FAQ
Why does Bhutan's industry pay less for electricity than India does?
Bhutan's 23 large industrial customers pay a domestic tariff of Nu 1.60 per unit — less than the net price Bhutan actually retains from exporting the same hydropower to India (about Nu 0.60–1.00 per unit after debt service is stripped out), and among the cheapest industrial electricity tariffs in the world. In effect, the country gives its own heavy industry a deeper discount than it earns from its single largest export customer.
The headline export price India pays sounds higher than what Bhutan keeps. After the debt service on the loans that built the dams, Bhutan’s net retention falls to roughly Nu 0.60–1.00 per unit — below the Nu 1.60 its own industrial users are charged. On a fully-loaded global basis, that industrial rate is among the lowest anywhere.
So the cross-subsidy points in an unexpected direction: a tiny set of large industrial consumers receives some of the cheapest power in the world, while households face the larger proposed increases. The structure is laid out in Paradox #51 and Paradox #64.