India’s electricity consumption is expected to jump by up to 7.5% this fiscal year, driven by record-breaking heatwaves and decreased rainfall, placing unprecedented strain on the country’s power system, according to Crisil Intelligence.
India’s electricity demand is set to climb sharply this fiscal year as hotter weather, weaker rainfall and rising cooling needs put fresh strain on the power system, according to Crisil Intelligence. The rating agency expects consumption to rise 6.5% to 7.5% year on year to 1,825-1,835 billion units, with air-conditioners and other cooling equipment likely to drive a larger share of usage if temperatures remain elevated.
The forecast comes after a strong July, when power demand increased 10.9% from a year earlier to about 171 billion units, the highest monthly level on record, ANI reported. Crisil said the rise reflected both intense heat and a rainfall shortfall that increased reliance on cooling. Between June 1 and July 29, rainfall was 10% below normal in north-west India, 1% below normal in central India and 26% below normal in southern India, leaving the country with an overall deficit of 15% for the period.
Higher consumption has already fed through to generation. Electricity output rose about 10% in July to 182 billion units, with most major sources posting gains apart from gas and hydropower, the report said. Renewable generation also increased around 10%, helped by added capacity. India brought 13.2 gigawatts of renewable capacity, including small hydro, online in the first quarter of the fiscal year. Crisil’s earlier analysis has repeatedly pointed to the growing role of clean energy in meeting demand, with its March 2023 outlook saying renewables were on track to account for a larger share of power supply as solar and wind capacity expanded.
Hydropower remains the main weak spot when rainfall is patchy. Crisil said hydro generation fell about 14% in July as reservoir levels came under pressure. The energy content of 31 reservoir-based hydropower projects stood at about 14 billion units on July 31, well below the roughly 34 billion-unit full-reservoir potential and down from about 22 billion units a year earlier. The agency has previously warned that peak demand, weather swings and short-term power prices are likely to stay key variables for the sector, echoing earlier concerns in 2023 when it projected a summer peak-power deficit and a sharp rise in demand during heat waves.
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