Power consumption falls again in June; economic activity dull in Unlock-1 phase

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Published: July 1, 2020 3:40 PM

The consumption of electricity in June fell 9.74 per cent to 106.48 billion units (BU), compared to 117.98 BU a year ago.

power, power demand, electricity consumption, electricity demand, power usageThe contraction in the power demand narrowed as India stepped out of the strict nationwide lockdown and entered the Unlock-1 phase.

Coronavirus-led lockdown restrictions and the consequent slow economic activity are still taking a toll on the power consumption in India. The consumption of electricity in June fell 9.74 per cent to 106.48 billion units (BU), compared to 117.98 BU a year ago. However, the contraction in the power demand narrowed as India stepped out of the strict nationwide lockdown and entered the Unlock-1 phase. The slump in power consumption was 14.86 per cent in May and 23.21 per cent in April 2020. The power consumption has improved after the government gave relaxations for economic activities and heatwave intensified in the country, PTI reported citing data provided by the Ministry of Power. 

The latest data of the Ministry of Power shows that the months of April, May, and June this year witnessed low power consumption on account of lower commercial and industrial activities due to COVID-19-related restrictions. Though the power demand is picking up as more economic activity has started, there may not be a significant increase in the same given that the resumption of activity is expected to be gradual and limited.

Also Read: Why sharp rise in GST collections in June doesn’t indicate revival in businesses, economy

India’s power sector performance is expected to see a significant decline in 2020-21, due to the prolonged disruptions caused by the coronavirus pandemic, said a report by Care Ratings. On the back of lower power demand, power generation would also see a significant decline, the report added. 

Meanwhile, the lockdown brought a sharp reduction in electricity consumption despite the power sector being outside the ambit of the lockdown. The electricity demand and generation had fallen to a 5-year low during Apr – May 2020. The power generation plunged by 19 per cent on-year to 201 billion units during April and May. The low power demand has become a double-edged sword for the power companies as they are already struggling with the transmission and distribution losses and the outstanding dues of power distribution companies (DISCOMS).

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