Renewable Energy in Bhutan Beyond Hydropower

Bhutan's energy identity has long been defined by hydropower: its rivers, fed by Himalayan glaciers, generate electricity that the country exports to India in quantities that make hydropower receipts the single largest source of government revenue. Yet this dependence carries risks that have grown more visible as climate change alters glacial melt patterns, as seasonal variation in river flows creates dry-season deficits, and as neighbouring demand cycles become less predictable. Successive governments have acknowledged that a resilient energy future requires diversification into solar and wind, whose generation profiles are largely complementary to hydropower — producing most energy precisely during the dry months of December to March when river flows and hydropower output are at their lowest.

Potential and National Targets

Bhutan's theoretical renewable energy potential extends well beyond its rivers. According to the IRENA Renewables Readiness Assessment (2019), the country possesses approximately 12 GW of exploitable hydropower potential alongside 12 GW of solar potential and 760 MW of wind potential. These figures represent what is physically achievable given terrain and irradiance data; realistically accessible capacity under current economic and infrastructure conditions is considerably lower, but the resource base is substantial relative to the country's scale.

The National Energy Policy 2025 set a target of 25 GW total installed capacity by 2040 — 20 GW from hydropower and 5 GW from solar and wind combined. Separately, the government has established interim goals of 500 MW of solar energy by 2025 and 1,000 MW by 2030. These are ambitious targets for a country that had virtually no utility-scale solar capacity as recently as 2024, but the trajectory is supported by steeply falling photovoltaic costs globally and by growing domestic electricity demand as the economy industrialises and electric vehicle adoption expands.

The Sephu Solar Project

The Sephu Solar Project in Wangdue Phodrang Dzongkhag is the landmark development in Bhutan's solar ambitions. Located on approximately 44 acres of state-owned land near the town of Wangdue Phodrang in the centre of the country, the project reached a major milestone on 19 July 2025 when Phase I (17.38 MWp) was commissioned — making it Bhutan's first utility-scale solar photovoltaic power plant. A second phase adding 5 MW was scheduled for completion later in 2025, bringing total installed capacity to 22.38 MWp.

The project was financed through a combination of a USD 10 million grant and a USD 8.26 million loan from the Asian Development Bank (ADB). The Druk Green Power Corporation, Bhutan's state hydropower operator, manages the facility. Alongside the Sephu project, the National Solar Rooftop Programme recorded over 5,000 households and businesses installing rooftop panels in 2024 — a figure that reflects growing cost-competitiveness of distributed solar even in a grid-connected country.

Wind and Emerging Sources

Wind energy development remains at an early stage. Bhutan's mountainous topography creates highly localised wind patterns that require detailed site assessment before commercial development is viable. The government has commissioned wind resource mapping in several highland areas, and pilot installations at off-grid sites have demonstrated technical feasibility. However, grid integration, transmission access, and the relatively high cost of mountain-terrain wind installation have slowed progression from assessment to construction.

Biogas programmes, primarily in rural areas, convert animal waste into cooking fuel and small-scale electricity for households beyond the grid. These village-scale installations reduce dependence on firewood — a driver of deforestation — while providing a clean cooking fuel that improves indoor air quality. The Bhutan Foundation and international development partners have supported biogas adoption in agricultural communities, though national data on total installed biogas capacity remain limited.

See also

• Solar Energy in Bhutan
• Ministry of Energy and Natural Resources (Bhutan)
• Chukha Hydropower Project
• Punatsangchhu-I Hydropower Project

References

1. "Bhutan Commissions First Utility-Scale Solar Plant." PV Magazine, July 2025.
2. "Sephu Solar Farm's Capacity Enhanced to 22.38 MW." Druk Green Power Corporation.
3. "Renewables Readiness Assessment: Bhutan." IRENA, December 2019.
4. "Renewable Energy Sector Grows in 2024." Business Bhutan.
5. "Delivering Clean Energy through Solar Power in Bhutan." Asian Development Bank.