First BIMSTEC Energy Ministers’ Conference
4th October 2005, New Delhi
Speech of H.E. Lyonpo Yeshey
Minister for Trade & Industry, Bhutan

Your Excellency Shri Priya Ranjan Das Munsi, Minister for Water Resources, Government of India, Hon’ble Energy Ministers of BIMSTEC Member Countries, Distinguished delegates, Ladies and Gentlemen.

I am delighted to be here in New Delhi to attend the first BIMSTEC Ministerial Energy Conference. On behalf of my delegation I would like to thank the Government of India for the excellent arrangements and the warm hospitality provided to us. I take this opportunity to commend the Government of India in taking this initiative to host this important conference.

The world today is going through a severe energy crisis. The mismatch between energy supply and energy demand is ever increasing and the price of oil has reached unaffordable levels. On the other hand, our unsustainable energy consumption pattern is certainly to be blamed for the accelerated global warming and climate change phenomena. Our economies are going through difficult times with insufficient energy available not only for industries but also for basic needs. We are therefore faced with many development challenges- the challenge of poverty alleviation, the challenge of providing sufficient, affordable and sustainable energy and the overall challenges of meeting the Millennium Development Goals (MDGs). It is in the backdrop of this situation that we are gathered here today to put our thoughts and ideas together to work for a common goal of providing sustainable energy supply to meet the increasing demand in our countries. I am sure that our collective efforts will go a long way in finding appropriate and sustainable solutions to overcome this never ending problem.

Our region is home to more than a billion people many of whom do not have access to any modern form of energy. Yet we live in a region that is blessed with huge natural resources. Our countries together possess great potential reserve of energy resources in the form of rivers, coal, forest, oil and natural gas. There is tremendous scope for our region to achieve energy security if we are able to tap our resources in a collective manner for the overall benefit of the region. There is ample opportunity for us I to overcome the energy shortages by relying on each other’s stock of energy potential rather than overly depending on imports from outside.

In Bhutan, our source of electricity is almost 100% hydro while we rely on imported oil mainly for our transport needs. We also have a large biomass resource and wood continues to be a major source of energy for meeting the cooking and heating needs. Bhutan’s energy potential, however, lies in its vast hydropower resource. The large forest coverage not only provides catchment for conserving the water resources but is also a source of renewable biomass energy for meeting the primary needs of most of our people especially in the rural areas.

I am happy to note that in the Senior Energy Officials’ meeting held yesterday, it has been recognized that hydropower will playa dominant role in achieving energy security. Bhutan has an estimated hydropower potential of 30,000 MW and so far only 468 MW of this potential has been harnessed. By the end of 2006, we would have developed about 1488 MW, which is just 5% of the total potential. Thus there exists immense opportunity for harnessing the hydro potential for meeting the future energy needs of Bhutan and the region as well.

Bhutan’s ability to harness the hydropower resources has been made possible because of the close and friendly ties with our neighbour, India. India has been the lead donor in providing both technical and financial assistance to develop the numerous hydropower projects in Bhutan. The relationship developed in the hydropower sector has been a win-win situation for both the countries. The cooperation with India in the field of hydropower has been lauded as a success story and as a model for bilateral cooperation. India has a huge power shortage while Bhutan has a large hydropower potential and this complements our sustained efforts in economic cooperation for mutual benefits.

Hydropower as a clean renewable source of energy has two important roles to play in the socio-economic development of Bhutan:

1) To provide safe, reliable, sufficient and affordable electricity for domestic consumption including industrial use.
2) As an industry for earning revenue from export of hydroelectricity thereby providing the much-needed capital to finance social projects and achieve economic self-reliance.

While in the past, primary focus had been to address the urgent need of electricity services in schools, hospitals, government offices and urban areas, greater focus is now being given to rural electrification.

Like most countries in our region, we also have a long-term vision to provide electricity for all Bhutanese people by the year 2020. To achieve these targets, we have a Hydropower Master Plan and we are currently working on a Rural Electrification Master Plan to chart the way forward. Rural Electrification (RE) is a challenging task as it is overly expensive and physically difficult in a land-locked mountainous terrain. Through the BIMSTEC Energy cooperation program, we hope to find sustainable solutions to achieve this ambitious electrification target.

Rural electrification though very expensive, is an undeniable necessity for the common people. Rural electrification leads to better health, improved performance by students, greater income generating opportunities, higher productivity and generally improvement in the quality of life of the common people. Provision of affordable electricity to our people has significantly reduced pressures on the forest, which in turn is very important for the conservation of the natural environment and protection of catchments areas. This helps to stabilize river flows for enhanced power generation and benefit not only Bhutan but also the adjoining lowlands in India and Bangladesh which are prone to frequent flooding as a result of rainfall and erosions in the mountains.

Excellencies, ladies and gentlemen, we must learn and share experiences, best practices and success stories in achieving the national energy targets and goals for providing sustainable energy services to the people. We must promote and encourage energy trade and cooperation among our nations. While some of our countries are endowed with renewable resources such as hydropower, biomass, wind, solar etc. others have fairly large stocks of coal and gas reserves. Collectively, our strategies should be to work together to develop our own energy pools to meet our energy needs and resort to imports from outside the region only if necessary. The outflow of funds that is spent on import of energy can remain within our countries and can be better utilized for priority developmental activities for improving the socio-economic conditions of our people. Energy conservation and technology efficiency improvements are other avenues where opportunity exists for us to work together.

We must, in our efforts to meet the increasing demand for energy, ensure that it is not at the expense of our environment. Extensive use of fossil fuel has created almost irreversible impact on our environment. Global warming and climate change are major concerns and even in a small country like Bhutan where in spite of a successful protection of the environment, signs of climate change are becoming visible. Hence in our collective efforts of providing sufficient, reliable and affordable energy services to our citizens, we must ensure that it is sustainable and not at the cost of future generations. The Kyoto protocol and the Clean Development Mechanism are some of the ways in which Member countries could cooperate in the energy sector in a responsible manner. The CDM provides opportunity not only to mitigate green house gas emissions but also help sustainable harnessing of energy resources to meet the growing demand for electricity through replacement of fossil fuel by clean energy such as hydropower.

Bhutan’s rivers are generally in deep valleys and the power projects are mainly run of the river schemes with minimal impact on human settlement, upstream submergence and environment.

In compliance of the BIMSTEC charter, our countries have agreed to promote sustainable and optimal energy utilization through development of new hydrocarbon and hydropower projects, interconnection of electricity and natural gas grids, energy conservation, and renewable energy technologies. I am hopeful that our meeting here today will provide the necessary stimulus and political will to set the direction for enhancing energy cooperation in the region.

Insufficient and unreliable supply of energy is already one of the most serious bottlenecks to socio-economic development and its solution calls for global and regional cooperation. BIMSTEC is moving in the right direction by focusing on this common problem of the member countries. I am confident that we can collectively address this problem and provide affordable and reliable energy for our people.

Thank You and Tashi Delek.

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