Inviting applications for the SAREP Grants Annual Program Statement (APS) – FY2024. For more information click Here.
Opportunities: I. Request for Proposal (RFP) – Development of a web and desktop application for Cybersecurity Posture Assessment Tool (CPAT). For more information click here. Last date: June 19, 2024.      ||      II. Request for Proposal (RFP) – Enhancing NIYANTRAC - Energy Management Application for Indian Railways. For more information click here. Last date: June 26, 2024.

Objective One

The invention of electricity grids represents a pivotal technological advancement, transcending community boundaries and fostering international collaboration as countries partner to develop integrated electricity systems. Globally, approximately twenty regional electricity grid integration initiatives are at various stages of development and market integration currently. In any region, the development of Regional Electricity Markets (REMs) reflects the level of integration, which is strongly influenced and shaped by prevailing political, economic, social, regulatory, planning, and cultural factors. Countries have gradually overcome various challenges, deepened grid integration through Cross-border Electricity Trade (CBET) and come up with REMs.

South Asia (SA) region is one of the most vibrant and diverse regions in the world. It comprises 3% of the total world’s area, 21% of the world’s population and 5.21% (US$ 4.47 trillion) of the global economy, as of 2021. Access to reliable, affordable, clean, and sustainable energy is a high priority not only to support rapid economic growth and improved welfare of more than 1.8 billion population of the SA region but also to ensure energy and climate security in the region. Over the past few years, SA has experienced a sustained economic growth (average of ~ 6 %) that has reduced poverty and contributed to notable strides in health, education and other development indicators and in striving to achieve sustainable development goals.

In South Asia, with increased energy demand and importance of sustainable energy, enhanced regional energy cooperation is critical to boost regional energy security and overall climate-resilience in South Asian Energy Sector. Regional Energy cooperation among SA countries is a key pillar to enhance energy security and facilitate clean energy transition.

SA Region has tremendous hydro potential (~350 GW) and significant solar (~939 GW) and wind (967 GW) energy potential. While SA is endowed with large (> 350 gigawatts) hydropower potential, only around 18 percent has been exploited so far. Increased regional energy cooperation for sustainable exploitation of regional energy resources on a sustained basis among countries can bring economies of scale, strengthen electricity/energy sector financing capability, enhance competition, market development, improve sector efficiency and greening the South Asia Power Grid.

While the challenges faced by each country vary, there are a few common constraints including:

  • Varied level of policies, legal and regulatory frameworks among countries
  • Limited cross border transmission system interconnection
  • Limited clean and sustainable energy access posing a significant challenge to development and livelihoods
  • Economic constraints and burgeoning climate related challenges leading to increased electricity demand
  • Reliability and quality of electricity continues to be low, even as grid access has expanded
  • Relatively low per-capita consumption, with the potential to increase dramatically
  • Power generation mix dominated by coal and other fossil fuels such as gas and diesel
  • Large renewable potential has yet to be developed
  • Lack of regional power trading platform
  • Lack of Regional South Asia Regional Generation and Transmission Plan
  • Socio-political complexities including subsidies for agriculture and rural consumers, but high tariffs for commercial and industrial consumers, as well as governance challenges.

Regional inter-governmental institutions have provided enabling regional agreements for fostering electricity grid integration and CBET leading to a strong foundation. Increased cooperation between countries in the South Asia energy sector resulted in 18.1 terawatt hours (TWh) of CBET in FY2023, through various bilateral and government-to-government arrangements. However, CBET is dominated by trade between Bangladesh, Bhutan, India, and Nepal (BBIN) with majority of bilateral transactions currently between India-Bhutan and India-Bangladesh. While CBET started as early as the 1950s in the SA region, it is only in the last ten years that the region has witnessed a many-fold increase in CBET, from 1,400 MW in 2012 to 5273 MW in 2023. With an upsurge in cross-border transmission and interconnection, power trade is expected to increase to about 43.8 GW by 2040. With the One Sun, One World, One Grid (OSOWOG) initiative pioneered by the Government of India and Green Grids Initiative (GGI)-OSOWOG, the region will get interconnected beyond SA. Large scale cross border transmission needs to be developed to tap the large-scale solar potential.

SAREP, building on USAID’s past efforts like South Asia Regional Initiative for Energy Integration (SARI/EI), aims to boost cross-border energy trade in South Asia. This will enhance energy security, promote clean energy, and boost economic activity by improving energy access and creating livelihoods. SAREP is working on facilitating the development of regional power markets, improving coordination and planning, strengthening national and regional institutions, driving consensus on power trade, and institutionalizing supporting framework and mechanisms.

