A Summer Sultan, a Winter Supplicant

The full numbers

Bhutan sits at the headwaters of the Brahmaputra basin. Per-capita hydropower potential is among the highest globally — roughly 46,000 kWh per person per year of techno-economic capacity. Installed capacity (2025): 3,632 MW, or ~10% of potential. But hydropower is heavily seasonal. In dry months (December–April), plants run at 25–35% of nameplate capacity because water flow is rainfall- and snowmelt-driven. Peak demand has nearly quadrupled since 2020 (375 MW → 1,477 MW in November 2025), now exceeding dry-season available generation. The arithmetic:

• 2024 lean-season imports from India (IEX): 1,406 GWh
• 2025 lean-season imports: 1,102 GWh (PHP-II commissioning partially closed the gap)
• At typical IEX clearing prices of INR 4–6/kWh: roughly Nu 5–7 billion per year flowing back to India during winter months
• Net effect: hydropower exports earn USD 200M+ annually, but a meaningful chunk flows back the other way to settle lean-season imports The technical reason is the absence of storage. Bhutan’s hydro fleet is mostly run-of-river — it generates what the river gives at that moment, with no reservoir to bank wet-season surplus for dry-season use. The pumped-storage solution (Gongri-Jericho, 1,800 MW) is still in DPR phase; realistic commissioning is mid-2030s.

Imagine this

In December in Thimphu, the temperature drops below freezing. A schoolteacher turns on her water heater at 6 AM, makes butter tea, and gets ready for the day. The electricity warming her water came in part from the Indian Energy Exchange via the Birpara–Malbase tie line — purchased on yesterday’s day-ahead auction at INR 5.20/kWh. She doesn’t know this. Nor does her colleague in Punakha. Nor does the gewog officer in Lhuentse turning on his desk lamp. Bhutan is silently absorbing 1,000+ GWh of Indian electricity each winter — power they were used to selling to India just five years ago. The reversal is not because Bhutan ran out of generation potential. It is because (1) domestic demand grew faster than expected, (2) hydropower output is seasonally variable, and (3) the country did not build the storage infrastructure that would have flattened the curve.

Where this came from

Bhutan’s hydropower fleet was designed as an export industry. Every dam was built to push wet-season throughput south to India and earn rupees. Domestic load was small (~500 MW peak in 2010), so seasonal generation patterns worked. Pumped storage was never financed because the export model didn’t need it — wet-season surplus went to India, dry-season demand was small enough to manage.

PPA structures locked in maximum-export framing for 30 years at a time. That model has now been overrun by domestic demand growth. The country has 3,632 MW of “installed capacity” but only ~1,000–1,200 MW reliable in dry months — against 1,477 MW peak demand.

Why this matters now

The lean-season deficit is structural, not transient. As industrial demand continues to grow, the dry-season gap widens — projected to reach 600–800 MW by 2026 and 900+ MW by 2027. Lean-season imports could reach 2,000+ GWh/year — Nu 8–12 billion of import bill annually — money flowing back to India that partially cancels Bhutan’s hydropower export earnings.

Pumped storage is the critical infrastructure. The DPR phase has been moving slowly. Every year of delay means another Nu 5–12 billion of avoidable lean-season imports.

What it should be

• A hydropower system designed for both generation AND storage.
• Pumped storage commissioned by 2032, not 2035+.
• Reservoir-based projects prioritized over additional run-of-river.
• The 13th FYP includes Gongri-Jericho pumped storage in DPR phase — accelerated financing (multilateral support; not waiting for traditional bilateral cycles) could move commissioning forward 3–5 years.

How others do it

• Norway — similar hydro abundance with extensive reservoir storage; near-zero seasonal imports despite massive winter heating loads
• Iceland — 100% renewable; geothermal + hydro complement; no seasonal imports
• Quebec, Canada — vast reservoirs (Manicouagan, La Grande) enable year-round dispatch; net exporter year-round
• Switzerland — pumped storage built into alpine hydro from the 1950s; flattens seasonal curve
• Costa Rica — diversified renewable mix (hydro + geothermal + wind + solar) hedges seasonality
• Bhutan: 3,632 MW installed but ~1,100 MW dry-season reliable; pumped storage 1,800 MW still in DPR phase

The question we should be sitting with

If we generate electricity for the world’s largest grid (India’s) but cannot keep our own taps warm in winter, what does that say about how we designed the system? Did we build dams to sell electricity, or to power Bhutan?