lower consumption than it
would normally be. On the other hand, if the supply is more, then consumption would be
close to potential supply as well. Once the consumers face the fuel wood scarcity
situation, they start to respond to it in several ways. For example, when users need to
spend more time and money on fuel wood, they will try to use less by minimizing wastes,
using better devices, changing habits and operational practices or switching to other fuel
(Heap et al, 1993).
2.1.2 Charcoal Supply
Charcoal also is a form of wood fuel which is directly derived from the burning of wood
components. Its business in Nepal is still illegal and no one legally produce charcoal for
commercial purpose. Some sort of illegal trade of charcoal can be found between
traditional producer and commercial/industrial users at small scale. Charcoal production
at industrial scale doesn't exist until now though some efforts were made to produce it at
small-scale business to promote commercial charcoal production by some forestry
development project in the past.
Charcoal uses in Nepal are found since immemorial. Its uses are generally found in
commercial sector mostly in restaurant, goldsmiths, blacksmiths, metal crafters and clay
producers. Industry is the second largest area of charcoal consuming in Nepal. Some
amount of charcoal is also used in the residential sector particularly for space heating.
Lack of data regarding the consumption of charcoal particularly in the residential sector
has become a problem because households generally do not report this type of fuel
source.
The importance of charcoal is quite high in the present context since the transportation of
fuel wood in the city centers from the distance parts of the country is very expensive
more than the cost of carrying the energy value from charcoal. However, charcoal supply
practices in Nepal are very limited and illegal. Whatever charcoal is presently available in
local urban shops, particularly in the Kathmandu valley has been brought illegally mainly

by the rural inhabitants of the surrounding hills. On the other hand, the quality of such
charcoal is also very poor.
In the past, the Sagarnath Forestry Development Project and the Fuel Wood Corporation
had tried to produce charcoal commercially in an experimental basis. Fuel Wood
Corporation attempted to produce charcoal in the Bardia District during 1985/86 using
traditional methods of carbonization using the hardwood waste generated from forest
harvesting and logging. It produced about 1000 tons of charcoal over a three months
period but stopped the production due to marketing problem. Sagarnath Project also tried
to produce charcoal from logging waste such as stumps, lops and tops etc. in the project
area. However, it was not successful due to variety of reasons, one of which was the
difficulty in product marketing.
2.1.3 Agricultural Residue
The third largest indigenous biomass source of energy is agricultural residues in Nepal
which directly come from the agricultural crops. Two types of residues are generally
considered for energy purpose, one is field residue generated during the crop harvesting
and another is process residue derived as the bi product during the agro processing.
Residues collected at the field just after harvesting the main crops are named with field
residues. Residues coming from agro-processing are called process residues such as rice
husk, maize cob, wheat barn etc. This report is confined only to the estimates of the field
residue. Report also considers only the major crop types of the country for residues
production estimation. Technical potential of agricultural residue production in Nepal is
presented in table 2.6
Table 2.6: Potential production of Agricultural Residue, 2003/04

Unit in 000 tons
Crop type Theoretical Potential Technical Potential Contribution of crop types
Grain legumes 452 226 1.5%
Jute 11 11 0.1%
Maize 6732 6287 41.2%
Oil seed 409 205 1.3%
Paddy 8062 5121 33.6%
Sugarcane 1245 1245 8.2%
Wheat 2556 2168 14.2%
Grand Total 19468 15263 100.0%
Sources:
1. Crop production data from MOAC (2004) report on Statistical Information on Nepalese Agriculture.
2. Residue to Product Ratio (RPR) factor from WECS (2000) report on Estimation of Agricultural and
Animal Waste in Nepal.
3. Theoretical and Technical potential of crop waste is estimated figure based on above mentioned reports.
Supply potential of agricultural residues is estimated at 19.5 million tons for the year
2003/04 in Nepal. This amount is equivalent to 244 million GJ in terms of energy that
becomes about 67% of the total energy consumption for the same year. It is therefore
indicative that more than two thirds of the total energy requirement of the country can be

supplied solely from agricultural residues while considering the heating value of the
resources. This report also considers the fodder ratio of the agricultural residues. The
technical supply potential of agricultural residue is 15.2 million tons, nearly 80% of the
total potential, while considering the fodder ratio of the crop residues which will not be
available for energy.
These estimates were made from different sources specially the WECS (2000) report on
Estimation of Agricultural Residues and Animal Waste in Nepal, and the paper on
Agricultural and Forest Residues: Generation, Utilization and Availability (Koopmans
and Koppejan, 1997).
Residue-to-Product-Ratios (RPR) values have been used with care while assessing the
resource potential for crop residues. Actual values of RPR vary widely depending on
local conditions, crop species and moisture content. Generated residues may not be
available for energy purpose because they may be already in use for other purposes such
as fodder and compost manure or they may be too far away from the potential users.
Residue to Product Ratio (RPR) and fodder to crop ratio (FCR) of major crop types are
different. Fodder to crop ratio of paddy crop is very high compared to other crop types. It
is because paddy stalk is the major feed source for domestic animals in Nepal. And this
fodder ratio can vary from place to place and time to time as well. Jute has been
considered as the zero value of fodder for domestic animals while estimating the crop
residues. Because of lack of data, the fodder ratio of oil seed crops and grain legume is
assumed to be equal to the half of its RPR value.
Supply Potential of Agricultural Residue by Development Region
Figure 2.3 shows how the supply potential of agricultural residues varies from one
development region to another. This comparison is important in Nepal to show how the
level of economic activities affect in biomass energy consumption and supply as well.
Largest amount of residue is produced in the CDR followed by EDR, WDR, MWDR and
FWDR respectively. This is also proportional to the size of agricultural land in each
region. Composition of residue production by crop types varies from one region to
another. Production of maize and paddy residue occupies more than three forth of the
total potential and contribution from maize alone is more than 40% in all regions. Paddy
and maize crops are therefore not only important from food security point of view but
also important from energy security perspective.

Figure 2.3: Supply Potential of Agricultural Residues in Various Development Regions, 2004
Proportion of production by crops

35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
CDR EDR FWDR MWDR WDR
Wheat 4.8% 2.5% 1.6% 2.3% 3.0%

Sugarcane 3.7% 0.7% 1.0% 0.3% 2.5%
Paddy 10.2% 11.1% 2.7% 3.2% 6.3%
Oil seed 0.5% 0.2% 0.2% 0.3% 0.2%
Maize 12.2% 10.0% 2.0% 7.1% 10.0%
Jute 0.0% 0.1% 0.0% 0.0% 0.0%
Grain legumes 0.6% 0.3% 0.1% 0.3% 0.2%
Development regions
Total Potential Supply = 15.26 million tones

Source: Estimates
Residue Production by Physiographic Region
Terai is the basket of food production in Nepal. This region is rich in both productivity
and accessibility terms. Figure 2.4 shows the potential of crop residue production by
physiographic regions. More than half of the residue production comes from Terai alone
and contribution of Mountain region is very low in this regard. This ratio seems to be
very similar to the distribution of population by physiographic region. Around 80% of the
residues in Hills and Mountain region come from maize, while paddy is the largest source
of residue in Terai. Supply potential alone does not tell much if the intervention is
necessary to manage this resource for multiple uses.
Supply-Demand Balance of Agricultural Residue
About 1.1 million tons of agricultural residues are recently being consumed in residential
and industrial sector for energy purpose. This is only about 5% of the total potential
without considering the fodder value. Therefore, there seems huge potentiality of using
agricultural residues for energy use. However, alternative use of residues has to be taken
care of because they are mostly used for fodder and compost manure preparation which
are the pillars of subsistence agriculture in Nepal.

Agricultural residues are among the poorest form of energy and people therefore don't
use it until woody forms of biomass, especially the fuel woods are available. These
resources are often used together with other woody form of biomass in the same energy
using devices mostly as an igniting agent.
Figure 2.4: Supply Potential of Residue by Physiographic Region, 2004

60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
Hills MNT Terai
Wheat 4.6% 0.8% 8.9%

Sugarcane 0.1% 0.0% 8.0%
Paddy 7.5% 0.9% 25.2%
Oil seed 0.3% 0.0% 1.0%
Maize 28.3% 4.0% 8.9%
Jute 0.0% 0.0% 0.1%
Grain legumes 0.3% 0.0% 1.1%

Source:
1. Crop production data from MOAC (2005) report on Statistical Information on Nepalese Agriculture.
2. Residue to Product Ratio (RPR) factor from WECS (2000) report on Estimation of Agricultural residues
and Animal Waste in Nepal.
3. Theoretical and Technical potential of crop waste production are estimated based on above mentioned
reports.
2.1.4 Animal Waste

Animal waste particularly dung is not only the second largest source of indigenous
energy but it also occupies the second largest position in consumption terms. Dung cakes
are the poorest form of energy and are regarded as the energy of the poor. However, if
animal waste in the form of dung is used in a biogas plant, it turns into a clean form of
energy without any adverse effects to the environment and agricultural production. Here
only the supply potential of animal waste as the dung cake is estimated, though it is
possible to estimate the potential supply of dung for biogas generation which has been
already going popularity in Nepal.
People mix animal dung with small pieces of agricultural waste and woody biomass to
make dry and rigid form of dung cakes. This form of dung cake is common in the rural

parts of the Terai region where natural forest does not exist in nearby areas. Like
agricultural residues, it also has multiple implications in rural livelihood.
Table 2.7: Supply Potential of Animal Waste, 2004/05

Unit in 000 tons
Animal Population Dung production in Tonne (dry) Dung Collection Availabilt Dung for
in Tonnes @ y as Fuel in
Dev. Reg. Phy. Reg. Cattles Buffoloes Cattles Buffoloes Total 60% Energy tonnes
Mountains 209688 112581 230656.8 151984.35 382641.15 229585 0 0
Hill 721649 336806 793813.9 454688.1 1248502 749101 0.5 374551
EDR
Terai 1001423 452595 1101565.3 611003.25 1712568.6 1027541 1 1027541
Total 1932760 901982 2126036 1217675.7 3343711.7 2006227 1402091.7
Mountains 202863 99385 223149.3 134169.75 357319.05 214391 0 0
Hill 729052 561347 801957.2 757818.45 1559775.7 935865 0.5 467933
CDR
Terai 675398 379959 742937.8 512944.65 1255882.5 753529 1 753529
Total 1607313 1040691 1768044.3 1404932.9 3172977.2 1903786 1221462.2
Mountains 10541 82 11595.1 110.7 11705.8 7023 0 0
Hill 780166 850739 858182.6 1148497.7 2006680.3 1204008 0.5 602004
WDR
Terai 434737 260375 478210.7 351506.25 829716.95 497830 1 497830
Total 1225444 1111196 1347988.4 1500114.6 2848103 1708862 1099834.2
Mountains 201436 31183 221579.6 42097.05 263676.65 158206 0 0
Hill 691159 277872 760274.9 375127.2 1135402.1 681241 0.5 340621
MWDR
Terai 400405 243088 440445.5 328168.8 768614.3 461169 1 461169
Total 1293000 552143 1422300 745393.05 2167693.1 1300616 801789.21
Mountains 243995 106325 268394.5 143538.75 411933.25 247160 0 0
Hill 344522 173731 378974.2 234536.85 613511.05 368107 0.5 184053
FWDR
Terai 347429 195395 382171.9 263783.25 645955.15 387573 1 387573
Total 935946 475451 1029540.6 641858.85 1671399.5 1002840 571626.41
Mountains 868523 349556 955375.3 471900.6 1427275.9 856366 0 0
Hill 3266548 2200495 3593202.8 2970668.3 6563871.1 3938323 0.5 1969161
Nepal
Terai 2859392 1531412 3145331.2 2067406.2 5212737.4 3127642 1 3127642
Total 6994463 4081463 7693909.3 5509975.1 13203884 7922331 5096803.8
Sources:
1. Animal number data from MOAC (2005) report on Statistical Information on Nepalese Agriculture.
2. Dung production from per unit of animal per year data from WECS (1997) report.
3. Potential production of animal waste is estimated figure based on above mentioned reports.
Table 2.7 shows the total supply potential of animal waste for the year 2004/05 that can
be used either in the form of dung cake to produce energy or in the form of compost
manure to use in agriculture land. Figure 2.5 presents the proportional distribution of
dung production by development and physiographic region. Contribution of buffalo and
cattle in the total potential of dry dung cake production was about 45% and 55%
respectively for the same year.
The potentiality of producing biogas is about 1.9 million plants out of which 57% in terai,
43% in hills and mountains. The Biogas Support Programme (BSP) under the Alternative
Energy Promotion Center and with the cooperation from various donors like SNV and
KfW is promoting the installation of biogas plant in various part of the country.

