India’s Power Demand Hits Record 169 BU In August, Rises 12.8% YoY: Crisil

New Delhi, Sept 10 (KNN) India’s power demand surged 12.8 per cent year-on-year to around 169 billion units (BU) in August, the highest ever for the month, as intense heat and below-normal rainfall drove up cooling requirements, according to Crisil Intelligence.

Peak power demand also rose 12 per cent to 258 GW in August from 230 GW a year earlier, while power demand during April-August grew 9.5 per cent year-on-year, sharply higher than the 0.3 per cent growth recorded in the corresponding period last fiscal.

Crisil Intelligence, in its report ‘Scorching streak’, attributed the increase to higher cooling demand amid a 13 per cent rainfall deficit between June 1 and August 26, linked to El Niño conditions. The research firm expects India’s power demand to grow 7.5-8.5 per cent to 1,840-1,850 BU in FY2026-27.

Coal Stocks Come Under Pressure

The rise in power generation has put pressure on coal inventories at thermal power plants. Stocks fell to 29 MT as of August 30 from 50 MT a year earlier, reducing available supplies to nine days of requirement from 17 days, reported Economic Times.

Coal-based generation increased 13 per cent year-on-year in August, accounting for 63 per cent of total generation. Coal dispatches to power plants rose 4 per cent to around 281 MT during April-July, but average daily coal consumption increased to 3.10 MT during April-August from 2.97 MT a year earlier.

As of August 31, 51 of the country’s 190 coal-based power plants had critical inventories below 25 per cent of their normative requirement, up from 20 plants a year earlier. Of these, 46 relied on domestic coal, four on imported coal and one on washery rejects.

Power Market Prices Rise

Higher demand also pushed up prices in the power market. Real-Time Market volumes rose 10.6 per cent year-on-year to 5,565 million units in August, while the average market clearing price increased 30.4 per cent to Rs 4.41 per unit.

The Day-Ahead Market price rose 22 per cent to Rs 4.88 per unit. The gap between solar and non-solar hours widened, with average prices during solar hours remaining almost unchanged at Rs 1.62 per unit, while non-solar prices rose to Rs 5.30 from Rs 4 per unit.

Renewable Output Gains, Hydro Generation Falls

Overall power generation increased 12.6 per cent year-on-year to 180 BU in August. Renewable generation rose around 27 per cent, supported by capacity additions, with India adding 16.3 GW of renewable capacity, including small hydro, between April and July.

Hydropower generation, however, declined around 9 per cent due to weak rainfall. Energy content in 31 reservoir-based hydropower projects stood at around 22 BU as of August 30, below their full-reservoir potential of about 34 BU and down from 25 BU a year earlier.

Crisil Intelligence said peak demand and the sensitivity of short-term power market prices to temperature changes will remain key indicators to monitor as demand continues to be shaped by weather conditions.

(KNN Bureau)