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Business News/ News / India/  India’s low electricity demand may continue till July: S&P Global Platts
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India’s low electricity demand may continue till July: S&P Global Platts

The largest month-on-month decline is in the western region, followed by the south, but power demand has declined in all regions. The most recent number of registered COVID-19 cases have started to come down but are still at elevated levels

the situation with low power demand will continue into June, and possibly also for July. (Photo: Reuters)Premium
the situation with low power demand will continue into June, and possibly also for July. (Photo: Reuters)

NEW DELHI: With the second wave of the coronavirus pandemic keeping a large part of India’s population indoors, the country’s electricity demand dipped in May, according to S&P Global Platts.

India’s low power demand scenario may continue till July. This assumes importance given that energy consumption, especially electricity and refinery products, usually linked to overall demand in the economy.

Also, there were not many takers for coal-fuelled electricity.

“Coal averaged 140 GW in April but declined sharply to only 114 GW for May. The month-on-month decline of 26 GW is the largest on record, even larger than what we observed during the initial stages of the pandemic in 2020. As renewables continue to increase into the summer, we assume coal will average 100 GW for June and July, which is 5 GW lower year on year," according to a statement from S&P Global Platts.

Electricity demand that had revived following the unlocking after the first wave last year has dipped again, with fresh lockdowns imposed by most states to stem the second wave of pandemic that has claimed many lives.

“India’s power demand averaged 159 GW for May, which is 11 GW higher year on year, but 17 GW lower compared with April. The dip in power demand over the last half of May was influenced by lower-than-normal temperatures, with Delhi experiencing an average decline of 3.2°C year on year. However, the biggest factor impacting the power demand is the partial lockdown implemented due to the pandemic," according to the statement.

Indian refineries are also expected to reduce crude oil imports in May in the aftermath of the second wave, and its full impact will reflect in reduced crude oil imports by refineries for May, according to S&P Global Platts Analytics.

“The largest month-on-month decline is in the western region, followed by the south, but power demand has declined in all regions. The most recent number of registered COVID-19 cases have started to come down but are still at elevated levels. Therefore, we believe the situation with low power demand will continue into June, and possibly also for July. We assume power demand will average 155 GW for June, and 160 GW for July," the statement added.

India’s peak electricity demand fell during the first wave, with commercial and industrial demand taking a hit after many factories closed. However, domestic consumption, which generates comparatively lower tariffs, went up. India registered a record high of 189.6GW in January.

“Generation from non-hydro renewables averaged 18.2 GW for May, which is 1.2 GW higher year on year, and a new record for the month. On a daily level, generation from renewable energy sources reached 26.5 GW on both May 26 and 27, which are all time highs and an increase from 26 GW seen for one day in August 2020," the statement said.

Of India’s total electricity demand load pattern, industrial and agricultural consumption account for 41.16% and 17.69%, respectively. Commercial electricity consumption accounts for 8.24%.

“We expect combined hydro and renewables for the first time ever to breach an average of 50 GW for August, which is an increase of 4 GW year on year, and about 30% of the overall generation for the month," the statement said.

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Published: 04 Jun 2021, 12:04 PM IST
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