Figure 2.5: Supply Assessment of Animal Dung, 2004
30%
Contribution in percentage
25%
20%
15%
10%
5%
0%
CDR EDR FWDR MWDR WDR
Terai 9% 13% 5% 6% 6%
MNT 3% 3% 3% 2% 0%
Hills 11% 9% 5% 9% 15%
Development regions
About 24% of the total energy requirement of the country can be met by animal dung
alone if used only for energy purpose. It is important to note here that about 20% of the
total potential of dung production has already been used for energy purpose, which can
be a matter of serious concern for subsistence agricultural system of rural Nepal because
subsistence oriented farming system of Nepal heavily depends on animal dung for
agricultural productivity.
2.2 Commercial Energy

Commercial energy sources in use are petroleum fuels (kerosene, LPG, motor spirit, diesel,
aviation fuel and fuel oil), coal and electricity. Of these only hydro-electricity is indigenously
produced.
2.2.1 Hydropower Resources
Nepal is a country with enormous water resources. It is estimated that the rivers flowing from
Nepal contribute about 71% of the dry season flow and 41% of the total annual average flow of
the Ganges. The annual average run-off within the Nepalese territory is estimated at 174 billion
cubic meters. The change in elevation from the high Himalayas in the North to the plains in the
South over a short width of 150 to 230 km generates substantial hydraulic head for development
of hydropower. Hydropower in Nepal is used in two forms – mechanical and electrical. The
practice of using hydropower in the form of mechanical energy through traditional water wheels
(locally called Ghattas) goes back to time immemorial.

Nepal's hydropower potential has been estimated at 83,000 MW based on average river flow
(Shrestha, H.M., 1966). The details are shown in Table 2.8. A number of studies aimed at gathering
the knowledge of potential endowment of the resources have been carried out (Shrestha, H.M., 1966,
1994, WRSF, 2002). The studies conducted so far have identified 122 projects. Among these projects
there are 27 projects, which could be developed with storage reservoirs for multipurpose use for
hydropower, irrigation, flood control and inland navigation. The total potential in terms of installed
capacity and annual energy of these identified projects are respectively 43,000 MW and 180,000
GWh. Of these projects, 23 projects have already been studied at least to pre-feasibility level. These
feasible projects have total installed capacity of 14,740 MW and can produce 43,000 GWh of energy
per year.
Hydropower utilization is currently about 1.5% of the proven potential. The total installed electricity
generation is about 613.5 MW out of which hydroelectric generation capacity is around 557 MW.
Of this total generation of electricity, 603 MW are hooked to the national grid, and the remaining are
in isolated system comprising 40 small/mini hydro plants, about 2000 micro-hydro and about 1200
peltric sets serving remote areas of the country.
Table 2.8: Theoretical Hydropower potential (in 1000 MW)

River Basin Major River with catchments Small River courses with small Total
area above 1000 sq. km. catchments area
Sapta Koshi 18.75 3.6 22.35
Sapta Gandaki 17.95 2.7 20.65
Karnali& Mahakali 32.68 3.5 36.18
Southern Rivers 3.07 1.04 4.11
Total 72.45 10.84 83.29
Source: Shrestha, H.M., 1966
There are provisions of power exchange between Nepal and India through specified points along the
border and in quantities limited in accordance with Power Exchange Agreements between Nepal and
India. The maximum quantity under the terms of the Agreement has been currently set at 150 MW.
2.2.2 Petroleum, Natural Gas and Coal
Though lot of exploration works had been carried out, no proven reserves of petroleum suitable
for commercial exploitation have been found in Nepal. All the petroleum products consumed in
Nepal are imported from India or overseas in the refined form for direct consumption. Nepal Oil
Corporation (NOC) is the sole organization responsible for the import and distribution of
petroleum products. The NOC has the storage facility for all the essential petroleum fuel, except
for the LPG. LPG is bottled and distributed by the private companies around all the parts of the
country. Fig 2.6 provides the historical trend of petroleum fuel imported from India and abroad.
Exploration work has found out three potential sites for natural gas in Kathmandu Valley. 47.6
million m3 of proven reserve have only been identified in one of the sites and further explorations
are being carried out to prove the deposits in other two. So far the probable reserves identified in
these two deposits are around 270 million m3. These deposits if commercially extracted will not
be sufficient to last for a few decades.

Fig 2.6: Import of Different Petroleum Fuel at Different Years
Import of Different Petroleum Products by year

Data for 2062/63 provisional
400,000
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
2050/51
2051/52
2052/53
2053/54
2054/55
2055/56
2056/57
2057/58
2058/59
2059/60
2060/61
2061/62
2062/63
Year
MS (KL) Deisel (KL) Kerosene (KL) LPG (MT) ATF (KL)
Source: Nepal Oil Corporation
There are some small occurrence of coal and lignite in Nepal, which are not commercially
attractive. The occurrences of coal can be classified in to four major categories:
Quaternary lignite of Kathmandu Valley

Coal from Dang (Eocene coal from Mid-Western Nepal)
Siwalik coal
Gondwana coal
Out of these four types identified, the Quaternary lignite deposit of the Kathmandu Valley and
coal from Mid-Western Nepal are of some economic significance. The Siwalik coals though
widely distributed throughout the Siwalik range of the country are by small and sporadic and
have not been commercially exploited. Likewise the Gondwana coal from the east of Nepal is of
low quality and small in size and is of no economic significance.
There are some open pit mining practices in the Dang area for the extraction of lignitic coal. The
primary production of this coal is about ten thousand tones, which are mainly used in the brick
manufacturing industries. Also Nepal import from India through private organizations under the
agreement with Coal India Limited. In the year 2004/05 Nepal imported about 280 thousand tons
from India. Kathmandu alone consumes about 40% of the imported coal. It is mainly used in the
industrial sector like cement, lime, and brick industries in Nepal. Fig 2.7 presents the time series
status of coal production and import in Nepal.

Fig: 2.7: Sources of Coal from Different Source by Year.
Supply of Coal from different Sources by Year
450
400
350
300
in 000 Mt
250
200
150
100
50
0
2050/51 2051/52 2052/53 2053/54 2054/55 2055/56 2056/57 2057/58 2058/59 2059/60 2060/61 2061/62 2062/63
Year
Primary Production Import Total
Source: Department of Customs and Department of Mines and Geology.
2.3 Alternate Energy Resources
The country’s economy does not provide enough economic bases for large scale investment for
the exploitation of hydro potentials and laying transmission and distribution network in the rural
areas in the immediate future. Alternative energy like, solar, microhydro, wind and biogas can
play a catalyst in rural development by providing modern form of energy. It can effectively;
help in reducing drudgery of the rural population, especially the women and the children
by cutting down the time required to collect and use traditional form of energy and can
also reduce the indoor air pollution.
Combat the environmental implications of GHG reduction, forest depletion, etc.
Save convertible currency by substituting imported fossil fuels.
Be exploited at different scales and sizes to suit the local needs.
Provide modern forms of energy like electricity even in the remote locations.
2.3.1 Solar
Nepal, being located in favorable latitude, receives ample solar radiation. The average solar
radiation varies from 3.6 –6.2 kWh/m2/day, and the sun shines for about 300 days a year. The
development of solar energy technology is thus reasonably favorable in many parts of the
country. Average daily insolation in Nepal in kWh/m2 is given in the Table 2.9 for six different
locations.

Table 2.9: Average daily Insolation in some location of Nepal in kWh/m2
Location Jan Feb Mar Apr May June Jul Aug Sep Oct Nov Dec Avg.
Dadeldhura 3.35 4.14 4.88 5.82 6.04 4.63 4.0 3.90 4.04 4.26 3.79 3.28 4.34
Dhangadi 3.79 4.6 5.56 6.52 6.64 4.99 5.91 4.72 4.12 4.40 4.19 3.70 4.93
Pokhara 3.55 4.34 5.08 5.56 4.99 4.36 4.18 3.90 4.07 4.15 3.93 3.48 4.3
Butwal 3.81 4.69 5.52 6.32 6.33 4.79 4.72 4.37 4.04 4.42 4.14 3.71 4.73
Taplejung 3.7 4.34 4.84 5.41 5.41 4.04 3.99 3.85 3.88 4.02 3.94 3.57 4.24
Biratnagar 4.0 4.79 5.69 6.22 6.08 5.08 4.65 4.61 4.44 4.63 4.29 3.82 4.86
Source: Adapted from Peter Ahm, Paper presented on RETRUD, 1998
Similar data are available for about 35 locations providing adequate basis for design of solar
technology applications. These figures also emphasize high solar energy potential and
possibilities of development of solar energy technology.
Solar Passive Collectors
Solar energy is traditionally used for drying crops, clothes, fuelwood, crop residues etc. The
technological interventions started only in the sixties with the production of domestic solar water
heaters. The use of solar water heaters are mainly in the urban centers and in the trekking route. It
is mainly clustered in the Kathmandu Valley. Till 2005, there are around 61,000 solar water
heaters installed in the country.
Solar Photovoltaic Systems
The use of solar photovoltaic is increasing rapidly in the country after the provision of subsidy by
the Government of Nepal. This technology for electricity generation has been widely used for in
households, telecommunications, airports etc. Table 2.10 gives the status of Solar home systems
installed at different years. Also the fig. 2.8 illustrates the growth pattern of Solar home systems.
Table 2.10: Status of Solar Home System in Nepal

Installed Cummalitive
Sl. Nos. of Cummulative
Year Capacity Capacity
No. Installations Nos.
KWp KWp
1 1992 8 8 0.3 0.3
2 1993 89 97 3.3 3.6
3 1994 36 133 1.2 4.8
4 1995 149 282 4.9 9.7
5 1996 562 844 20.4 30.1
6 1997 736 1580 27.4 57.5
7 1998 1899 3479 68.3 125.8
8 1999 2715 6194 97.4 223.2
9 2000 6082 12276 237 460.2
10 2001 13676 25952 540.2 1000.4
11 2002 18330 44282 584.2 1584.6
12 2003 13584 57866 516.192 2100.792
13 2004 17107 74973 650.066 2750.858
14 2005 15199 90172 577.562 3328.42
Source: AEPC, CADEC, 2004 and Piya, 2006

Fig: 2.8: Growth pattern of Solar home system
Nos. of Solar Home System and Capacity

200000 4000
180000
3500
160000
3000
140000
2500
Cumulative Nos
120000
100000 2000
80000
1500
60000
1000
40000
500
20000
0 0
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
year Cummulative Nos.
Cummalitive Capacity KWp
There are around 30 registered Solar PV companies operating for the dissemination of SHS with
hundreds of branch offices in the various district and rural areas of Nepal.
2.3.2 Wind
Wind is still unharnessed energy resource in Nepal. Due to its diverse topography and the
consequent variation in the meteorological conditions, it is difficult to generalize wind conditions
in the country. Specific areas have been identified as a favorable for viable wind energy
generation. Studies made for the World Bank in 1977 indicate that in the Khumbu area, average
wind speed obtainable for wind energy generation is over 5 m/s. The Department of Hydrology
and Meteorology (DHM) conducted a study in 1983 and recorded wind speed data for a number
of stations. The conclusion drawn by DHM indicates that wind could be used for electricity
generation in the hills and for irrigation and pumping of drinking water in the Terai. The study by
DANGRID, a Danish consulting firm in 1992 reported that a potential to generate 200 MW of
electrical power with an annual energy production of 500 GWh from the wind resources along the
12 km valley between Kagbeni and Chusang in Mustang District of Nepal. This is about 33% of
the present electricity production of Nepal. WECS along with DHM, Alternative Energy
Promotion Center (AEPC) and Royal Nepal Academy of Science and Technology (RONAST)
carried out study on the Potential of Wind Resources in Nepal in the year 1999-2002. Some data
of the study on wind speed are given on the table 2.11 (source: WECS, 2002). This result shows
that there is not high potentiality of wind energy in Nepal except for some location like
Thakmarpha, Khumbu and Khanjiroba, which are again on the high mountainous location and is
with no infrastructural development.

