Kathmandu, July 24, 2025 - Nepal is poised to undergo a major energy transformation as it eyes scaling up its hydropower capacity from the current 3,000 megawatts to a projected 28,500 megawatts within the next decade. This ambitious push-estimated to require US$ 46.5 billion in public and private investment-comes with a strategic shift: harnessing surplus hydroelectricity to produce green hydrogen.
With the Government of Nepal officially recognizing hydroelectricity as a priority sector, energy experts see this as a critical juncture to diversify the nation’s energy portfolio, accelerate domestic industrial decarbonization, and expand clean energy exports.
In this context, a timely issue note titled “Green Hydrogen in Nepal: Unlocking a Sustainable Energy Future”, co-authored by Madhu Marasini and Prajol Joshi of the South Asia Watch on Trade, Economics and Environment (SAWTEE), outlines a compelling case for green hydrogen as a transformative solution.
The note highlights that green hydrogen-produced using renewable electricity to split water into hydrogen and oxygen-can serve as a clean fuel for transportation, fertilizers, steel, and even export markets. Given Nepal’s abundant hydropower potential, the transition toward green hydrogen offers an unprecedented opportunity to position the country as a regional leader in clean energy solutions.
Importantly, institutions like the Green Hydrogen Lab at Kathmandu University are already engaged in developing homegrown technologies and research capacity to support this transition, signaling a growing alignment between academia, policy, and investment.
“Green hydrogen has the potential to catalyze clean industrialization in Nepal, while contributing to regional decarbonization efforts,” the SAWTEE paper notes. It further recommends a supportive policy framework, investment incentives, and cross-border cooperation to fully realize this potential.
As South Asia grapples with energy security, climate challenges, and economic transitions, Nepal’s green hydrogen agenda could become a beacon for sustainable development in the region.
