Coal-based thermal power plants generated 87.8 billion units (BU) of electricity in December 2017 · about 2 BU less than the production in the corresponding month in 2016.
Coal-based thermal power plants generated 87.8 billion units (BU) of electricity in December 2017 · about 2 BU less than the production in the corresponding month in 2016. However, for the nine-month period in FY18, the overall thermal generation went up by 4% to 768 BU. The plant load factor (PLF) at thermal power plants in the first three quarters was 63.8%, more than four percentage points higher than the corresponding period in FY17.There was a power supply shortage of 2.8% during the hours when electricity demand was highest in December 2017. Uttar Pradesh recorded a massive peak shortage of 335 MW, second only to Jammu and Kashmir (552 MW). The peak deficit was only 0.5% in December 2016.Since electricity cannot be stored, generation is the most robust indicator of demand. However, as renewable electricity production data is not available yet, it is difficult to attribute the lower thermal generation in December solely to fall in power demand as the rise in share of renewables can also play a role. Usually, renewable sources produce 6-12% of the overall electricity in the country, while coal-based power generate 85-90%.
Nevertheless, thermal power generators, mired in a scenario where demand growth is muted and installed production capacity is twice the levels of peak demand, may draw some respite from the fact that generation capacity addition in April-December was only 4,300 MW, 39% down annually. This is the second instance in the ongoing fiscal where monthly thermal generation slipped on a year-on-year basis, invoking apprehensions about transition to renewable energy posing risks to thermal power. A report on renewable energy integration, co-authored by national grid operator
Power System Operation Corporation, had pointed that adding 175 GW of renewable energy would lead to PLF of coal-based power plants dropping to around 50%, with 65,000 MW plants running at PLFs below 30%.
The Economic Survey published by the finance ministry in August 2017 had also noted that the social cost of renewables was around Rs 11 per unit in FY17, accounting for the sub-optimal utilisation of coal-based power assets as a result of shift to renewables. Research agencies such as Icra estimate the size of financially stressed assets to be around 60GW due to lack of power purchase agreements (PPA), shortage of gas and under-recovery caused by pricing issues of imported coal. About Rs 4 lakh crore of debt is likely to become NPA if prevailing issues are not resolved.