Table 2.11: Wind Speed Data for some location of Nepal in m/s
Station Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Annual
Dadeldhura 2.08 2.28 2.48 2.55 2.66 2.19 1.94 1.81 1.81 2.00 1.87 1.91 2.13
Mahendra Nagar 0.43 0.57 0.74 1.00 0.99 0.87 0.75 0.59 0.45 0.39 0.37 0.40 0.63
Dhangadhi 0.61 0.75 1.01 1.26 1.43 1.37 1.04 0.80 0.63 0.47 0.48 0.47 0.86
Dipayal 0.26 0.41 0.65 0.84 0.99 0.92 0.70 0.44 0.47 0.54 0.41 0.24 0.57
Jumla 1.24 1.56 1.82 1.89 2.15 2.38 1.91 1.58 1.59 1.86 1.67 1.33 1.75
Pusma Camp 0.89 1.17 1.57 1.92 1.89 1.19 0.62 0.56 0.66 0.82 0.80 0.78 1.07
Chisapani 2.39 2.38 2.62 2.82 2.44 1.76 1.09 1.09 1.29 1.77 2.29 2.55 2.04
Surkhet 0.97 1.21 1.38 1.56 1.57 1.33 0.97 0.78 0.70 0.79 0.73 0.78 1.06
Nepalganj 0.51 0.82 1.08 1.42 1.69 1.62 1.37 1.07 0.80 0.52 0.43 0.50 0.99
Sikta 0.45 0.55 0.88 1.18 1.39 1.01 0.46 0.20 0.35 0.36 0.24 0.28 0.61
Thakmarpha 4.48 4.75 4.53 4.20 4.41 5.00 4.91 4.72 4.33 3.93 3.93 4.16 4.45
Mustang 1.54 1.93 1.57 1.78 1.76 1.85 1.65 1.48 1.59 1.39 1.27 1.62 1.62
Dumkauli 0.18 0.53 0.77 0.96 0.73 0.49 0.28 0.17 0.14 0.12 0.15 0.14 0.39
Bhairahawa 0.50 0.65 0.94 1.49 1.73 1.60 1.52 1.27 0.92 0.53 0.45 0.43 1.00
Parasi 1.53 1.78 2.36 3.49 4.03 4.38 3.68 3.06 2.33 1.22 0.99 1.04 2.49
Khanchikot 2.08 2.38 2.93 3.09 2.72 2.37 2.03 1.77 1.93 1.82 1.85 1.93 2.24
Simari 0.65 0.80 1.10 1.63 1.65 1.46 1.38 1.07 0.98 0.58 0.44 0.50 1.02
Pokhara 0.59 0.83 1.03 1.07 0.93 0.73 0.68 0.64 0.61 0.54 0.53 0.50 0.72
Gorkha 0.64 0.83 0.95 1.10 0.96 0.65 0.54 0.59 0.63 0.64 0.65 0.71 0.74
Malepatan 0.39 0.48 0.60 0.57 0.48 0.39 0.31 0.31 0.33 0.29 0.25 0.26 0.39
Lumle 1.19 1.27 1.40 1.36 1.34 1.24 1.20 1.16 1.15 1.15 1.13 1.15 1.23
Khairini Tar 0.38 0.51 0.66 0.76 0.76 0.67 0.54 0.49 0.44 0.39 0.34 0.33 0.52
Rampur 0.46 0.66 0.93 1.19 1.17 0.98 0.80 0.77 0.70 0.48 0.33 0.37 0.74
Parwanipur 0.71 0.97 1.27 1.70 1.83 1.65 1.55 1.32 1.17 0.73 0.57 0.55 1.17
Kakani 1.43 1.71 1.98 1.97 1.95 1.65 1.69 1.61 1.41 1.28 1.25 1.28 1.60
Khumultar 1.00 1.24 1.35 1.36 1.43 1.37 1.31 1.19 1.12 1.04 0.93 0.88 1.19
Kathmandu 0.44 0.67 0.85 0.86 0.87 0.68 0.54 0.46 0.39 0.35 0.30 0.30 0.56
Panchkhal 0.36 0.51 0.63 0.68 0.65 0.53 0.42 0.39 0.33 0.33 0.29 0.28 0.45
Nagarkot 2.31 2.86 3.25 3.30 2.89 2.49 2.06 1.91 2.17 2.03 1.83 1.81 2.41
Jiri 0.77 0.86 0.87 0.95 0.84 0.52 0.36 0.35 0.48 0.81 0.85 0.78 0.70
Hardinath 0.86 1.13 1.53 2.50 2.91 2.87 2.69 2.34 1.84 0.99 0.74 0.70 1.76
Okhaldhunga 1.70 2.47 3.13 3.66 2.91 2.18 1.76 1.70 1.67 1.51 1.50 1.50 2.14
Lahan 0.59 0.84 1.27 1.78 2.05 1.87 1.63 1.39 1.12 0.56 0.43 0.44 1.16
Chialsa 1.42 1.85 1.87 1.91 1.44 1.04 0.80 0.86 0.80 0.99 1.05 1.17 1.27
Pakhribas 1.59 1.62 1.90 2.03 1.78 1.50 1.27 1.32 0.94 1.41 1.62 1.45 1.54
Dhankuta 1.80 2.00 2.01 2.03 1.94 1.93 1.79 1.80 1.76 1.71 1.71 1.69 1.85
Biratnagar 0.53 0.82 1.23 1.74 1.89 1.71 1.38 1.12 0.89 0.49 0.37 0.39 1.05
Tarahara 0.92 1.14 1.54 2.16 2.20 2.08 2.07 1.77 1.55 1.04 0.93 0.88 1.52
Bhojpur 0.72 0.84 0.97 0.96 0.76 0.57 0.45 0.51 0.53 0.64 0.69 0.69 0.70
Taplejung 1.02 1.17 1.23 1.21 1.05 0.85 0.65 0.62 0.68 0.95 0.93 0.90 0.94
Ilam Tea Estate 0.92 0.97 1.28 1.54 1.30 1.06 0.73 0.68 0.67 0.84 0.98 0.92 0.99
Kankai 0.42 0.57 0.74 0.96 0.79 0.71 0.64 0.57 0.52 0.36 0.30 0.31 0.57
Kanjiroba 4.95 5.00 4.65 4.55 2.35 2.25 1.70 0.70 2.10 2.70 1.10 5.10 3.10
Annapurna 3.16 3.18 3.08 3.06 3.14 2.82 2.78 1.99 2.52 2.79 3.00 3.10 2.88
Langtang 2.90 3.16 3.20 3.30 3.40 2.94 2.76 2.40 2.57 3.23 2.94 2.80 2.97
Khumbu 4.77 4.65 5.17 5.53 5.60 4.70 4.47 4.04 5.03 4.25 4.57 4.47 4.77
Source: WECS 2002
2.3.3 Biogas
Biogas is a methane rich gas produced by the digestion of animal, human and bio-solid
waste. In Nepal it is the animal waste mainly used for the biogas production. In some
places the plants are integrated with toilets for the production of biogas. The digesters,
where the animal wastes are digested anaerobically, is either fixed dome type or floating
drum type. The fixed dome model has become popular as they are easier to construct,
operate and maintain using indigenous raw materials.
The potentiality of producing biogas is about 1.9 million plants out of which 57% in terai,
43% in hills and mountains. The Biogas Support Programme (BSP) under the Alternative
Energy Promotion Center and with the cooperation from various donors like SNV and
KfW is promoting the installation of biogas plant in various part of the country.
There are about 140, 519 biogas plants installed in various districts of Nepal. Also there
are about 60 private biogas companies and 15 biogas appliances manufacturing
workshops in the country for the effective dissemination of this technology in Nepal.
Also the biogas program is developed as the first CDM project in Nepal.
2.3.4 Micro- Hydro
The hydro power stations for generation of mechanical and electrical energy up to a
capacity of 100 kW come under microhydro in Nepal. The installations of such units do
not require nay license from the Government. In fact, the Government of Nepal has
delicensed installation of hydropower plants up to 1000 kW. The Government of Nepal is
providing subsidies for the installation of microhydro plant according to the location and
remoteness of the districts of Nepal. Till 2005, there are about 1541 microhydro
(including picohydro) electrification schemes installed in various part of the country with
the total installed capacity of about 8.5MW. Also there are similar numbers of unit for
mechanical power generation for the milling purpose in the country. Table 2.12 provides
the details about the installation and the capacity of microhydro electrification unit for
different years.

Table 2.12: Microhydro electrification units installed capacity
Classification of Schemes
Pico-hydro Micro-hydro
(up to 3 kW) (3 - 100 kW) Total Cumulative Total
Year of
Installation No. kW No. kW No. kW No. kW
2005* 36 72.9 31 512.6 67 585.5 1541 8583.82
2004 66 140.85 35 420.75 53 316.4 1474 7998.32
2003 80 184.32 53 749.5 133 933.82 1421 7681.92
2002 61 140.5 34 364.5 95 505 1288 6748.1
2001 36 81.2 50 891 86 972.2 1193 6243.1
2000 112 213.45 40 719.5 152 932.95 1107 5270.9
1999 123 226.4 25 386.5 148 612.9 955 4337.95
1998 97 185 28 430.5 125 615.5 807 3725.05
1997 84 143.4 16 262.7 100 406.1 682 3109.55
1996 130 203.3 14 174.2 144 377.5 582 2703.45
1995 115 170.9 13 145.3 128 316.2 438 2325.95
1994 79 100.3 5 125.7 84 226 310 2009.75
1993 - - 3 26.5 3 26.5 226 1783.75
1992 13 12 6 106.5 19 118.5 223 1757.25
1991 46 43 7 125.1 53 168.1 204 1638.75
1990 - - 11 97.8 11 97.8 151 1470.65
1989 - - 17 183 17 183 140 1372.85
1988 - - 11 109.8 11 109.8 123 1189.85
1987 - - 17 190.5 17 190.5 112 1080.05
1986 - - 20 203.8 20 203.8 95 889.55
1985 - - 16 168.8 16 168.8 75 685.75
1962-1984 - - 52 424.65 52 424.65 59 516.95
before - - 7 92.3 7 92.3 7 92.3
Source: CADEC, 2004 (fig for 2005 are provisional)

3. Energy Consumption Scenario
3.1 Consumption Pattern
The overall energy consumption of Nepal is largely dominated by the use of traditional
non commercial forms of energy such as fuelwood, agricultural residues and animal
waste. But this share is in the decreasing trend. The share of traditional forms of energy
to the energy consumption is estimated to about 88% in 2004/05 as compared to 91%
percent in 1995. The remaining 12% of energy consumed is through commercial source
(Petroleum fuels, Coal and Electricity) and Renewable. Table 3.1 shows the historical
trend of energy consumption by fuel type and the percentage share for the year 1995 and
2005. It can be seen that though in the slow pace, there is a shift in the energy
consumption pattern from traditional to the commercial and renewable sources. The share
of commercial has increased from about 9% in 1995 to about 12% in 2005. Similarly
there is a growing trend in the renewable. Within the commercial source, electricity is in
the higher side in substituting other fuels.
Table 3.1: Historical Trend of Energy Consumption by Fuel Type, in 000 GJ

