India, Bhutan discuss hydropower cooperation and transmission planning
Bhutan is making progress in expanding its hydropower capacity through recent projects and international cooperation. Updates include grid synchronization, new agreements, and future planning efforts.
3 min read
Bhutan is actively developing its hydropower resources with several projects making significant progress. These efforts are part of the country’s goal to boost renewable energy production and strengthen cooperation with neighboring India and private companies.
Recently, two units at the Punatsangchhu–II Hydroelectric Project were successfully connected to the national power grid. On December 17, 2024, Units 1 and 2, each with a capacity of 170 megawatts, were synchronized with the Indian power grid. This was an important step in increasing Bhutan’s energy output.
A few months later, on August 19, 2025, more progress was reported at the same project. Unit 5, also with a capacity of 170 megawatts, was synchronized with the grid. These developments are part of ongoing efforts to maximize hydropower production.
In addition to these projects, Bhutan has entered into new agreements to develop more hydropower capacity. On May 8, 2025, Bhutan’s Druk Green Power Corporation signed a memorandum of understanding with Adani Green Hydro Ltd. The partnership aims to develop 5,000 megawatts of hydropower projects in Bhutan. This agreement reflects a strong interest from both the government and private companies in expanding renewable energy infrastructure.
Further plans for the future include discussions on optimizing energy output and planning transmission networks. On February 3, 2026, Bhutan’s Minister of Energy and Natural Resources, Lyonpo Gem Tshering, met with Indian officials, including the Union Power Minister and Minister of State for Power. The discussions focused on ways to improve power generation from the Punatsangchhu–II Hydroelectric Project and to plan transmission infrastructure developments up to the year 2040.
Despite these positive steps, several key projects and plans remain in the development phase. As of 2026, there has been no official confirmation regarding the commissioning of Unit 6 at the Punatsangchhu–II project. Similarly, the large 5,000-megawatt hydropower projects under the Memorandum of Understanding are still underway, with no confirmed completion date.
Other important projects, such as the Punatsangchhu–I Hydroelectric Project and the Sankosh Hydropower Project, have not yet been officially completed or confirmed by authorities. Additionally, detailed plans for the transmission infrastructure up to 2040 are still under discussion, indicating ongoing planning efforts.
India has also shown support for Bhutan’s hydropower development. On November 12, 2025, India extended a line of credit worth 4,000 crore Indian Rupees to Bhutan specifically for hydropower projects. This financial help aims to support Bhutan’s energy growth and infrastructure development.
These projects and collaborations highlight Bhutan’s focus on renewable energy, especially hydropower, as a way to generate electricity and foster regional cooperation. The progress in grid synchronization and new agreements suggests that Bhutan is on track to increase its energy capacity, but many projects are still under development. The future of Bhutan’s hydropower expansion will depend on maintaining successful collaborations and completing planned projects.
