Power demand up 8% in early November

With the gradual recovery of economic and commercial activities in the festive season, early signs indicate that power consumption in November is heading for a positive growth on a year-on-year (y-o-y) basis, making it the third straight month to record an annual rise in electricity demand.

According to the government’s preliminary data, 50,159.6 billion units (BU) of electricity was supplied across the country in the first 15 days of November, which is 7.8% higher than what was consumed in the same period last year.

Even though power consumption fell 8.5% y-o-y to 625.6 BU in the first half of the fiscal amid lockdowns imposed across the nation to contain the coronavirus outbreak, electricity demand in September grew 4.6% y-o-y to 112.4 BU, making it the first month in the ongoing fiscal to post a positive growth. Electricity demand in October was around 111 BU, 12% higher than last year. However, the larger surge in October also reflects the effect of a lower base, as power sales in October, 2019 was exceptionally muted — down 12.8% y-o-y — with higher rainfall reducing agricultural and domestic usage. At 95,053 BU, power sales in November, 2019 was also lower by 3.3% y-o-y.

Lower electricity volumes consumed by highly industrialised states like Gujarat, Maharashtra and Tamil Nadu 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 fell on a y-o-y basis in the first half of FY21 as well, 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%.