Share % Share %
Fueltype 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 in 1995 in 2005
Traditional 258212 263634 267138 272893 278748 284735 290859 302085 308606 315269 322105 91.14% 87.71%
Fuelwood 230651 235495 237555 242687 247884 253199 258636 269158 274960 280888 286960 81.41% 78.14%
Agricultural residue 10354 10571 11645 11893 12166 12446 12732 13026 13327 13635 13964 3.65% 3.80%
Animal dung 17207 17568 17937 18314 18698 19091 19492 19901 20319 20746 21181 6.07% 5.77%
Commercial 24784 27759 29440 32741 34851 44956 43344 43852 43271 44863 43195 8.75% 11.76%
Petroleum 19119 21615 23623 26619 28180 30224 31286 32305 32116 31596 30063 6.75% 8.19%
LPG 643 916 1075 1131 1232 1508 1975 2401 2761 3257 3821 0.23% 1.04%
Motor Spirit 1172 1380 1497 1572 1674 1862 1984 2119 2259 2276 2534 0.41% 0.69%
Air Turbine Fuel 1357 1469 1731 1860 2009 2056 2283 1716 1911 2316 2417 0.48% 0.66%
Kerosene 6559 7568 8841 10226 10696 12006 11472 14018 12641 11271 8659 2.32% 2.36%
High Speed Diesel 8597 9501 9783 11402 11978 11780 12367 10857 11378 11369 11911 3.03% 3.24%
Light Diesel Oil 149 174 78 38 21 156 134 94 24 23 3 0.05% 0.00%
Fuel Oil 406 341 320 54 189 428 588 578 554 421 -28 0.14% -0.01%
Others 236 266 299 337 380 428 482 522 588 663 747 0.08% 0.20%
Coal 2839 3085 2540 2579 2893 10504 7446 6481 5721 7292 6459 1.00% 1.76%
Electricity 2826 3059 3278 3542 3778 4227 4612 5066 5434 5974 6673 1.00% 1.82%
Renewables 319 435 561 705 856 1015 1217 1432 1665 1779 1955 0.11% 0.53%
Biogas 298 412 536 678 826 981 1179 1392 1620 1731 1903 0.11% 0.52%
Micro Hydro 21 23 25 27 30 34 38 40 44 47 50 0.01% 0.01%
Solar 0 0 0 0 0 0 0 0 1 1 2 0.00% 0.00%
Others 0 0 0 0 0 0 0 0 0 0 0 0.00% 0.00%
Grand Total 283315 291827 297139 306339 314454 330706 335421 347369 353542 361910 367255 100.00% 100.00%
Fig 3.1 and 3.2 indicates the percentage share of fuel source and fuel type respectively in
the total energy consumption.

Fig 3.1: Energy Consumption by Source Type
Energy Consumption by Energy Source in 2004/05

367 million GJ
11.76% 0.53%
87.71%
Traditional Commercial Renewables
Fig 3.2: Energy Consumption by Fuel Type

Energy Consumption By Fuel Type 2004/05
Total Energy Consumption 367 million GJ
78.29%
3.81%
0.01%
0.001% 3.25% 5.78%
1.04%
0.52% 2.36% 0.66%
1.82% 1.76% 0.69%
Fuelwood Agricultural residue animal dung LPG Motor Spirit
Air T urbine Fuel Kerosene High Speed Diesel Coal Electricity
Biogas Micro Hydro Solar
The consumption of all the fuel types shows continues growth. Comapred to the three
different sources, it is the commercial source that grew more rapidly compared to other
sources. The fig 3.3 shows the different share of fuel types in the total energy
consumption since 1995 to 2005.

Fig. 3.3: Energy Consumption Trend by Fuel Type
Energy Consumption Trend by Fuel Type
400000
350000
300000
250000
000 GJ
200000
150000
100000
50000
0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Fuelw ood Agricultural residue animal dung Petroleum Coal Electricity Renew ables
3.2 Sectoral Energy Consumption
The energy consuming sectors has been defined as per the economic sector of the
country. They are residential, commercial, transport, industrial and agriculture sector. For
the ease energy accounting, others have been included as energy consuming entity which
does not fall in the above five sectors, are included in others like street light, temples,
mosques, church etc.. The sectoral energy consumption pattern for the year 2004/05 has
changed only marginally as compared to the previous years. Fig 3.4 shows the different
share percentage of energy consumption by various sectors in 2004/05. The figure shows
that the residential accounts for the major share of energy consumption (90.28%),
followed by transport (3.78%), industry (3.48%), commercial (1.45%) and then the
agricultural and others.
WECS has been putting in effort in analyzing and maintaining data on sectoral energy
consumption by fuel type and end use. Fig. 3.5 shows the historical trend of energy
consumption by these sectors since 1995. It can be observed that share of residential
sector in the total energy consumption is decreasing in the steady pace (table 3.2), while
others sectors have a steady pace of increasing trend. In Nepal, due to inadequate nos. of
energy intensive industries, Industrial sector come in the third position in the total energy
consumption. Detailed break-down of energy consumption of fuel type for each sub
sectors are discussed in the subsequent sections.

Fig. 3.4: Share of Sectoral Energy Consumption.
Sectoral Energy Consumption, 2004/05
90.28%
0.17% 3.47%
0.84% 3.78% 1.45%
Residential Industrial Commercial Transport Agricultural Others
Fig.: 3.5 Historical Trend of Energy Consumption in Various Sectors
Historical Trend of Energy Consumption in Various Sector
400000
350000
300000
250000
in 000 GJ
Agricultural
200000 Transport
Commercial
150000
Industrial
100000
Residential
50000
0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Year

Table 3.2: Percentage share of Sectoral Energy Consumption at different years.
Sector 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Residential 92.11% 91.68% 92.33% 91.90% 91.53% 89.25% 89.78% 90.58% 90.59% 90.17% 90.28%
Industrial 3.91% 4.03% 2.16% 2.26% 2.39% 4.75% 3.88% 3.61% 3.39% 3.79% 3.47%
Commercial 0.90% 0.97% 1.07% 0.95% 1.02% 1.12% 1.23% 1.42% 1.48% 1.47% 1.45%
Transport 2.77% 2.99% 4.02% 4.42% 4.72% 3.87% 4.05% 3.46% 3.59% 3.63% 3.78%
Agricultural 0.23% 0.24% 0.33% 0.36% 0.23% 0.90% 0.94% 0.80% 0.82% 0.80% 0.84%
Others 0.09% 0.09% 0.10% 0.10% 0.11% 0.11% 0.12% 0.13% 0.14% 0.15% 0.17%
Grand total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
3.2.1 Residential Sector Energy Consumption
The residential sector consumes almost 90% of the total energy consumption of Nepal in
2004/05. This sector consumes about 331 million GJ in 2004/05. Biomass resources are the
major fuels used in this sector, namely the fuelwood, agricultural residue and the animal waste.
Recently renewable sources like biogas and electricity from micro-hydro and solar home systems
are substituting the conventional fuels used mainly for cooking and lighting. The commercial
sources of fuel used in nominal in amount and is mainly used in the urban centers. Fig. 3.6
presents the share of different fuels used in the residential sector in 2004/05.
Fig.3.6: Share of Different Fuel Types in the Residential Sector.
Share of Different Fuel types in Residential Energy

Consumption, 2004/05
331 millions GJ
84.77%
Fuelwood
Agricultural residue
Animal dung
Petroleum
Coal
6.32% 3.73%
0.46% Electricity
Renewables
0.64%
4.08%
0.01%
Residential sector energy consumption is the function of number of household and

population. The population growth rates as well as the economic situation of the
household are used as the main driver for the types of fuel and energy consumption in the
residential sector of Nepal. The trend of household energy consumption is presented in

the Annexes. In the residential sector, the energy used in mainly for different end-uses
mainly, cooking, heating, animal feed preparation, lighting etc.
It has been observed that the LPG is substituting as a cooking fuel in the urban centers as
the consumption growth rate of LPG is about 11% per annum for the last few years
followed by electricity with 8%. Though nominal in quantitative term of the renewable,
the growth rate of solar is quite high with 52% followed by biogas and electricity from
micro-hydro with 8% each. There is a very high decreasing trend in the use of kerosene
in the residential sector. The overall growth rate of energy consumption in the residential
sector is about 1.2% per annum.
3.2.2 Industrial Sector Energy Consumption
The industrial sector share of energy consumption in about 3.5% of the total energy
consumption in Nepal. The energy consumption has been increasing marginally during
the last few years Since 1995 the industrial energy consumption has increased at the rate
of 1% only. It is estimated that about 12.7 million GJ of energy is consumed in the
industrial sector in 2004/05. Fig. 3.7 presents the share of different fuels used in the
industrial sector.
Fig. 3.7: Share of Different Fuels in the Industrial Sector
Share of different fuel Types in Industrial Energy

Consumption, 2004/05,
12.7 millions GJ
6%
22% 12%
10%
50%
Fuelw ood Agricultural residue Petroleum Coal Electricity
The energy intensity of the industrial sector is quite high as compared to other developing
countries due to the fact that Nepal’s industries are mainly based upon the upon the
traditional products and contribute little to the value added. Still this sector relies on the
biomass fuels like fuelwood and agriculture residue. Fuelwood accounts for almost 50%
of the energy consumed in this sector followed by electricity and petroleum products. The
main end uses in the industrial sector are process heating, motive power, water boiling in
the boilers and lighting.

3.2.3 Commercial Sector Energy Consumption
Total energy consumed in the commercial sector, which includes schools, hotels,
restaurants, government and non-government institutions etc. has increased from 2.5
million GJ in 1995 to 5.3 million GJ 2004/05 which shows an increase in 8% per annum.
The main fuels used in the commercial sector are fuelwood, LPG, kerosene and
electricity. The main end-uses of the commercial sector are quite similar to that of
residential sector such as cooking, heating, lighting, cooling etc. Fig. 3.8 presents the
different share of fuel types consumed in the commercial sector. It is seen that fuelwood
accounts with the highest share of 39% followed by LPG (32%), Kerosene 22% and then
the electricity with 7%. For the last few years, it has been seen that the LPG consumption
growth rate in this sector is about 13%, while the growth rate of kerosene is in the
decreasing trend. Fuelwood and electricity consumption growth rate is about 4% and 5%
per annum respectively in this sector. The details breakdown of the energy consumption
of the fuel type is presented in the Annexes.
Fig. 3.8: Share of Different Fuels in the Commercial Sector
Share of different Fuels in Commercail Eenrgy Sector,

Electricity 2004/05, 5.3 millions GJ
7%
Kerosene Fuelw ood

22% 39%
LPG
32%
Fuelw ood LPG Kerosene Electricity
3.2.4 Transport Sector Energy Consumption
The total energy consumption in the transport sector has been in the increasing trend. It
has been seen that for the past few years the energy consumption growth rate in this
sector is about 4% annually. The total energy consumption of this sector in the year
2004/05 is about 13.8 million GJ. Fig. 3.9 shows the consumption of different fuels in
this sector during the year 2004/05. The details are presented in the Annexes. It can be
seen that high speed diesel takes the highest share with 63% followed by Motor Spirit
with 18% and then Air Turbine Fuel wit 17%. The contribution of LPG and electricity in
this sector is very minimal.

It is seen for the last few years that though in quantitative term, LPG’s contribution is
minimal; the growth trend is about 12% in this sector. Other fuels having high growth
rate in this sector is ATF with 9% and Motor Spirit with 5%.
Fig. 3.9: Share of Different Fuels in the Transport Sector

Share of Different Fuels in Transport Sector Energy
13.8 million GJ
LPG
Electricity
0.81%
0.15% Motor Spirit
18.24%
Air Turbine Fuel

High Speed Diesel 17.40%
63.40%
LPG Motor Spirit Air Turbine Fuel High Speed Diesel Electricity
3.2.5 Agriculture Sector Energy Consumption
The total energy consumption in the agriculture sector is about 3million GJ in the year
2004/05. It is about 0.84% of the total energy consumption of the country in the same
year.
Fig. 3.10: Share of Different Fuels in the Agriculture Sector

Share of Different Fuels in Agriculture Sector Energy
3 million GJ
Electricity
6%
High Speed Diesel

94%

Though nominal in energy consumption, the growth rate is about 3% annually. The main
fuels used in this sector are high speed diesel and electricity. Fig. 3.10 shows the share of
different fuel types in the year 2004/05. Diesel accounts for 94% of the total energy used,
while electricity is only 4%. Diesel is used for water pumping (irrigation) as well as for
land preparation, harvesting etc. (tractors) and electricity is used for lift irrigation.
Although, fertilizers, manure and animate power are essential inputs in the agriculture
sector, they are not accounted in the national energy accounts due to the fact that the data
are scarce and often it is debated whether they should be accounted as energy input.

