Power demand heats up to record high of 233 Gw due to rising temperatures

Experts believe prolonged hot weather would keep the electricity demand pushing up. This would drive demand for coal

India experienced a new peak in power demand, reaching a record 233 gigawatt (Gw) on Wednesday due to rising temperatures as the monsoon retreats across the country. As the formidable El Niño weather phenomenon reaches India, power demand is projected to remain elevated until October.

This is also expected to exert pressure on domestic coal supply, as the months of August to October are crucial for the coal supply chain. Typically, during these months, coal supply decreases due to a reduction in power demand. However, with changing climatic patterns and warm to hot temperatures expected across the country in the months to come, coal demand is set to rise.
 

On Wednesday, peak power demand during the day reached 233 Gw, with Northern India accounting for the majority at 81 Gw, followed by the Western region at 67 Gw, according to data from Grid-India.

Thermal power is the driving force, contributing nearly 80 per cent of the country’s total energy demand, as indicated by data from the National Power Portal. As of August 15, the average coal stock availability in thermal units stood at 11 days.

In its most recent report, rating agency ICRA projected a 5.5 per cent increase in power demand for the current financial year (2023-24), compared with 9 per cent in the previous financial year (2022-23). The agency also noted that El Niño is expected to positively influence electricity demand.

After a sedate start, the southwest monsoon picked up momentum in July, resulting in a cumulative all-India rainfall that was nearly 13 per cent above the 2023 normal levels. However, starting from August, widespread rainfall has taken a rain check over large parts of the country due to the adverse effects of El Niño gaining force. So far this month, the southwest monsoon has been limited to the foothills of the Himalayas and the Northeastern states.

Between August 1 and August 16, monsoon rainfall across India has been nearly 38 per cent deficient, among the worst in recent times. The most significant impact of this rainfall deficit is felt in the North-Western regions of the country, where high temperatures coincide with intense humidity.

August temperatures in most parts of North India ranged between 30 degrees Celsius and 40 degrees Celsius, which is unusually high for this time of year. Until August 11, rainfall in North India for August was nearly 38 per cent below normal, while peninsular India experienced a 72 per cent deficit. Between June 1 and August 16, the cumulative rainfall was 6 per cent below normal, which, by the end of July, was in excess of 5 per cent.

There’s more grim news. Most meteorologists suggest that there may not be a significant pick-up in rainfall over several parts of the country in the coming days, as the ‘break phase’ is expected to continue for another five to six days before September arrives.

In September, rainfall normally weakens across India, retreating from western Rajasthan.

Even if September sees above-normal rainfall, it is unlikely to substantially improve the situation, given that September typically receives only about 160 millimetres (mm) of the total 870 mm of rainfall between July and August (approximately 18.3 per cent).

Experts believe that prolonged hot weather will continue to push up electricity demand and subsequently coal demand. On the domestic front, the national mining company, Coal India (CIL), asserts that it has sufficient supply to meet demand.

With dry weather persisting, CIL’s mines are expected to continue supplying coal even during their traditionally dry period.

Similarly, rail transport will also need to be effectively managed during this time. The Ministry of Power has directed all power generators to import coal to meet the rising demand and address the lacuna in domestic coal supply.