Energy shock from Strait of Hormuz drives Nepal’s shift to electric cooking

KATHMANDU: Escalating geopolitical tensions in West Asia, particularly disruptions around the Strait of Hormuz, are beginning to impact Nepal’s energy consumption patterns, with a partial shortage of cooking gas driving households toward electricity and sharply increasing power demand.

The shift is now visible in urban and semi-urban kitchens across Nepal, where consumers are increasingly adopting electric stoves amid uncertainty in LPG supply, signaling a structural change in energy usage behavior.

Electricity Demand Surges Amid Fuel Concerns

According to Hitendra Dev Shakya, Managing Director of the Nepal Electricity Authority (NEA), electricity demand has surged by 10–15% in the past month, with some areas witnessing spikes of up to 20%.

“This level of growth is unusual compared to the same period last year. The ongoing fuel uncertainty is pushing consumers toward alternative energy sources, primarily electricity,” Shakya stated.

Under normal summer conditions, Nepal’s electricity demand typically ranges between 2,500–2,600 MW. However, NEA now projects demand could rise to 2,800–3,000 MW, indicating an additional 400 MW pressure on the system due to the ongoing energy situation.

Crisis Also Seen as Opportunity

Despite the strain, NEA views the trend as a long-term opportunity to accelerate Nepal’s transition toward clean energy and electrification.

“If we manage this increased demand efficiently, consumers may continue relying on electricity even after the fuel situation stabilizes,” Shakya noted, adding that the authority is focusing on demand management and planning to further promote electric appliances.

Oil Supply Risks and Government Response

The Nepal Oil Corporation (NOC) has acknowledged partial LPG shortages in the market, though it maintains that overall import levels remain stable.

To mitigate potential supply disruptions, NOC is exploring contingency measures including:

Implementation of a vehicle rationing system (odd-even rule)
Promotion of electric cooking alternatives
Broader energy consumption management strategies
Power Supply Balancing Through India

To maintain supply stability, NEA is currently managing electricity through cross-border trade with India via the Indian Energy Exchange. While some agreements are due for renewal at the end of March, Nepal has received a verbal assurance of uninterrupted 24-hour electricity supply in April.

However, the outlook for May appears more complex. Nepal may receive electricity from India for approximately 20 hours daily, primarily during daytime (solar hours) and nighttime, with a potential 4-hour gap during evening peak demand.

NEA plans to offset this gap by operating domestic peaking hydropower plants, ensuring system reliability during critical hours.

Seasonal Relief Expected

Energy officials remain cautiously optimistic as river flows are expected to increase after mid-Baisakh (late April–early May), boosting domestic hydropower generation and easing supply constraints.

Strategic Shift in Nepal’s Energy Landscape

The ongoing global energy uncertainty, triggered by tensions in key oil transit routes, is accelerating Nepal’s shift toward electricity-based consumption, clean energy adoption, and reduced fossil fuel dependency.

For Nepal’s economy, this transition holds significant implications for energy security, import substitution, trade deficit reduction, and long-term sustainability, particularly as the country leverages its hydropower potential to navigate global supply shocks.