Program Steering Committee and Task Forces

Enhanced regional energy markets and integration activities are guided by a high-level regional program steering committee, the apex body providing overall strategic direction followed by three dedicated Task Forces (TF) to provide practical and concrete recommendations for expanding CBET in the region. Program steering committee members include senior-level officials from country governments, regional multilateral institutions, multilateral development banks and independent energy experts and diplomats. Task force members include country government nominated members from SA countries.

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Task Forces are envisaged to be the at the heart of SAREP’s CBET interventions. TF assist in generating evidence based informed recommendation through technical assessments/ studies* on CBET and building consensus. Focused, structured, consultative, and participative approach and continuous engagement is envisaged.

SAREP Task Force-1 on “Coordination of Policies, Legal and Regulatory Frameworks for CBET

The key objective of Task Force-1 (TF-1) is harmonization of policy, legal and regulatory issues for the fair allocation of costs and risks through conducive policies and legal and regulatory instruments, to create the enabling systemic conditions for a sustainable market for implementation and expansion of CBET projects.

The 11th Meeting of SAREP TF-1 convened in Colombo, Sri Lanka in October 2023. It marked a significant step towards fostering cooperation and collaboration among SA nations to enhance CBET through coordination/harmonization of policies, legal frameworks, and regulatory mechanisms. The key focus are:

  • Long Term Regional Cross Border Energy Policy & Regulatory Vision (RCEPRV) as a future outlook with a 25 to 30-year time horizon, in consultation with policy makers, regulators for long term sustainability of CBET based on common principles.
  • Developing Regional Dispute Settlement Framework, Mechanism, and associated procedure for Advancing CBET in South Asian Region.
  • Regional Policy and Regulatory Framework for Regional Electricity Market Monitoring and Oversight.

Read more about the Terms Reference of Task Force-1 here and 11th Meeting of SAREP Task Force-1 on ‘Coordination of Policies, Legal and Regulatory Frameworks for Cross Border Electricity Trade’ here.

SAREP Task Force-2 on “Enhancement of Transmission System Interconnections for Cross Border Electricity Trade”

The key objective of Task Force-2 (TF-2) is to advance Transmission Systems Interconnection and facilitate the implementation of these in SA for development of South Asian Regional Power Grid.

The 11th Meeting of SAREP TF-2 was held in Kathmandu, Nepal in February 2023 where participants shared respective country plans for strengthening domestic transmission system. The key focus are:

  • Regional Electricity Supply and Demand Scenario and Cross Border Electricity Trade (CBET) potential by 2043.
  • Pre-feasibility analysis of cross border electricity transmission for a few priority interconnections, to prioritize investments.
  • South Asia Regional Generation and Transmission Plan.

Read more about the Terms Reference of Task Force-2 here and 11th Meeting of SAREP Task Force-2 on ‘Advancement of Transmission System Interconnections for Cross Border Electricity Trade’ here.

SAREP Task Force-3 on “South Asia Regional Power Market for Market-based Electricity Trade”

The key objective of Task Force-3 is to create an enabling environment for the creation of a South Asia regional power market to accelerate market-based CBET transactions.

The 11th Meeting of SAREP TF-3 on South Asia Regional Electricity Market was organized in October 2023 to discuss the evolving nature of South Asia’s power market and means to deepen market-based power trade and advance electricity market integration. The key focus is :

  • Learnings from International Experiences on undertaking Electricity Market Reforms, its role in Electricity Market Integration, Development of Regional Electricity Market, and develop Regional Electricity Market Vision for South Asia.
  • Regional Electricity Market Design and South Asia Regional Power Exchange.

Read more about the Terms Reference of Task Force-3 here and 11th Meeting of SAREP Task Force-3 on ‘South Asia Regional Electricity Market’ here.

Key Interventions

SAREP is working to develop regional institutions to enhance energy co-operation and co-ordination in the region. Expanding work initiated under SARI/EI, regional forums relating to transmission utilities, system operators, electricity markets, regulators, distribution utilities, investments, and clean energy financing, amongst others have been initiated.

