New Delhi, June 18 (IANS) India’s power demand is expected to grow up to 7 per cent year-on-year in FY27 to around 1,810-1,830 billion units (BU) due to higher temperatures and lower rainfall linked to the expected El Nino effect, according to a report released on Thursday.

A report by Crisil said that electricity demand is likely to remain highly weather-sensitive in the current fiscal, with rising temperatures expected to boost cooling requirements across households, commercial establishments and industries.

In May, power demand rose 11.2 per cent year-on-year to 165 BU as several regions across north, northwest, west and central India recorded temperatures 1-4 degrees Celsius above normal.

Uttar Pradesh’s Banda recorded a high of 48.3 degrees Celsius on May 12.

For the April-May period, power demand increased 7.6 per cent year-on-year, compared with a contraction of 1.2 per cent in the corresponding period of FY26.

Peak power demand touched 271 GW in May, nearly 10 per cent higher than the peak of 245 GW recorded in FY26.

In addition, the report noted an improvement in industrial activity, with the Manufacturing Purchasing Managers’ Index (PMI) rising to 55 in May from 54.7 in April. Industrial and commercial consumers account for around half of India’s total electricity demand.

Real-Time Market (RTM) volumes rose about 16 per cent year-on-year to 5,529 million units (MU) in May, while the average market clearing price increased 21 per cent to Rs 4.16 per unit.

Similarly, the market clearing price in the Day Ahead Market (DAM) rose 18.3 per cent year-on-year to Rs 4.8 per unit.

Meanwhile, power generation increased around 12 per cent year-on-year to 178 BU during May.

Renewable energy generation grew approximately 20 per cent, while coal-based generation rose 12 per cent and continued to account for over 68 per cent of total electricity generation.

The report said India added 7.4 GW of renewable energy capacity, including small hydro projects, during the first two months of the fiscal year.

Meanwhile, coal inventories at thermal power plants declined to 49 million tonnes at the end of May from 60 million tonnes a year earlier. Coal stock levels fell to 16 days from 21 days during the same period as daily coal requirements increased amid rising electricity demand.

–IANS

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