Power demand up 4.6% in September

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October 13, 2020 4:00 AM

Power consumption in the country fell 8.5% year-on-year (y-o-y) to 625.6 billion units (BU) in the first half of the fiscal as industrial and commercial activities remained muted amid lockdowns imposed across the nation to contain the coronavirus outbreak.

power sector, reforms in power sector, discoms, distribution companiesWith everything shut, the consumption of electricity by industrial and commercial establishments as well as the railways has seen a huge drop.

Signaling the pick-up of industrial and commercial activities, electricity demand in September recorded a 4.6% growth y-o-y to 112.4 BU, making it the first month in the ongoing fiscal to post a positive growth.

Power consumption in the country fell 8.5% year-on-year (y-o-y) to 625.6 billion units (BU) in the first half of the fiscal as industrial and commercial activities remained muted amid lockdowns imposed across the nation to contain the coronavirus outbreak.

Power demand in states like Gujarat, Maharashtra, Tamil Nadu and West Bengal — where industrial and commercial consumers comprise more than 40% of electricity usage — were lower by 12.5%, 11.6%, 12.9% and 13.7%, respectively, in the first half of the fiscal.

Fall in power demand in states such as Rajasthan and Madhya Pradesh — where agricultural power consumption is high — were less drastic. While Rajasthan recorded an annual fall of 2.6% in the first six months, power consumption in Madhya Pradesh inched up 0.1% y-o-y in the same period.

While Gujarat recorded an impressive 10.7% demand hike in September, the rise in Punjab and Maharashtra were 8.1% and 4.2%, respectively. Power consumption in Tamil Nadu and West Bengal were actually around 2-3% lower than the same month previous year. Muted power demand growth can be symptomatic of the industrial slump prevailing much before the onset of the coronavirus disruptions. Lower electricity volumes consumed by highly industrialised states in FY20 had dragged down the country’s annual demand growth to a six-year low of 1.3%.

Owing to lower demand, power generation also fell on a y-o-y basis in the first half of FY21, but its impact was felt more on coal-based stations than the renewable energy units. Owing to its ‘must run’ status and growing capacity, renewable energy generation fell only 1% while output from conventional power plants dropped about 9%.
Analysts at Care Ratings pointed that wind power generation, which accounts for about 50% of renewable energy, was 14% lower y-o-y in April-September, 2020, while solar power output in the period was 25% higher annually. Plant load factor of coal-based power plants fell to 50% in this period from 58% a year ago.

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