Weekly Power Sector Round up: 14th August 2021

India’s power consumption up 9.3% in 1st week of August

India’s power consumption grew 9.3% in the first week of August to 28.08 billion units (BU) from 25.69 BU in the same period last year. Increased economic activity on account of easing of lockdown curbs by states is likely to be the major driver.

Consumption is likely to keep growing, however, a third wave of the COVID pandemic can hit consumption if curbs on activity are imposed again.

DISCOM losses to be 40% above pre-pandemic levels: Crisil

Cash losses of distribution companies (DISCOMs) will remain elevated at around Rs 46,000 cr this fiscal, 40% higher than the Rs 33,000 cr seen in the pre-pandemic levels of fiscal 2020, according to Crisil Ratings.

Revenues will remain constrained as demand from commercial and industrial consumers has been lower and tariff hikes have been inadequate. Costs are also likely to surge because of higher interest burden of increasing debt.

It is estimated that the lockdowns imposed to curb the pandemic reduced an entire quarter’s worth of demand from the pre-pandemic fiscal.

Operating costs may also rise 3% on account of pricier fuel, transportation and a steady increase in administrative costs.