  • Institutionalization of Regional Parliamentary Forum on Regional Energy Cooperation - USAID/India, with Climate Parliament, is establishing a South Asian Regional Parliamentary Forum to engage parliamentarians in advancing energy cooperation, markets, and cross-border trade sustainably. In this context, USAID/India in partnership with Climate Parliament, organized a day long South Asian Parliamentarian’s Roundtable on Regional Energy Cooperation (REC) with participation of BBIN parliamentarians on November 8, 2022 at Sharm El-Sheikh, Egypt on the side-lines of COP27 to announce the Regional Parliamentary Forum. National level consultations followed in Bangladesh along with regional workshop and meetings with prominent Member of Parliamentarians including the Honourable Speaker of Bangladesh.
  • South Asia Think Tank Forum (TTF) Enhancing CBET and Regional Energy Cooperation - Through the South Asia Think Tank Forum (TTF) for regional energy cooperation, SAREP is working to enable the required CBET-related outreach and dissemination that will catalyze engagement with policymakers, media, and parliamentarians, bureaucrats, civil society, and citizens.
  • Establishing regional investment facilitation platform - South Asia Forum for Energy Investments (SAFEI) - USAID’s ‘Strategy Paper for Creation of South Asia Forum on Energy Investment (SAFEI) for Promoting Regional Energy Investment’ was launched by Sh. Pushpa Kamal Dahal, Rt. Hon’ble Prime Minister of Nepal, in Kathmandu on April 18 at the inaugural session of Power Summit, 2023. The vision of SAFEI is to become the regional centre of excellence for creating an investor friendly ecosystem for the development of sustainable regional energy projects and advancing cross border energy trade in SA. The forum promote regional energy investments in SA in a sustainable and cost-effective manner. The operational activities of SAFEI have been initiated.
  • Enhancing regional energy data ecosystem analysis through South Asia Energy Database (SAED) – SAREP is working on strengthening South Asia Energy Database and improving data acquisition systems of regional countries through API Annual Data Book. Technical assistance to Load Dispatch Center’s (LDC), Real Time Data Acquisition System (RTDAS), Management Information System (MIS) and Data Dissemination so as to enable LDC to operate the power system with enhanced level of safety, security, and reliability and to accomplish the CBET effectively and efficiently and facilitate seamless, automatic, and real time integration of the country’s energy/power data with the South Asia Energy Database (SAED).
  • Strategic advocacy for trilateral power trade (Nepal/Bhutan-India-Bangladesh).
  • Institutionalization of the South Asia Network for Integrated Power System Planning and Operation (SANIPO)/BIMSTEC Network for Integrated Power System Planning and Operation (BINIPO)
  • Enhancing Power Market-based CBET for Bhutan and Nepal through Power Trading Tools – SAREP provided customized technical assistance to Bhutan for meeting critical energy deficit requirements through imports from Indian power exchange platform. SAREP also developed Integrated Model for bidding, scheduling and DSM management and provided handholding support to Bhutanese stakeholders. They also supported imports of 590 GWh of electricity during 2022-23 and is working on developing advanced model for optimal bidding volume and price.

    For Nepal, SAREP developed Integrated Model for Bidding, Scheduling and DSM management for core group of stakeholders and provided handholding support to the stakeholders.

  • Preparing Bangladesh to participate in the regional power exchange – SAREP aided the creation of Bangladesh power exchange core group and prepared a guidance note and roadmap for participation in the power exchange. SAREP also undertook capacity building of the core group.

    The report on Roadmap for Bangladesh to participate in the Regional Power Market was released during a session at 'Towards a Resilient South Asia: Regional Climate Summit 2023', convened by the Climate Parliament on September 9, 2023. Jointly developed by USAID’s Bangladesh Advancing Development and Growth through Energy (BADGE) and SAREP, the report outlines the steps necessary for Bangladesh to participate in the Indian power market.

  • Integrated power exchange Transaction Model for Dispatch, Scheduling & Bidding (IMDSB) - The IMDSB module is a cloud-based semi-automated tool to aid power sector stakeholders in integrated management of supply-demand in coordination with cross-border power trading through the Power Exchange (PX). SAREP has developed a customised Integrated Model for Dispatch Scheduling & Bidding (IMDSB) for Bhutan and Nepal stakeholders that will enable them to make more optimal decisions for participating in electricity spot markets.
  • River Inflow Forecasting and Measurement System for Chhukha Hydropower Plant - Development of a Hydropower Forecasting System Framework and Implementation of a Pilot Project for Hydropower Optimization in Bhutan
  • Sophisticated Web-based Power Exchange Transactions Software Tool - Development of Python based web module for scheduling & trading through Cross-Border Power Exchange Market.
  • Knowledge support to SAFIR for regulatory cooperation - Considering the long-term nature, scale of change and ramification of clean energy transition, there is a need to enhance the electricity regulatory ecosystem and develop coordinated and complementary regulatory framework among SA regulators. In this context and to explore and discuss critical issues and long-term prospects for regulation of the dynamically evolving power system in the region, the first edition of the SAFIR-SAREP Regional Regulatory Dialogue on “Enhancing Electricity Regulatory Ecosystem for Accelerating Clean Energy Transition and Achieving Net Zero Ambitions in the South Asia Region” was organised on September 18, 2023. In-depth discussion among SAFIR members, electricity regulators and international experts on the importance of regional cooperation for facilitating sustainable energy transition took place in the dialogue. Read more about the dialogue here.

