Bhutan Hydropower Project is First Cross-Border Initiative Under Clean Development Mechanism

A Bhutan hydro project supported by the Asian Development Bank and the governments of Austria and Japan was registered as the first cross-border initiative under the Clean Development Mechanism (CDM).

The 114-MW Dagachhu run-of-river hydropower project will promote cross-border power trade and reduce greenhouse gas pollution in the South Asia region, ADB reported. The hydro project will enable Bhutan to export clean hydroelectric power to India.

Aimed at encouraging developing nations to invest in greenhouse gas emission reduction projects, the CDM has been established under the United Nations Framework Convention on Climate Change (UNFCCC).

The International Hydropower Association recently released a policy statement on the Clean Development Mechanism, encouraging governments worldwide to raise the importance of the CDM in their agendas. The policy statement highlights the importance of hydropower CDM projects in reducing CO2 emissions.

“ADB is pleased that the Dagachhu hydropower project has been registered for CDM. It will encourage regional trade in clean and renewable energy while contributing to environmental protection,” said Thevakumar Kandiah, Director of ADB’s South Asia Department.

The Dagachhu power station is being built on the Dagachhu River in the southwestern district of Dagana and is expected to begin commercial production by the end of 2012.

Multiple international stakeholders, including Austria and Japan, are participating in developing the hydro project, ADB reported. The company established to manage the project is led by Bhutan’s state-run utility, Druk Green Power Corporation, and India’s Tata Power Company, reports indicate.

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