India’s power deficit touched a historic low of 1.5% in November owing to a clutch of factors including near-flat pan-India demand, new capacity additions and a steep fall in offtake of electricity in Tamil Nadu, many parts of which including Chennai were ravaged by floods recently. Although November has historically been a month when energy demand fell from the preceding month by 5-8% due to the onset of winter, this time around, the month-on-month decline was sharper at 12%.
The country’s power demand grew by a mere 0.4% in November compared with the corresponding month a year ago — the pan-India demand was 85.8 billion units (bu) last month versus 85.4 bu last year.
The deficit was 2.6% in October on a demand of 98.4 bu and stood at a high of 3.4% in November last year. The country’s power deficit stood at 8.7% in FY13 and it has since declined to 4.2% in FY14, 3.6% in FY16 and 2.3% in April-November this year.
The floods in the state meant that Tamil Nadu’s demand fell by an annual 10% this November from a year earlier and by 25% on a sequential basis. Tamil Nadu is the fourth largest state in terms of power consumption after Maharashtra, Gujarat and Uttar Pradesh.
The demand slump is reflected in the decline in the utilisation factor or plant load factor (PLF) at the thermal utilities in November. Thermal power plants make up for nearly two-thirds of the entire capacity in the country.
“After two months of thermal PLFs increasing year over year, November PLF declined by nearly 7 percentage points year-on-year as well as month-on-month to 60%,” a JPMorgan report said. Though the decline in PLF was witnessed across central, state and private utilities, it was more pronounced in the case of state-run and private plants. NTPC’s plants, with an average PLF of a healthy 77%, fared relatively better.
With the power demand growth slowing down since FY14, the supply growth has outpaced the rise in demand, contributing to a decline in overall deficit.