Power generation growth continues to limp due to sluggish growth in demand, as power stations run at a historic low utilisation, or plant load factor (PLF). According to the Central Electricity Authority (CEA), power generation grew by 1.1% in October to 99.7 billion units (BUs) compared with the same period a year ago, mainly due to a decline in coal-based generation.
The muted growth in October was led by 25 bps y-o-y decline in coal-based generation as PLF declined to 60%, a decrease of 710 bps compared with the same period a year ago. However, generation growth in October was also impacted by the high base from last year, when it grew by 9%. Power generation got off to good start at the beginning of the financial year when it clocked 15% growth in April. However, it has seen a steady decline since, with the exception of two intervening months. In August, there was nil growth compared with last year but generation grew by 2.4% in the subsequent month. CEA has kept the generation growth target for FY 17 at 6.3% to 1,178 BUs, but the year-to-date growth in generation has been lower than the projected target, at 4.5%, and lower when compared with the year-ago period.