The Bhutan We Think We Know

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FAQ

How much of Bhutan's economy is really hydropower?

Hydropower is the backbone of Bhutan's economy — its largest single GDP contributor, its dominant export, and the main funder of the national budget. As of 2025 the state generator, DGPC, ran about 3,632 MW of installed capacity (only around 10% of the country's viable potential), and 2025 generation jumped 35.8% to about 15,803 GWh after Punatsangchhu II came online. But hydropower debt is also the dominant sovereign liability — roughly 60% of total public debt — which makes the sector simultaneously Bhutan's greatest asset and its most concentrated risk.

The scale is easy to state and hard to overstate. Hydropower is the single largest contributor to GDP, the dominant source of foreign exchange, and the primary mechanism through which the government funds itself.

Measure (2025)Figure
Installed capacity~3,632 MW (≈10% of viable potential)
Generation~15,803 GWh (+35.8% on 2024)
Exports to India~7,925 GWh
Domestic consumption~9,160 GWh — first year domestic use exceeded exports
Peak demand1,477 MW (Nov 2025), up from 336 MW in 2015

The fiscal role. Via DHI, energy anchors the roughly 40% of all national revenue the holding company supplies; the generator DGPC is the largest single contributor to DHI’s group profit.

The concentrated risk. Hydropower debt is around Nu 172 billion — about 60% of external debt — and total public debt stood near 90% of GDP in early 2026 (87.8% at March on the official RMA series). Because generation depends on rainfall, a single drought (2018) cut output by roughly 866 GWh and DHI group profit by 31%. No other sector can offset a bad monsoon.

The new twist. New round-the-clock industrial loads — especially crypto mining — now account for a major share of domestic power demand, which is why the country, for the first time, uses more of its own electricity than it sells abroad.

For the paradoxes underneath the numbers, see #1 the green kingdom that imports brown power, #2 the export dollar that takes the Delhi detour, and #67 the same money, counted four ways — plus the closed loop.

Primary sources