4. Energy Imports and Exports
Nepal imports petroleum products and coal to meet all of its fossil fuel demand. For coal,
except some negligible amount of primary production of lignitic coal in the Dang district,
India is the major source of coal supply. The petroleum products are purchased from
international markets and transported and exchanged with India. Nepal import and export
(exchange) electricity from and to India under the power purchase agreement between the
two countries.
4.1 Petroleum Fuels
Nepal Oil Corporation (NOC) is the sole authority for import and distribution of
petroleum products in Nepal. Under the latest import arrangement, NOC purchases crude
oil from the international market and delivers them to India. In exchange, Indian Oil
Corporation supplies a proportionate ratio of necessary petroleum products from
refineries and distribution channels close to the Nepalese border. Under this arrangement
the Indian Oil Corporation levies service charges for the services rendered. The quantity
of import of petroleum products imported is calculated on the basis of demand projected
by Nepal Oil Corporation. NOC maintains storage of petroleum products at Biratnagar
and Mahendranagar (Dhana\usa) for supply of Eastern Development Region;
Amlekhgunj and Kathmandu for Central Development Region,; Bhalwari and Pokhara
for supply of Western Development Region; Nepalgunj and Surkhet for Mid-Western
Development Region; and Dhangadhi and Dipayal for supply in the Far-Western
Development Region to maintain regular supply in the country. Nepal’s storage capacity
for the petroleum products except for LPG is roughly for thirty days consumption. For
LPG, the private gas companies distribute LPG from various stations which in total has
the capacity of a week long storage only.
Nepal imported about 685623 KL of major petroleum products in 2062 B.S which is
about 8% less than the previous year. The past five years show a declining trend in the
import of the petroleum products. This is due to the political instability and mainly due to
the heavy loss incurred by NOC in the past few years. But the provision figures for 2063
B.S shows that there is slight increment in the import of the petroleum products. Table
4.1 shows the import of different types of petroleum fuel at different years.

Table 4.1: Historical trend of import of Petroleum products
MS Diesel Kerosene LPG ATF Total Increment
Year Petroleum* %
(KL) (KL) (KL) (MT) (KL)
2050/51 31,476 195,473 162,324 9,760 30,436 419,709 14%
2051/52 35,019 228,016 176,963 13,049 37,886 477,884 15%
2052/53 41,736 254,323 213,830 18,600 40,776 550,665 9%
2053/54 46,621 259,358 244,546 21,824 48,722 599,247 15%
2054/55 47,507 302,063 287,595 22,961 51,700 688,865 5%
2055/56 51,584 319,158 298,351 25,019 56,010 725,103 9%
2056/57 55,570 327,427 350,196 30,627 59,123 792,316 -1%
2057/58 59,245 333,791 325,198 40,102 65,620 783,854 1%
2058/59 63,578 287,657 390,113 48,757 47,274 788,622 -2%
2059/60 68,482 301,672 351,696 56,079 53,546 775,396 -4%
2060/61 67,965 302,644 313,127 66,142 64,394 748,130 -8%
2061/62 76,097 308,076 233,310 77,594 68,340 685,823 2%
2062/63 78,463 310,535 233,310 89,045 76,887 699,195
* Except for LPG
4.2 Coal
Nepal has some sporadic deposits of low grade lignitic coal. A very negligible amount of
the total coal supply is extracted in Dang District for consumption in the brick industries.
For the major supply, the coal is imported from India and abroad. Nepal Coal Limited
was the sole agency for the import of coal before 1993. After 1993, NCL become inactive
and private enterprises came into existence for the import of coal. These enterprises make
their own agreement with Coal India Limited or other Suppliers abroad and supply the
coal to the market. These enterprises are entitled to fix their own prices for the coal.
Table 4.2 shows the status of import and primary production of coal in Nepal for different
years.
Table 4.2: Import and primary production of coal

Year Primary Import Total
Production
2050/51 54.75 54.75
2051/52 113.04 113.04
2052/53 122.81 122.81
2053/54 101.10 101.10
2054/55 102.66 102.66
2055/56 10.95 104.22 115.18
2056/57 17.53 400.62 418.15
2057/58 16.59 279.84 296.43
2058/59 9.61 248.39 258.00
2059/60 11.85 215.91 227.76
2060/61 10.459 279.842 290.301
2061/62 9.26 247.88 257.14

Coal is mainly used in the Industrial sector in Nepal. Industries such as cement, lime and
brick manufacturing depend on the imported coal. In addition, Steel Rolling Mills are the
major consumer of coal.
4.3 Electricity
With the agreement between Nepal and India, both the countries exchange electricity as
per the need. The exchange points are located at various places in the border line. Though
there is a provision in the agreement to exchange to about 150 MW of electrical power
between the two neighbors, but due to lack of transmission facility, it is limited below
100 MW.
The electricity imported from India along the points of exchange for the year 2005
(2061/62) is about 241 GWh whereas export to India is about 110 GWh. The table 4.3
below shows the quantity exchanged between the two countries since 1997. It can be seen
that except for the year 2003, Nepal is the net importer of electricity.
Table 4.3: Exchange of Electricity between Nepal and India

Category 1997 1998 1999 2000 2001 2002 2003 2004 2005*
Export to India 100.22 67.41 64.16 95.00 126.00 133.86 192.25 141.24 110.70
Import from India 153.98 210.29 232.39 232.20 226.54 238.29 149.88 186.68 241.39
Net Import/Export 53.76 142.88 168.23 137.20 100.54 104.43 -42.37 45.44 130.69

5. Energy Prices and Markets
5.1 Market Structure and Pricing Overview

In Nepal, though the economic structure is a free market economy, the market of the
commercial energy sector is monopolistic in nature. The market and prices of the energy
fuels have a unique characteristic in Nepal. The huge energy consumed comes from the
biomass sources and majority of it is non-monetized. Except for the fuel-wood supplied
by the Timber Corporation of Nepal (TCN) and some back-loaded supply to the urban or
market centers, all other are financially freely available. The electricity, fossil fuels and
some alternative sources of energy pass through the monetized market. With the 13% of
commercial energy and 0.5% of the alternative energy, in the total energy consumption
share, it is about 40% of the total energy that is monetized. Although these commercial
fuels, especially the fossil fuels consumption constitutes a small proportion in the overall
energy share, the import of it has a significant impact on the country’s overall foreign
exchange service.
5.1.1 Fuel-wood Market and Prices
The main sources of fuelwood are government forests controlled by the Ministry of
Forest and Soil Conservation. The ministry officially allocates forest area to the TCN for
the extraction of forest products. The unofficial extraction of fuelwood by the rural
people is a common phenomenon for their self consumption. However, some part of it is
traded to the market centers nearby. The fuelwood extraction and selling activities make a
considerable contribution for subsistence income in many rural areas.
As such the official allocation of fuelwood prices is by TCN through the ministry. The
TCN sets the official price of forest products at each stage of harvesting, transportation,
wholesaling and retailing. TCN fuelwood price varies within Nepal depending upon
transport distance from the harvesting area to the urban depot: the variation however,
does not necessarily cover the differential transport cost. Supply of fuelwood from TCN
depots is currently insufficient, however, to have much impact on the fuelwood prices.
The market clearing prices of fuelwood is therefore determined at the private depots of
the urban areas. The prices of fuelwood allowed by the Government of Nepal to be
charged by TCN do not cover the full cost incurred by TCN to supply most fuelwood to
the consuming centers. As a consequence of the inability to obtain sufficient extraction
permits from the Ministry of Forest and Soil Conservation, almost all the depots of TCN
have limited supply availability. TCN however, maintain the supply of fuelwood to
crematoria, during certain critical months such as Dashain and Tihar festivals, or when
they are pressurized by the local people to provide fuelwood. Table 5.1 shows the price
of fuelwood at different centers.

The actors involved in the fuelwood marketing in the urban centers are the depots of
TCN, private depots and dealers. With the head office located in Kathmandu, TCN has
branch offices and sub-branch offices in most urban centers. It has about 100 sales depot
operated in different parts of the country and sixteen depots are operational in
Kathmandu itself.
The private sector has always been heavily involved in the fuelwood business in Nepal.
There are more than 50 private depots in the Kathmandu Valley. Terai urban centers have
fewer private depots but receive fuelwood from a greater diversity of sources, because it
may come from Nepal or from India and may be delivered directly by the backloaders, by
bus or truck or by rickshaw or cart.
The TCN set the official price for the fuelwood at each stage of harvesting,
transportation, wholesaling and retailing. The price should be approved by the cabinet of
Government of Nepal. TCN fuelwood price vary within Nepal depending on the transport
distance from the harvesting area to the urban depot. Supplies of TCN depots are
currently insufficient and have a much impact on the fuelwood price. The market clearing
price of fuelwood is therefore determined in the private depots of the urban areas.
Generally the market price of fuelwood is 2-3 times higher than that of the TCN price.
Table 5.1: Retail Price of Fuelwood at Different Location

Price/Kg
Location
TCN Depot Private Depot
Kathmandu 4.00 6.00 - 8.00
Kathmandu
(Crematorium) 2.80 -
Biratnagar 4.00 5.00 - 7.00
Birgunj 5.00 7.00
Hetauda 4.00 6.00
Butwal 4.00 7.00
Mahendra Nagar 3.00 5.00
Source: Gorkha Patra, October 2004
The basic wood transport activity involves three moves. The first is from the forest
clearing sites in the terai to the stacking places called as Ghadgadi. The second is from
the stacking depots. The third is from these depots to the consumers. Some large
customers, such as the military, police and the industrial customers (brick and tile
industries), bypass these depots and pickup the wood directly from the stacking places.
Another form of transport is the movement by backloaders from the government forests
either to the roadside for movements by trucks to private depots or directly to the village
market centers. The routes from the major sources to the consumers are as shown in the
chart given.

Chart Showing the Flow of Fuelwood from Source to Consumers
Source Collection Transport Dealer Point of Consumer

Point/Storage sale
Military/ Military/Police
Government TCN/DFO storage Police Trucks
Forest (Ghadgaddi)
Industries
Trucks TCN/Private
Confiscated
wood Individual TCN
collectors Depot
Bullock Carts
Private
Private
Storage Private
Forest
Point Depot Commercial
centers
Bus/loaded
Community/ trucks
Community
leasehold Back Loaders
Storage
forest
Back Load
Carrier/Bicycle
Household
On farm
Supply
The TCN, private sectors and the backloaders are responsible for the transport of the
fuelwood to the urban centers. The Department of Forests issues households permit to
TCN for the transport of the fuelwood. Private dealers who collect fuelwood using
industrial or institutional permits or through TCN and DOF auctions often deliver the
fuelwood directly to the industries, institutions and private depots of urban centers. The
backloaders also extract the fuelwood from the nearby government forest of the urban
centers and bring the wood to the market on their backs or bicycles. These backloaders
sells the fuelwood directly to the end-user and sometimes to the private depot also.
5.1.2 Petroleum Fuel Prices
Nepal Oil Corporation (NOC) is the sole agency in Nepal for the import and distribution
of the petroleum products. There are also several private enterprises for the distribution of
LPG in Nepal. The pricing policy for the major petroleum products such as kerosene,
HSD, petrol, ATF and LPG is approved by the Government of Nepal. The NOC board
can fix the price of other unregulated products. Table 5.2 presents the historical trend of
retail selling price of major petroleum products

Table 5.2: Historical Trend of Petroleum Fuels Price
Price of Different Petroleum Products in Nepalese Rupees
Sl. Kerosene/ Kerosene
Date Petrol/liter Deisel/liter LPG/Kg
No. liter (Quota)
1 2055.10.02 40 15.5 10.5 31.03
2 2056.07.10 40 23 13 31.03
3 2057.06.28 47 27.5 26 15.5 31.03
4 2057.08.01 47 27.5 22 15.5 31.03
5 2057.10.04 46 26.5 17 37.93
6 2059.08.07 52 26.5 17 51.72
7 2059.12.12 56 35.5 28 23 51.72
8 2060.01.07 56 33.5 27 20 51.72
9 2060.01.25 54 31 24 20 62.07
10 2061.04.28 56 31 24 20 62.07
11 2061.06.02 56 35 28 24 62.07
Source: Prabhat 2061, NOC
Trend Chart of Retail Price of Various Petroleum Products

