The government of Bhutan has started construction of the country's first large-scale ground-mounted solar power plant, the Sephu Solar Project, which has an installed capacity of 17.38MW.

The Ministry of Energy of the Bhutanese government (under the Ministry of Energy and Natural Resources of Bhutan) will oversee work on the project, which will be completed by a joint venture between Bhutanese construction company M/S Rigsar and Indian engineering firm PES.

The Bhutanese government plans to complete the project construction by the end of 2024. At that time, the power station will be handed over to the Bhutanese power company Druk Green Power for operation. According to the Bhutanese government, the project is being financed primarily by the Asian Development Bank, which has pledged grants and loans to cover the $11 million project cost.

The Sephu power station will be the first large-scale ground-mounted solar project in Bhutan's solar industry, and Rubesa has only one 180kW power station in operation. The Sephu Power Station will be a central component of Bhutan's growing solar industry. The government of Bhutan plans to have installed solar capacity of 500MW by the end of 2025 and 1GW by the end of this century. Bhutan hopes to diversify its energy structure and reduce its dependence on imported electricity from India.

Currently, biofuels and hydropower dominate Bhutan's energy mix. According to the International Renewable Energy Agency, Bhutan will have an installed electricity capacity of 2.3GW in 2021, 84% of which will come from renewable sources. Of this, 54 percent comes from bioenergy and 46 percent from hydropower, a reliance on hydropower that often leads to disruptions in Bhutan's energy grid. During winter, when energy demand is high, Bhutan's hydropower production capacity drops significantly.

Bhutan's economic affairs minister, Loknath Sharma, said in a speech in February this year that Bhutan's grid can generate about 2.3GW of electricity in the "remaining period of time", but in winter, as temperatures drop and rivers freeze, power output drops to 500MW. .

Bhutan's energy demand in winter is as high as 670MW, and by 2030, Bhutan's energy demand will reach 1.5GW. During the most recent winter, Bhutan imported about $9.7 million (Nur 800 million) in electricity from India. It is important for the Bhutanese government to ensure that electricity supply is not affected by seasonal fluctuations or foreign import costs.