India Ratings and Research (Ind-Ra), in the May 2021 edition of its credit news digest on India’s power sector, published on Friday, said the recovery in energy demand will continue despite Covid-19 led temporary blip.
The report highlights trends in the power sector, with a focus on capacity addition, generation, transmission, merchant power, deficit, regulatory changes and recent rating actions by Ind-Ra.
As per their statement, Ind-Ra estimates the all-India energy demand to decline in May 2021 on a month-on-month basis, despite peak summer season, and to remain below pre-pandemic levels, on account of the continuation of Covid restrictions in some states till May 31. The agency added it expects energy demand to start recovering from June 2021.
3 February 2026
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In the first 25 days of May 2021, the all-India energy demand was 88.8 billion units (May 2020: 102.6 billion units; May 2019: 120.7 billion units). In April 2021, the all-India energy demand was higher by 39.3 per cent y-o-y (year-on-year) at 118.4 billion units (March 2021: up 22.8 per cent) due to the lower base effect and early onset of summer contributing to higher demand.
The short-term power price at Indian Energy Exchange remained high at Rs 3.70/kWh in April 2021 (March 2021: Rs 4.07/unit; April 2020: Rs 2.41/kWh) on account of a high demand from the short-term power market.
Electricity generation increased 42.5 per cent y-o-y to 115.5 billion units in April 2021 (March 2021: up 23.5 per cent), supported by 55.4 per cent y-o-y growth in thermal generation (up 29.2 per cent y-o-y), although hydro generation fell 18.4 per cent y-o-y (down 7.8 per cent y-o-y). Electricity generation from renewable sources increased 17.9 per cent y-o-y to 11.7 billion units in April 2021, with solar generation increasing 41.5 per cent y-o-y.
Improvement in energy demand and reduced generation from hydro units have helped thermal plant load factor (PLF) increase to 66.7 per cent in April 2021 (April 2020: 42.2 per cent; March 2021: 66.5 per cent).
In April 2021, the thermal sector’s PLFs rose on a y-o-y basis across the central, state and private sectors, increasing to 78.4 per cent (April 2020: 52.0 per cent), 60.3 per cent (33.5 per cent) and 62.0 per cent (41.6 per cent), respectively, it added.