    The Annual SAFIR-SAREP Conference on ‘Deepening Cross Border Electricity Trade and Regional Electricity Market Development for Sustainable Energy in the South Asia Region’ was conducted in New Delhi, India on March 2-3, 2023. The inaugural was followed by four working sessions spread over two days, where senior officials and experts from public and private sectors in the power market in South Asia shared their views. They discussed topics such as transmission infrastructure, conducive policies, transition strategies, and innovations, technologies etc. that would be required for increased regional energy trade. Read more about the annual SAFIR-SAREP conference here.

    SAREP is also providing technical and knowledge support to SAFIR Working Group (SWG) on “Regulatory Cooperation to Facilitate Knowledge sharing, addressing cross cutting Energy/Electricity Regulatory Issues and Capacity Building in South Asia” on regulatory pathway for electricity/energy exchange, framework for regional ancillary service market, South Asia Energy Sector Training and Capacity Building program on energy regulation for Energy Cooperation and exchange of electricity in South Asia, regulatory newsletter, and regional regulatory compendium. Read more about the technical and knowledge support to SAFIR Working Group (SWG) here.

    SAREP is also providing technical and knowledge support to the SAFIR Joint Working Group (JWG) “to study, formulate and recommend for facilitating power trade development in SA on harmonization of rules and common minimum grid code. The Common Minimum Grid Code for SA lays down the common minimum rules, guidelines, and standards to be followed by various SA country participants in the system for CBET, while operating the power system, in the most secure, reliable, economic, and efficient manner. Read more about the technical and knowledge support to JWG here.

  • Institutional support to BIMSTEC Energy Center – SAREP is supporting BIMSTEC Energy Center on
    • BIMSTEC Regional Energy Database
    • BMSTEC Energy Perspective 2040
    • BIMSTEC-comprehensive plan for regional energy cooperation (BIMSTEC-CPREC) - significant
    • Website, newsletter, knowledge sharing library, joint workshops, etc.
  • Undertaken market assessment for Nepal Power trading entities.
  • Stakeholder consultations with regional beneficiaries conducted and consensus building.
  • Explore the creation of new power trading entity and strengthen power trading functions.
  • Joint Workshop on Prospects of Clean Energy Transformation and Role of Coordinated Generation and Transmission Planning for Optimal and Sustainable Cross Border Energy Trade in South Asia.
  • Fostering Coordinated, Complementary Regional Generation and Transmission Planning for Optimal and Sustainable Cross Border Energy Trade (CBET) in South Asia.
  • Coordinating national plans for power generation and transmission, along with developing regional infrastructure, will strengthen Regional Energy Cooperation (REC). This will bring cost savings, improve financing for the electricity sector, increase competition, and make the South Asia Power Grid (SAPG) greener. Overall, this will accelerate the shift to cleaner energy, enhance energy and climate security, and promote economic development in South Asia.
  • Peer Exchange Programs conducted for Cross Border Energy Trade and Powers Markets for stakeholders from Bhutan and Bangladesh.
  • Conducted technical trainings and knowledge sharing workshops on power trade, markets (day ahead, real time market), DSM etc.
  • International study tour for PSC and Task Force Members- “Developing Regional Power System, Electrical Integration and Regional Institutions in Central America: Strategic, Policy, Regulatory, Institutional, Technical, Operational and Market aspect of SIEPAC (Central American Electrical Interconnection System).
  • International regulatory study tour on regional power market regulatory governance, market design and development – regional power markets/pools in North America.
  • SAREP facilitated 2772 MUs (1858 Mus for Bhutan & 914 MUs) of power exchange CBET through Indian Power Exchange for Bhutan and Nepal.
  • Institutionalization of Regional Parliamentary Forum at COP27, Sharm-el-Sheikh, Egypt.
  • Supported development of Common Minimum Grid Code for CBET under SAFIR aegis.
  • SAREP supported Bhutan and Nepal’s participation in Indian Power Exchange.
  • Initiation of investment mobilization platform – SAFEI.
  • SAREP-SAGE RIS partnership to promote, initiate and facilitate effective policy dialogue and capacity building on a bilateral, sub-regional and regional basis for energy and related issues.
  • Institutional technical assistance and capacity support to regional institutions like SAFIR and BIMSTEC Energy Centre.