Source : Prabhat 2061, NOC
70
60
50
Petrol
Nepalese Rupees
40 Deisel
Kerosene (Open)
30 Kerosene (Quota)
LPG
20
10
0
2051.02.05
2051.09.12
01.04.95
2052.06.15
2052.12.22
2053.03.27
2054.02.31
2054.03.11
2055.04.01
2055.10.02
2056.07.10
2057.06.28
2057.08.01
2057.10.04
2059.08.07
2059.12.12
2060.01.07
2060.01.25
2061.04.28
2061.06.02
Tim e and Date
5.1.3 Electricity Prices
Overall electricity use in the total energy consumption is about 1.5%. Electricity is
generally supplied through the grid extension by Nepal Electricity Authority. Also there
are isolated grids which provide electricity to certain isolated areas which are out of reach
of the national grid. Electricity is also provided through Micro Hydro Schemes and Solar
Home Systems.
Nepal Electricity Authority is primarily responsible for planning, construction and

operations for electric supply. Presently there are various Independent Power Producers
(IPPs), who generate electricity and under the Power Purchase Agreement with NEA sell
the bulk power to NEA. NEA is also in the process of unbundling and there will be

separate entities for generation, transmission and distribution as envisaged in National
Water Plan 2005.
There are two different price structures for the electricity produced for the residential
customer depending upon the type of transmission. The price structure for the electricity
transmitted by national grid and distributed is regulated by the Electricity Tariff Fixation
Commission, while the isolated system along with the micro hydro generated electricity
fixes the prices according to the generator.
The Government of Nepal, through NEA is also executing the rural electrification
program. As such, it has started to sell electricity in bulk to cooperatives and
communities for making the rural electrification more affordable.
The tariff for different sector of the economy is also different. Also for the residential
sector, the tariff depends upon the amount of the unit consumed. In the industrial sector,
the price of electricity is less compared to other sectors of the economy. Also, NEA has
introduced Time of the Day meters for effective utilization of the energy generated. The
table 5.3 below show different tariff structure for different sector of the economy.
Table 5.3: Existing Tariff Structure of NEA (Effective September 2001)

TIME OF DAY (TOD) TARIFF RATES
Consumer Category & Monthly Demand Energy charge (Rs/unit)
Supply Level Charges (Rs/kVA) Peak Time Off-Peak Normal
18.00 - 23.00 23.00 - 6.00 6.00 - 18.00
High voltage (66 kV
A. & above)
1. Industrial 175.00 5.20 3.15 4.55
Medium voltage (33 kV)
B.
1. Industrial 190.00 6.55 4.00 5.75
2. Commercial 216.00 8.50 5.15 7.35
3. Non-commercial 180.00 8.85 5.35 7.70
4. Irrigation 47.00 3.85 2.35 3.40
5. Water Supply 150.00 4.55 2.75 3.95
6. Transport 180.00 4.70 2.95 4.15
7. Street Light 52.00 5.70 1.90 2.85
Medium voltage (11 kV)
C.
1. Industrial 190.00 6.70 4.10 5.85
2. Commercial 216.00 8.65 5.25 7.55
3. Non-commercial 180.00 9.00 5.45 7.85
4. Irrigation 47.00 3.95 2.40 3.45
5. Water Supply 150.00 4.60 2.80 4.10
6. Transport 180.00 4.80 3.00 4.25
7. Street Light 52.00 6.00 2.00 3.00
Note :
a) If demand meter reads kilowatts (kW) then kVA = kW/0.8
b) 10% discount in the total bill amount will be given to he HMG/N approved Industrial District
c) 25% discount in the total bill amount will be given to HMG Hospitals and Health Center (except residential complex)

1 DOMESTIC CONSUMERS
A Minimum Monthly Charge : METER CAPACITY Minimum Charge (NRs.) Exempt (kWh)
Upto 5 ampere 80.00 20.00
15 ampere 299.00 50.00
30 ampere 664.00 100.00
60 ampere 1394.00 200.00
Three phase supply 3244.00 400.00
B Energy charge
Upto 20 units Rs. 4.00 per unit
21-250 units Rs. 7.30 per unit
Over 250 units Rs. 9.90 per unit
2 TEMPLES
Energy Charge Rs. 5.10 per unit
3 STREET LIGHTS
A With Meter Rs. 5.10 per unit
B Without Meter Rs. 1860.00 per kVA
4 TEMPORARY SUPPLY
5 COMMUNITY WHOLESALE CONSUMER
6 INDUSTRIAL Monthly Demand Energy Charge
Charge(Rs/kVA) (Rs/unit)
A Low Voltage (400/230 volt)
(a) Rural and Cottage 45.00 5.45
(b) Small Industry 90.00 6.60
B Medium voltage (11kV) 190.00 5.90
C Medium voltage (33kV) 190.00 5.80
D High voltage (66kV and above) 170.00 4.60
7 COMMERCIAL
A Low Voltage (400/230 volt) 225.00 7.70
8 Non-Commercial
A Low Voltage (400/230 volt) 160.00 8.25
9 IRRIGATION
A Low voltage (400/230 volt) - 3.6
B Medium voltage (11kV) 47 3.5
C Medium voltage (33kV) 47 3.45
10 WATER SUPPLY
A Low voltage (400/230 volt) 140 4.3
C Medium voltage (33kV) 150 4
11 TRANSPORT
A Medium voltage (11kV) 180 4.3

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Annexes
Annex – 1 : Energy Conversion Tables

Annex – 2 : Sectoral Energy Consumption Pattern
Annex – 3 : Nepal Energy Supply Demand Balance

Annex 1
Conversion Factors and Energy Content
Basic Energy Conversion
Units Kcal (000) GJ TCE TOE

Kilo Calori 1.0000 0.0041868 0.0001429 0.0000972
GJ 238.8459 1.0000000 0.0341208 0.0234622
TCE 7000.00 29.3076000 1.0000000 0.0687622
TOE 10290.00 42.6217000 1.4542880 1.0000000
Energy Contents of Various Fuel Type
Fueltype Unit Kcal (000) GJ TCE TOE Other

Traditional Fuel
Fuelwood tonne 4000 16.75 0.57 0.39 1.43 m3
m3 2800 11.72 0.4 0.27 0.7 tonne
Charcoal tonne 7100 29.73 1.01 0.69 2.86 m3
m3 2485 10.4 0.36 0.24 0.35 tonne
Agricultural Waste tonne 3000 12.56 0.43 0.29 m3
m3 tonne
Animal Dung* tonne 2600 10.89 0.37 0.25 m3
m3 tonne
Biogas 000 m3 5800 23 0.83 0.56
Commercial Fuel Unit Kcal (000) GJ TCE TOE Others
Coal tonne 6000 25.12 0.86 0.58

kl 30.08 0.611 tonne
LPG tonne 11760 49.24 1.68 1.14 1.637 KL
kl 8000 33.49 1014 0.78 0.71 tonne
MS tonne 11290 47.27 1.61 1.1 1.41 kl
kl 8640 36.17 1.23 0.84 0.78 tonne
ATF tonne 11130 46.60 1.59 1.08 1.29 kl
kl 8660 36.26 1.24 0.84 0.78 tonne
KRS tonne 11130 46.06 1.59 1.08 1.29 kl
kl 9060 37.93 1.29 0.88 0.83 tonne
HSD tonne 10960 45.89 1.57 1.07 1.21 kl
kl 9350 39.15 1.34 0.91 0.85 tonne
LDO tonne 10960 45.89 1.57 1.07 1.17 kl
kl 9860 41.28 1.41 0.96 0.93 tonne
FO tonne 10560 44.21 1.51 1.03 1.07 kl
Electricity MWh 860 3.6 0.12 0.08 5.78 GHh from oil
* dry basis, One tonne of dung yields 190 cubic meter of biogas at 15 degree Centrigrade

Annex 2
Sectoral Energy Consumption Pattern
Annex 2a
Residential Sector Energy Consumption
in 000 GJ
Fueltype 2001/02 2002/03 2003/04 2004/05 2005/06*

Traditional 298349 304611 311186 317798 324516
Fuelwood 266724 272323 278220 284138 290149
Agricultural residue 11723 11970 12221 12478 12742
Animal dung 19901 20319 20746 21181 21626
Commercial 14874 13993 13356 11815 12045

Petroleum 12839 11748 10892 9061 9108
LPG 1301 1451 1711 2008 2217
Motor Spirit 0 0 0 0 0
Air Turbine Fuel 0 0 0 0 0
Kerosene 11537 10297 9181 7053 6891
High Speed Diesel 0 0 0 0 0
Light Diesel Oil 0 0 0 0 0
Fuel Oil 0 0 0 0 0
Others 0 0 0 0 0
Coal 27 23 29 25 39
Electricity 2009 2222 2435 2729 2898
Renewables 1432 1665 1779 1955 2134

Biogas 1392 1620 1731 1903 2078
Micro Hydro 40 44 47 50 53
Solar 0 1 1 2 3
Others 0 0 0 0 0
Total 314655 320269 326321 331567 338696

Annex 2b
Indusrial Sector Energy Consumption
in 000 GJ
Fueltype 2001/02 2002/03 2003/04 2004/05 2005/06*

Traditional 1986 2069 2157 2245 2338
Fuelwood 684 712 743 773 804
Animal dung 0 0 0 0 0
Commercial 10551 9900 11559 10516 14647

Petroleum 1945 1936 1812 1331 1469
LPG 0 0 0 0 0
Kerosene 662 603 538 413 404
Fuel Oil 578 554 421 -28 27
Others 522 588 663 747 841
Coal 6454 5698 7263 6434 10248
Electricity 2152 2266 2483 2750 2930
Renewables 0 0 0 0 0
Biogas 0 0 0 0 0
Micro Hydro 0 0 0 0 0
Solar 0 0 0 0 0
Others 0 0 0 0 0
Total 12537 11969 13716 12761 16985

Annex 2c
Commercial Sector Energy Consumption
in 000 GJ
Fueltype 2001/02 2002/03 2003/04 2004/05 2005/06*

Traditional 1750 1925 1926 2049 2214
Fuelwood 1750 1925 1926 2049 2214
animal dung 0 0 0 0 0
Commercial 3172 3303 3391 3286 3621

Petroleum 2846 2970 3001 2893 3205
LPG 1028 1229 1449 1700 2040
Kerosene 1818 1741 1552 1192 1165
Fuel Oil 0 0 0 0 0
Others 0 0 0 0 0
Coal 0 0 0 0 0
Electricity 326 334 389 394 417
Biogas 0 0 0 0 0
Solar 0 0 0 0 0
Others 0 0 0 0 0
Total 4921 5228 5316 5335 5836

Annex 2d
Transport Sector Energy Consumption
in 000 GJ
Fueltype 2001/02 2002/03 2003/04 2004/05 2005/06*

Traditional 0 0 0 0 0
Fuelwood 0 0 0 0 0
Commercial 12025 12703 13132 13894 14209

Petroleum 12004 12683 13112 13873 14189
LPG 72 81 96 113 128
Motor Spirit 2119 2259 2276 2534 2628
Air Turbine Fuel 1716 1911 2316 2417 2721
Kerosene 0 0 0 0 0
Fuel Oil 0 0 0 0 0
Others 0 0 0 0 0
Coal 0 0 0 0 0
Electricity 20 20 20 21 20
Biogas 0 0 0 0 0
Solar 0 0 0 0 0
Others 0 0 0 0 0
Total 12025 12703 13132 13894 14209

Annex 2e
Agriculture Sector Energy Consumption
in 000 GJ
Fueltype 2001/02 2002/03 2003/04 2004/05 2005/06*

Traditional 0 0 0 0 0
Fuelwood 0 0 0 0 0
Commercial 2776 2888 2892 3085 3100

Petroleum 2671 2780 2778 2905 2873
LPG 0 0 0 0 0
Kerosene 0 0 0 0 0
Fuel Oil 0 0 0 0 0
Others 0 0 0 0 0
Coal 0 0 0 0 0
Electricity 105 108 114 180 228
Biogas 0 0 0 0 0
Solar 0 0 0 0 0
Others 0 0 0 0 0
Total 2776 2888 2892 3085 3100

