Electricity demand grows in July after two months of degrowth

New Delhi, Aug 12 (IANS) India's power demand rose by 2.4 per cent in July, reaching 154 billion units (BUs), up from 150 BUs a year earlier, driven by strong industrial activity, a report said on Monday.

The improvement in demand is in sharp contrast to May and June, which saw YoY degrowth of 4.8 per cent and 2.3 per cent, respectively, according to a report from Crisil Intelligence.

In July, the average market clearing price (MCP) in the real-time market (RTM) fell 23 per cent YoY to Rs 3.83 per unit, indicating sufficient supply amid low electricity demand. The spread between RTM and DAM (day-ahead market) volumes declined to 401 million units (MU) in July, down from an average of 2,529 MU from June 2020 to July 2025.

While generation from thermal power declined year-on-year this July, that from major clean energy sources, i.e., hydro and renewable energy, increased. Higher rainfall resulted in a 36 per cent YoY rise in hydropower generation, while renewable energy rose 7.2 per cent, the report said.

Consequently, coal accounted for 63 per cent of the total power output from 66 per cent a year ago, which also highlighted the easy ability of the fuel to be ramped up or down by power demand. Coal inventory stood at 18 days, compared with 21 days in May and June. As of July 31, thermal power plants had 54 million tonnes (MT) of coal stock.

Crisil Intelligence estimates a 2.5 to 3.5 per cent YoY growth in power demand in this fiscal year to around 1,745 BU, marking a moderation from 4.2 per cent last fiscal year.

The IMD estimates another good southwest monsoon season. The consequent lowering of ambient temperature is expected to curb electricity demand.

–IANS

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