Sustainable Hydropower Development Policy 2021 to Guide Bhutan's Hydropower Development

21 April 2021

The Ministry of Economic Affairs of the Government of Bhutan launched the Sustainable Hydropower Development Policy (SHDP) 2021 on 21 April 2021, led by Mr. Tengye Lyonpo, Minister for Economic Affairs. The policy notes, “the SHDP 2021 is expected to guide the overall development of Bhutan’s abundant hydropower resources in consonance with national economic development goals, other relevant policies and laws, and more importantly to benefit the nation and achieve the larger aspirations of its people for peace, prosperity, and happiness.”

Hydropower has become the main backbone and driver of Bhutan’s economy over the last four decades, notes the news release. Development of hydropower to its present installed capacity of 2,326 megawatts and commensurate development of industries and nationwide electrification have enabled the Bhutanese people—even those in the remotest regions of the country who now have access to clean, reliable and affordable electricity—to reap huge socio-economic benefits.

SHDP 2021 seeks to enhance energy security, develop value chains based on available clean energy, and generate export revenues. Its objectives include enhancing cross border trade of electricity by participating in the evolving and innovative market mechanisms; securing and/or mobilizing funds for sustainable development of hydropower projects; developing hydropower projects in a regionally equitable manner; creating enabling eco-system for participation and engagement of Bhutanese in the construction of hydropower projects, including providing goods and services; and promoting research, demonstration, and development and creating centers of excellence and knowledge hub in the region for the entire value chain of hydropower.

The Hydropower Development Strategy 2017, approved in 2019 as Bhutan’s strategic road map for hydropower development, recommended a review of the SHDP 2008 and the Electricity Act 2001. The SHDP approved in 2008 was guided by objectives of accelerating hydropower development and diversifying investments in the sector. Lessons learned from hydropower development in Bhutan over the years, changes in national circumstances, priorities, and the evolving aspirations of the Bhutanese people have compelled the review of the SHDP 2008, noted the news release.

Read the SHDP 2021.


Related links:

News release

New hydropower policy seeks trilateral and regional cooperation

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