Annex 3
Energy Supply Demand Balance
Nepal Energy Supply Demand Balance
1995/96
in 000 GJ
Primary Total Primary Statistical Thermal Energy Final
Fueltype Import Export Residential Industrial Commercial Transport Agricultural Others Total
Production Supply/Sale Differences Generation Loss Supply
Traditional 263634 0 0 263634 0 0 0 263634 259026 3635 973 0 0 0 263634
Fuelwood 235495 0 0 235495 0 0 0 235495 231109 3430 956 0 0 0 235495
Agricultural residue 10571 0 0 10571 0 0 0 10571 10349 205 17 0 0 0 10571
animal dung 17568 0 0 17568 0 0 0 17568 17568 0 0 0 0 0 17568
Commercial 4152 25731 313 29215 354 546 1175 27759 8081 8136 1867 8721 690 262 27759
petroleum 0 22383 0 22029 354 414 0 21615 6883 4244 1275 8613 600 0 21615
LPG 0 916 0 916 0 0 0 916 796 0 120 0 0 0 916
Motor Spirit 0 1398 0 1380 18 0 0 1380 0 14 0 1365 0 0 1380
Air Turbine Fuel 0 1475 0 1469 6 0 0 1469 0 0 0 1469 0 0 1469
Kerosene 0 7753 0 7568 185 0 0 7568 6087 384 1097 0 0 0 7568
High Speed Diesel 0 9646 0 9501 145 0 0 9501 0 3295 0 5651 556 0 9501
Light Diesel Oil 0 174 0 174 0 0 0 174 0 3 0 128 44 0 174
Fuel Oil 0 755 0 755 0 414 0 341 0 308 33 0 0 0 341
Others 0 266 0 266 0 0 0 266 0 240 25 0 0 0 266
Coal 0 3085 0 3085 0 0 0 3085 15 2601 366 103 0 0 3085
Electricity 4152 263 313 4102 0 132 1175 3059 1183 1291 226 5 90 262 3059
Renewables 435 0 0 435 0 0 0 435 435 0 0 0 0 0 435

Biogas 412 0 0 412 0 0 0 412 412 0 0 0 0 0 412
Micro Hydro 23 0 0 23 0 0 0 23 23 0 0 0 0 0 23
Solar 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 268221 25731 313 293284 354 546 1175 291827 267542 11771 2840 8721 690 262 291827

1996/97
in 000 GJ
Traditional 267138 0 0 267138 0 0 0 267138 264466 1607 1065 0 0 0 267138
Fuelwood 237555 0 0 237555 0 0 0 237555 235962 546 1047 0 0 0 237555
animal dung 17937 0 0 17937 0 0 0 17937 17937 0 0 0 0 0 17937
Commercial 4230 27288 361 30980 177 537 1288 29440 9314 4811 2114 11942 966 293 29440
petroleum 0 24194 0 24017 177 394 0 23623 8026 1259 1607 11866 866 0 23623
LPG 0 1075 0 1075 0 0 0 1075 925 0 149 0 0 0 1075
Motor Spirit 0 1561 0 1497 64 0 0 1497 0 15 0 1482 0 0 1497
Air Turbine Fuel 0 1762 0 1731 31 0 0 1731 0 0 0 1731 0 0 1731
Kerosene 0 8867 0 8841 27 0 0 8841 7100 368 1372 0 0 0 8841
Light Diesel Oil 0 78 0 78 0 0 0 78 0 1 0 57 20 0 78
Fuel Oil 0 714 0 714 0 394 0 320 0 276 44 0 0 0 320
Others 0 299 0 299 0 0 0 299 0 258 41 0 0 0 299
Coal 0 2540 0 2540 0 0 0 2540 10 2195 264 71 0 0 2540
Electricity 4230 554 361 4423 0 143 1288 3278 1279 1356 243 5 101 293 3278
Renewables 561 0 0 561 0 0 0 561 561 0 0 0 0 0 561

Biogas 536 0 0 536 0 0 0 536 536 0 0 0 0 0 536
Micro Hydro 25 0 0 25 0 0 0 25 25 0 0 0 0 0 25
Solar 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 271928 27288 361 298678 177 537 1288 297139 274341 6417 3179 11942 966 293 297139

1997/98
in 000 GJ
Traditional 272893 0 0 272893 0 0 0 272893 270019 1674 1200 0 0 0 272893
Fuelwood 242687 0 0 242687 0 0 0 242687 240917 569 1200 0 0 0 242687
animal dung 18314 0 0 18314 0 0 0 18314 18314 0 0 0 0 0 18314
Commercial 3800 31335 243 34605 287 1480 1158 32741 10808 5247 1719 13546 1099 322 32741
petroleum 0 27999 0 27712 287 1093 0 26619 9433 1266 1462 13463 994 0 26619
LPG 0 1131 0 1131 0 0 0 1131 708 0 423 0 0 0 1131
Motor Spirit 0 1591 0 1572 19 0 0 1572 0 0 0 1572 0 0 1572
Air Turbine Fuel 0 1870 0 1860 10 0 0 1860 0 0 0 1860 0 0 1860
Kerosene 0 10428 0 10226 202 0 0 10226 8725 462 1039 0 0 0 10226
Light Diesel Oil 0 38 0 38 0 0 0 38 0 1 0 28 10 0 38
Fuel Oil 0 1147 0 1147 0 1093 0 54 0 54 0 0 0 0 54
Others 0 337 0 337 0 0 0 337 0 337 0 0 0 0 337
Coal 0 2579 0 2579 0 0 0 2579 11 2491 0 77 0 0 2579
Electricity 3800 757 243 4314 0 387 1158 3542 1364 1489 257 6 105 322 3542
Renewables 705 0 0 705 0 0 0 705 705 0 0 0 0 0 705

Biogas 678 0 0 678 0 0 0 678 678 0 0 0 0 0 678
Micro Hydro 27 0 0 27 0 0 0 27 27 0 0 0 0 0 27
Solar 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 277398 31335 243 308203 287 1480 1158 306339 281533 6921 2919 13546 1099 322 306339

1998/99
in 000 GJ
Traditional 278748 0 0 278748 0 0 0 278748 275690 1744 1314 0 0 0 278748
Fuelwood 247884 0 0 247884 0 0 0 247884 245977 593 1314 0 0 0 247884
animal dung 18698 0 0 18698 0 0 0 18698 18698 0 0 0 0 0 18698
Commercial 4046 33179 231 36933 61 1636 1301 34851 11270 5777 1901 14849 711 342 34851
petroleum 0 29724 0 29388 336 1208 0 28180 9779 1309 1623 14840 629 0 28180
LPG 0 1232 0 1232 0 0 0 1232 728 0 466 38 0 0 1232
Motor Spirit 0 1728 0 1674 53 0 0 1674 0 0 0 1674 0 0 1674
Air Turbine Fuel 0 2026 0 2009 17 0 0 2009 0 0 0 2009 0 0 2009
Kerosene 0 10818 0 10696 122 0 0 10696 9051 489 1156 0 0 0 10696
Light Diesel Oil 0 21 0 21 0 0 0 21 0 0 0 16 5 0 21
Fuel Oil 0 1414 0 1398 16 1208 0 189 0 189 0 0 0 0 189
Others 0 380 0 380 0 0 0 380 0 380 0 0 0 0 380
Coal 0 2618 0 2893 -275 0 0 2893 13 2881 0 0 0 0 2893
Electricity 4046 837 231 4651 0 428 1301 3778 1478 1588 278 9 82 342 3778
Renewables 856 0 0 856 0 0 0 856 856 0 0 0 0 0 856

Biogas 826 0 0 826 0 0 0 826 826 0 0 0 0 0 826
Micro Hydro 30 0 0 30 0 0 0 30 30 0 0 0 0 0 30
Solar 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 283649 33179 231 316536 61 1636 1301 314454 287815 7522 3215 14849 711 342 314454

1999/00
in 000 GJ
Traditional 284735 0 0 284735 0 0 0 284735 281479 1818 1439 0 0 0 284735
Fuelwood 253199 0 0 253199 0 0 0 253199 251142 618 1439 0 0 0 253199
animal dung 19091 0 0 19091 0 0 0 19091 19091 0 0 0 0 0 19091
Commercial 5049 43219 342 46950 976 919 1556 44956 12665 13899 2270 12798 2968 355 44956
petroleum 0 32319 0 30903 1416 679 0 30224 10938 1610 1975 12789 2911 0 30224
LPG 0 1508 0 1508 0 0 0 1508 867 0 595 46 0 0 1508
Motor Spirit 0 1861 0 1862 -1 0 0 1862 0 0 0 1862 0 0 1862
Air Turbine Fuel 0 2138 0 2056 82 0 0 2056 0 0 0 2056 0 0 2056
Kerosene 0 12698 0 12006 692 0 0 12006 10072 555 1380 0 0 0 12006
Light Diesel Oil 0 157 0 156 1 0 0 156 0 2 0 114 39 0 156
Fuel Oil 0 1109 0 1107 3 679 0 428 0 428 0 0 0 0 428
Others 0 428 0 428 0 0 0 428 0 428 0 0 0 0 428
Coal 0 10064 0 10504 -440 0 0 10504 45 10459 0 0 0 0 10504
Electricity 5049 836 342 5543 0 240 1556 4227 1681 1830 295 10 57 355 4227
Renewables 1015 0 0 1015 0 0 0 1015 1015 0 0 0 0 0 1015

Biogas 981 0 0 981 0 0 0 981 981 0 0 0 0 0 981
Micro Hydro 34 0 0 34 0 0 0 34 34 0 0 0 0 0 34
Solar 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 290799 43219 342 332700 976 919 1556 330706 295159 15717 3708 12798 2968 355 330706

2000/01
in 000 GJ
Traditional 290859 0 0 290859 0 0 0 290859 287390 1894 1575 0 0 0 290859
Fuelwood 258636 0 0 258636 0 0 0 258636 256416 644 1575 0 0 0 258636
animal dung 19492 0 0 19492 0 0 0 19492 19492 0 0 0 0 0 19492
Commercial 5813 40112 454 45183 289 374 1661 43344 12535 11104 2552 13592 3152 409 43344
petroleum 0 32267 0 31562 706 276 0 31286 10638 1815 2213 13570 3049 0 31286
LPG 0 1975 0 1975 0 0 0 1975 1103 0 812 59 0 0 1975
Motor Spirit 0 1984 0 1984 0 0 0 1984 0 0 0 1984 0 0 1984
Air Turbine Fuel 0 2373 0 2283 90 0 0 2283 0 0 0 2283 0 0 2283
Kerosene 0 11792 0 11472 320 0 0 11472 9535 536 1401 0 0 0 11472
Light Diesel Oil 0 134 0 134 0 0 0 134 0 2 0 98 34 0 134
Fuel Oil 0 867 0 864 3 276 0 588 0 588 0 0 0 0 588
Others 0 482 0 482 0 0 0 482 0 482 0 0 0 0 482
Coal 0 7030 0 7446 -417 0 0 7446 31 7415 0 0 0 0 7446
Electricity 5813 816 454 6175 0 98 1661 4612 1866 1874 339 21 103 409 4612
Renewables 1218 0 0 1217 0 0 0 1217 1217 0 0 0 0 0 1217

Biogas 1179 0 0 1179 0 0 0 1179 1179 0 0 0 0 0 1179
Micro Hydro 38 0 0 38 0 0 0 38 38 0 0 0 0 0 38
Solar 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 297890 40112 454 337260 289 374 1661 335421 301143 12998 4128 13592 3152 409 335421

