Weekly Power Sector Round up: 22nd August 2020

Peak power demand declines again to 5.65% in August

After having recovered to a deficit of 2.61% in July, the peak power demand has slumped further to 5.65% in the first fortnight of August, according to data from the Ministry of Power. Peak power demand met (highest energy supply during a day across the country) stood at 167.49GW for the first fortnight of August, compared to 177.52GW during the same period last year.

Electricity demand was expected to recover to previous year levels on account of easing of lockdown measures across the country. However, it looks like the deficit might be here to stay until a permanent solution to COVID-19 is found.

India to reduce dependence on thermal power to 50% by FY22

India’s dependence on thermal power will drop to 50% by FY22 and to 43% by FY27 on account of renewable capacity addition, according to a report by Praxis Global Alliance and Zetwork. Thermal power, which includes diesel, gas and coal based electricity generation accounts for 63% of the total electricity generation capacity as of today.

Installed power generation capacity has grown at 8.6% CAGR over FY12 to FY19, with renewables growing at the fastest pace. Private investment is also likely to be the largest in the renewable sector going forward. On the other hand, long term PPAs for thermal power are unlikely to pick up owning to numerous issues with existing PPAs.