𝐅𝐨𝐬𝐬𝐢𝐥 𝐅𝐮𝐞𝐥 𝐈𝐦𝐩𝐨𝐫𝐭𝐬 𝐒𝐮𝐫𝐠𝐞 𝐃𝐞𝐬𝐩𝐢𝐭𝐞 𝐇𝐲𝐝𝐫𝐨𝐩𝐨𝐰𝐞𝐫 𝐁𝐨𝐨𝐦

…𝒂𝒏𝒏𝒖𝒂𝒍 𝒓𝒆𝒑𝒐𝒓𝒕 𝒔𝒉𝒐𝒘𝒔 𝒓𝒆𝒄𝒐𝒓𝒅 𝒆𝒍𝒆𝒄𝒕𝒓𝒊𝒄𝒊𝒕𝒚 𝒐𝒖𝒕𝒑𝒖𝒕 𝒂𝒍𝒐𝒏𝒈𝒔𝒊𝒅𝒆 𝒂 𝒔𝒉𝒂𝒓𝒑 𝒓𝒊𝒔𝒆 𝒊𝒏 𝒑𝒆𝒕𝒓𝒐𝒍𝒆𝒖𝒎 𝒊𝒎𝒑𝒐𝒓𝒕𝒔, 𝒆𝒎𝒑𝒉𝒂𝒔𝒊𝒛𝒆 𝒕𝒉𝒆 𝒄𝒉𝒂𝒍𝒍𝒆𝒏𝒈𝒆 𝒐𝒇 𝒃𝒂𝒍𝒂𝒏𝒄𝒊𝒏𝒈 𝒄𝒍𝒆𝒂𝒏 𝒆𝒏𝒆𝒓𝒈𝒚 𝒈𝒂𝒊𝒏𝒔 𝒘𝒊𝒕𝒉 𝒇𝒖𝒆𝒍 𝒅𝒆𝒎𝒂𝒏𝒅.

By Kinzang Lhamo

Bhutan, long celebrated as a global environmental leader, experienced a sharp rise in fossil fuel imports in 2024 despite generating record amounts of clean electricity, official data show. The Annual Environmental Accounts Statistics 2025 reports that the country produced more than 13,131 gigawatt-hours (GWh) of electricity last year, exporting nearly 42 percent, while its reliance on imported petroleum products climbed sharply.

Electricity generation rose 17.69 percent compared to 2023, with nearly 89 percent produced domestically, reaffirming Bhutan’s status as a hydropower-rich nation. Yet the expansion of renewable energy has not slowed the rising demand for fossil fuels. In 2024, the country imported 192,614 kiloliters of diesel and 71,657 kiloliters of petrol, increases of 24.80 percent and 28.40 percent year-on-year respectively. Fossil fuels now account for 22.89 percent of total energy consumption, highlighting growing dependence despite abundant clean electricity.

The transport sector remains the main driver of petroleum demand, while the service sector consumes the largest share of imported fuels, accounting for 37.29 percent. Diesel is widely used in private and public vehicles, construction, and industry. Imports also include aviation turbine fuel, liquefied petroleum gas and kerosene. Limited public transport, rising vehicle ownership, and the high cost of electric vehicles have slowed the transition to cleaner alternatives.
Although the government has introduced incentives such as free electricity for electric vehicle charging and loans covering up to 70 percent of electric vehicle purchases, adoption remains limited.

“The high upfront cost of electric vehicles and limited charging infrastructure remain key barriers to wider adoption,” the Ministry of Energy and Natural Resources said. Shortages of trained electric vehicle technicians, high costs of fast-charging stations, and insufficient charging facilities in homes and commercial buildings further constrain progress, limiting large-scale deployment.

Even with abundant hydropower, Bhutan faces seasonal electricity shortages during dry winter months when river flows decrease, forcing the country to import power from India. Electricity imports surged by 134.43 percent in 2024, highlighting the seasonal vulnerability of hydropower and the need for diversified, resilient energy systems. Infrastructure limitations and export commitments make balancing domestic consumption with cross-border trade a continuing challenge.

Despite these trends, Bhutan still retains more than 70 percent forest cover and remains carbon negative. However, rising fossil fuel consumption presents a growing test of that status, as higher fuel use contributes to carbon emissions that offset the country’s forest carbon sink. The widening gap between clean electricity production and fossil fuel use has sparked concerns over whether Bhutan can maintain its global environmental reputation.

The government, however, maintains that its climate commitments remain firm. “Bhutan’s commitment to carbon neutrality is unwavering and backed by clear, economy-wide action,” the Ministry of Energy and Natural Resources said. Under the Economy-Wide Mitigation Ambition framework, Bhutan aims to expand renewable energy generation to 25,000 megawatts by 2040 while advancing electric mobility, shared transport systems, industrial energy efficiency, and circular economy practices. The Nationally Determined Contribution 3.0 commits to keeping national emissions below the carbon absorbed by forests, while the forthcoming Long-Term Strategy 2025 aligns these targets with the 10X National Economic Vision 2050.

Officials stress that hydropower, forest conservation, and carbon finance form the foundations of Bhutan’s low-emission future. “Our forests, clean energy investments, and carbon finance are the foundation of Bhutan’s low-emission future,” the Ministry of Energy and Natural Resources said. The National Adaptation Plan 2023 further strengthens resilience in water, agriculture, health, and biodiversity sectors, integrating mitigation and adaptation through sustainable land management, renewable energy expansion, and waste reduction initiatives.

Despite these assurances, rising fossil fuel imports reveal the complexity of maintaining carbon neutrality in a developing economy facing growing transport needs, urbanization, and energy trade expansion. Experts warn that unless the adoption of electric mobility accelerates and energy diversification deepens, Bhutan may struggle to maintain its environmental credibility.

The country’s forests and renewable energy infrastructure continue to make it a global sustainability exemplar. Yet the latest statistics illustrate that achieving a fully green transition will require more than hydropower success. Future energy policies will need to address transport, diversification, and infrastructure to ensure Bhutan remains on a credible path toward carbon neutrality.