ABSTRACT
Nepal’s energy economy reflects the least developed status of the country. Traditional biomass energy sources, chiefly woodfuel, constitute over 90 per cent of the total energy supply: consumption of commercial fuels at 23 kilograms of oil equivalent per head in 1986 is amongst the lowest in the world. Despite such low levels of commercial energy consumption, energy imports – mainly petroleum products – accounted for 25 per cent of merchandise export earnings in the same year. Nepal has an enormous hydro-electric potential of about 85,000 megawatts, 20,000 megawatts of which is economically exploitable. At present only a small fraction of this potential (160 megawatts) is exploited. It is unlikely that electricty will provide an alternative to biomass energy sources because of high capital costs, the lack of a comprehensive electricity grid system and limited demand from a poor peasant population, unable to afford either the appliances or the tariffs.