.2001/02
in 000 GJ
Traditional 302085 0 0 302085 0 0 0 302085 298349 1986 1750 0 0 0 302085
Fuelwood 269158 0 0 269158 0 0 0 269158 266724 684 1750 0 0 0 269158
animal dung 19901 0 0 19901 0 0 0 19901 19901 0 0 0 0 0 19901
Commercial 6762 39575 482 45855 0 234 1891 43852 14874 10551 3172 12025 2776 454 43852
petroleum 0 32478 0 32478 0 173 0 32305 12839 1945 2846 12004 2671 0 32305
LPG 0 2401 0 2401 0 0 0 2401 1301 0 1028 72 0 0 2401
Motor Spirit 0 2119 0 2119 0 0 0 2119 0 0 0 2119 0 0 2119
Air Turbine Fuel 0 1716 0 1716 0 0 0 1716 0 0 0 1716 0 0 1716
Kerosene 0 14018 0 14018 0 0 0 14018 11537 662 1818 0 0 0 14018
Light Diesel Oil 0 94 0 94 0 0 0 94 0 1 0 69 24 0 94
Fuel Oil 0 751 0 751 0 173 0 578 0 578 0 0 0 0 578
Others 0 522 0 522 0 0 0 522 0 522 0 0 0 0 522
Coal 241 6240 0 6481 0 0 0 6481 27 6454 0 0 0 0 6481
Electricity 6520 857 482 6896 0 61 1891 5066 2009 2152 326 20 105 454 5066
Renewables 1432 0 0 1432 0 0 0 1432 1432 0 0 0 0 0 1432

Biogas 1392 0 0 1392 0 0 0 1392 1392 0 0 0 0 0 1392
Micro Hydro 40 0 0 40 0 0 0 40 40 0 0 0 0 0 40
Solar 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 310278 39575 482 349372 0 234 1891 347369 314655 12537 4921 12025 2776 454 347369

2002/03
in 000 GJ
Traditional 308606 0 0 308606 0 0 0 308606 304612 2069 1925 0 0 0 308606
Fuelwood 274960 0 0 274960 0 0 0 274960 272323 712 1925 0 0 0 274960
animal dung 20319 0 0 20319 0 0 0 20319 20319 0 0 0 0 0 20319
Commercial 7882 38124 692 45315 0 61 2014 43271 13993 9900 3303 12703 2888 484 43271
petroleum 0 32161 0 32161 0 45 0 32116 11748 1936 2970 12683 2780 0 32116
LPG 0 2761 0 2761 0 0 0 2761 1451 0 1229 81 0 0 2761
Motor Spirit 0 2259 0 2259 0 0 0 2259 0 0 0 2259 0 0 2259
Air Turbine Fuel 0 1911 0 1911 0 0 0 1911 0 0 0 1911 0 0 1911
Kerosene 0 12641 0 12641 0 0 0 12641 10297 603 1741 0 0 0 12641
Light Diesel Oil 0 24 0 24 0 0 0 24 0 0 0 18 6 0 24
Fuel Oil 0 598 0 598 0 45 0 554 0 554 0 0 0 0 554
Others 0 588 0 588 0 0 0 588 0 588 0 0 0 0 588
Coal 298 5424 0 5721 0 0 0 5721 23 5698 0 0 0 0 5721
Electricity 7585 540 692 7432 0 16 2014 5434 2222 2266 334 20 108 484 5434
Renewables 1665 0 0 1665 0 0 0 1665 1665 0 0 0 0 0 1665

Biogas 1620 0 0 1620 0 0 0 1620 1620 0 0 0 0 0 1620
Micro Hydro 44 0 0 44 0 0 0 44 44 0 0 0 0 0 44
Solar 1 0 0 1 0 0 0 1 1 0 0 0 0 0 1
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 318153 38124 692 355585 0 61 2014 353542 320269 11969 5228 12703 2888 484 353542

2003/04
in 000 GJ
Traditional 315269 0 0 315269 0 0 0 315269 311187 2157 1926 0 0 0 315269
Fuelwood 280888 0 0 280888 0 0 0 280888 278220 743 1926 0 0 0 280888
animal dung 20746 0 0 20746 0 0 0 20746 20746 0 0 0 0 0 20746
Commercial 8127 39398 505 47020 0 137 2093 44863 13356 11559 3391 13132 2892 533 44863
petroleum 0 31697 0 31697 0 101 0 31596 10892 1812 3001 13112 2778 0 31596
LPG 0 3257 0 3257 0 0 0 3257 1711 0 1449 96 0 0 3257
Motor Spirit 0 2276 0 2276 0 0 0 2276 0 0 0 2276 0 0 2276
Air Turbine Fuel 0 2316 0 2316 0 0 0 2316 0 0 0 2316 0 0 2316
Kerosene 0 11271 0 11271 0 0 0 11271 9181 538 1552 0 0 0 11271
Light Diesel Oil 0 23 0 23 0 0 0 23 0 0 0 17 6 0 23
Fuel Oil 0 522 0 522 0 101 0 421 0 421 0 0 0 0 421
Others 0 663 0 663 0 0 0 663 0 663 0 0 0 0 663
Coal 263 7030 0 7292 0 0 0 7292 29 7263 0 0 0 0 7292
Electricity 7864 672 505 8031 0 36 2093 5974 2435 2483 389 20 114 533 5974
Renewables 1779 0 0 1779 0 0 0 1779 1779 0 0 0 0 0 1779

Biogas 1731 0 0 1731 0 0 0 1731 1731 0 0 0 0 0 1731
Micro Hydro 47 0 0 47 0 0 0 47 47 0 0 0 0 0 47
Solar 1 0 0 1 0 0 0 1 1 0 0 0 0 0 1
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 325175 39398 505 364068 0 137 2093 361910 326321 13716 5316 13132 2892 533 361910

2004/05
in 000 GJ
Traditional 322105 0 0 322105 0 0 0 322105 317798 2245 2049 0 0 13 322105
Fuelwood 286960 0 0 286960 0 0 0 286960 284138 773 2049 0 0 0 286960
animal dung 21181 0 0 21181 0 0 0 21181 21181 0 0 0 0 0 21181
Commercial 8828 36941 399 45727 -356 49 2442 43334 11815 10516 3286 13894 3085 599 43195
petroleum 0 29846 0 30202 -356 0 0 30202 9061 1331 2893 13873 2905 0 30063
LPG 0 3821 0 3821 0 0 0 3821 2008 0 1700 113 0 0 3821
Motor Spirit 0 2548 0 2534 15 0 0 2534 0 0 0 2534 0 0 2534
Air Turbine Fuel 0 2472 0 2417 55 0 0 2417 0 0 0 2417 0 0 2417
Kerosene 0 8460 0 8659 -199 0 0 8659 7053 413 1192 0 0 0 8659
High Speed Diesel 0 11685 0 11911 -225 0 0 11911 0 199 0 8807 2904 0 11911
Light Diesel Oil 0 3 0 3 0 0 0 3 0 0 0 3 1 0 3
Fuel Oil 0 109 0 111 -2 0 0 111 0 -28 0 0 0 0 -28
Others 0 747 0 747 0 0 0 747 0 747 0 0 0 0 747
Coal 233 6227 0 6459 0 0 0 6459 25 6434 0 0 0 0 6459
Electricity 8596 869 399 9066 0 49 2442 6673 2729 2750 394 21 180 599 6673
Renewables 1955 0 0 1955 0 0 0 1955 1955 0 0 0 0 0 1955

Biogas 1903 0 0 1903 0 0 0 1903 1903 0 0 0 0 0 1903
Micro Hydro 50 0 0 50 0 0 0 50 50 0 0 0 0 0 50
Solar 2 0 0 2 0 0 0 2 2 0 0 0 0 0 2
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 332888 36941 399 369787 -356 49 2442 367394 331568 12761 5335 13894 3085 612 367255

2005/06*
in 000 GJ
Traditional 329094 0 0 329094 0 0 0 329094 324517 2338 2214 0 0 25 329094
Fuelwood 293168 0 0 293168 0 0 0 293168 290149 804 2214 0 0 0 293168
animal dung 21626 0 0 21626 0 0 0 21626 21626 0 0 0 0 0 21626
Commercial 9572 41795 480 50827 60 36 2472 48391 12045 14647 3621 14209 3100 667 48290
petroleum 0 31005 0 30944 60 0 0 30944 9108 1469 3205 14189 2873 0 30843
LPG 0 4385 0 4385 0 0 0 4385 2217 0 2040 128 0 0 4385
Motor Spirit 0 2628 0 2628 0 0 0 2628 0 0 0 2628 0 0 2628
Air Turbine Fuel 0 2781 0 2721 60 0 0 2721 0 0 0 2721 0 0 2721
Kerosene 0 8460 0 8460 0 0 0 8460 6891 404 1165 0 0 0 8460
Light Diesel Oil 0 4 0 4 0 0 0 4 0 0 0 3 1 0 4
Fuel Oil 0 128 0 128 0 0 0 128 0 27 0 0 0 0 27
Others 0 841 0 841 0 0 0 841 0 841 0 0 0 0 841
Coal 224 10064 0 10287 0 0 0 10287 39 10248 0 0 0 0 10287
Electricity 9348 727 480 9595 0 36 2472 7160 2898 2930 417 20 228 667 7160
Renewables 2134 0 0 2134 0 0 0 2134 2134 0 0 0 0 0 2134

Biogas 2078 0 0 2078 0 0 0 2078 2078 0 0 0 0 0 2078
Micro Hydro 53 0 0 53 0 0 0 53 53 0 0 0 0 0 53
Solar 3 0 0 3 0 0 0 3 3 0 0 0 0 0 3
Others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Grand Total 340800 41795 480 382055 60 36 2472 379619 338696 16985 5836 14209 3100 692 379518
* Provisional

Energy Synopsis Report 2006: Nepal

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Government of Nepal

Water and Energy Commission Secretariat

Energy Synopsis Report: Nepal

Report No: 7, Seq. No. 489

Energy Sector Synopsis Report, 2006 i

Energy Sector Synopsis Report, 2006 ii

References and Bibliography ..............................................................................48

Energy Sector Synopsis Report, 2006 iii

ADB/N Agriculture Development Bank, Nepal

Energy Sector Synopsis Report, 2006 v

2.2 Demographic Setting

Energy Sector Synopsis Report, 2006 1

Administratively, Nepal is divided in five development regions, fourteen zones and

1.3 Energy and Economy

Energy Sector Synopsis Report, 2006 2

1.4 Energy and International Cooperation

Energy Sector Synopsis Report, 2006 3

1.5 Energy Acts and Policies

Energy Sector Synopsis Report, 2006 4

Power project that require IEE:

The policy of Government of Nepal on Environmental Assessment requires that the

1.7 Gender and Energy

Energy Sector Synopsis Report, 2006 5

Energy Sector Synopsis Report, 2006 6

2.1 Traditional Energy Sources

Energy Sector Synopsis Report, 2006 7

Table 2.1: Sustainable fuelwood supply from Accessible/Reachable area in Nepal

Energy Sector Synopsis Report, 2006 8

Table 2.2: Accessible and Reachable areas of land use type

Accessible area in Reachable area in Reachable area in

Energy Sector Synopsis Report, 2006 9

Fuel wood Sources Yield (tons/ha.) Remarks

Energy Sector Synopsis Report, 2006 10

Fuel Wood Supply by Sources

No significant difference can be observed in the contribution of different landuse types in

Energy Sector Synopsis Report, 2006 11

Figure 2.1: Sustainable Fuelwood Production by Physiographic Region in Nepal, 2004

Fuelwood Supply Situation in Development Regions

Energy Sector Synopsis Report, 2006 12

Sustainable Fuelwood Production by Dev.Region in Nepal, Year 2004

Total Potential Supply equal to 6.47 million tons.

On-Farm Fuelwood Supply

Energy Sector Synopsis Report, 2006 13

Energy Sector Synopsis Report, 2006 14

2.1.2 Charcoal Supply

Energy Sector Synopsis Report, 2006 15

2.1.3 Agricultural Residue

Table 2.6: Potential production of Agricultural Residue, 2003/04

Energy Sector Synopsis Report, 2006 16

Supply Potential of Agricultural Residue by Development Region

Energy Sector Synopsis Report, 2006 17

Proportion of production by crops

Wheat 4.8% 2.5% 1.6% 2.3% 3.0%

Total Potential Supply = 15.26 million tones

Residue Production by Physiographic Region

Supply-Demand Balance of Agricultural Residue

Energy Sector Synopsis Report, 2006 18

Figure 2.4: Supply Potential of Residue by Physiographic Region, 2004

Wheat 4.6% 0.8% 8.9%

Total Potential Supply = 15.26 million tones

2.1.4 Animal Waste

Energy Sector Synopsis Report, 2006 19

Table 2.7: Supply Potential of Animal Waste, 2004/05