Kathmandu: Taxi driver Surendra Parajuli’s decision to buy an electric cab would have been unthinkable a decade ago, when chronic power cuts left Nepalis unable to light their homes at night.

But a dam-building spree has led to dirt-cheap energy prices in a landlocked Himalayan republic otherwise entirely dependent on fossil fuel imports, meaning the switch has put more money in his pocket.

“It has meant huge savings for me,” Parajuli, the proud new owner of a battery-powered and Chinese-made BYD Atto 3, told AFP here.

“It gives 300km in a single charge and costs me a tenth of what petrol does. And it’s environmentally friendly.”

Kathmandu is ground zero of an incipient transport revolution set to see the clapped out cars that clog its traffic-snarled streets make way for emissions-free alternatives.

More than 40,000 electric vehicles (EVs)are on the roads around the mountainous country, according to official estimates - a small fraction of the 6.2 million motor vehicles currently in service.

But demand is insatiable: more than a quarter of those vehicles were imported in the 12 months to July, a near-threefold increase from the previous year.

Neighbouring China, now the dominant player in EVs globally, is supplying nearly 70% of the market.

“EVs are genuinely suitable for Nepalis,” Yajya Raj Bhatt, a prospective buyer at an electric vehicle motor show, said.

“Before, we had to rely on petrol cars, but now we can drive independently.”

More than four in five Nepalis did not have access to electricity at the turn of the century, according to the International Energy Agency.

But rapid investment in dams, which generate 99% of Nepal’s baseload power, has transformed the energy grid since.

Hydropower output has increased fourfold in the past eight years, according to government figures, while 95% of the population now has access to electricity.

The country has already signed deals to export surplus power to coal-dependent India and has its sights set on future revenues by raising its current 3,200MW of installed power generation capacity to 30,000MW over the next decade.

Making electricity universal, and universally cheap, has the potential to jumpstart an economy that has historically depended on remittances from Nepalis working abroad.

Kulman Ghising of the Nepal Electricity Authority said the benefits have already been felt by setting the favourable conditions for widespread EV adoption.

Nepal is entirely dependent on imports from India to meet its fossil fuel needs, imposing additional costs on motorists, but Ghising said curbs on demand had saved the country around US$224mil.

“The EVs have great potential for us,” he added.

“EVs in India and Bangladesh need to depend on coal, but in Nepal, it’s fully green energy,” he said.

Road transport accounts for just over 5% of greenhouse gas emissions and has fuelled a worsening air pollution crisis.

Kathmandu was this year listed as one of the world’s most polluted cities for several days in April.

Experts said that getting more petrol-powered vehicles off the road would be a major step towards alleviating that problem.

EVs are subject to much lower import duties, and the government expects them to help Nepal reach its ambitious aim of becoming a net-zero greenhouse gas emitter by 2045.

Its plan aimed to have EVs account for 90% of all private vehicle purchases by the end of the decade.

But not everyone is convinced that the advent of Nepal’s EV boom portends an environmentally friendly future.

Nepal’s ambitious hydropower plans are contentious, with campaigners warning that the construction of new dams risk damaging sensitive ecological areas.

 - AFP