India is breaking all records on power demand front. Here is why

New Delhi: India's power demand, a barometer of economic activity and progress, is growing at a historic pace in the current financial year. The trend, a result of a multitude of factors boosting industrial and residential load, is likely to continue for some time, say experts.

Power demand in the country usually grows in a range between 2 per cent and 7 per cent year-on-year. However, the massive lockdown imposed as a result of the coronavirus pandemic last year, pulled down electricity consumption to 6.6 per cent.

According to data sourced from Central Electricity Authority( CEA), the all India peak power demand in the period between April-August 2021 stood at 203,014 MW, as compared to 171,510 MW in the same period last year.

In the northern region, Uttar Pradesh recorded the highest power demand of 24,965 MW with the region's total demand at 73,461 MW. Next was Maharashtra from the western region with 25,653 MW of peak demand with the region's total demand at 60,966 MW.

The southern region’s total power demand was 58,430 MW with Tamil Nadu recording the highest at 16,541 MW. Similarly, the eastern region recorded a total of 26,019 MW of power demand with West Bengal recording power demand of 9,089.

“The all India electricity demand is expected to increase by 6.0 per cent for FY2022 on a year-on-year (Y-o-Y) basis, considering the favourable base effect, relatively lesser impact of the second wave on electricity demand and the pick-up in the vaccination programme,” Sabyasachi Majumdar, Senior Vice President & Group Head - Corporate Ratings, ICRA Limited said.

He said the electricity demand growth thereafter would remain linked with the growth prospects for the economy.
With respect to segment-wise demand, the industrial segment is likely to lead the demand recovery in FY2022 owing to a contracted base, as this segment would have witnessed a contraction in electricity demand in FY2021 amid the impact of Covid-19 on industrial activity, especially during H1 FY2021.

The all India electricity demand increased by 15.5 per cent in 5M FY2022 (595 BUs) against 5M FY2021 (515 BUs). This is owing to a favourable base effect as the demand during the corresponding period of previous year was impacted by the hard lockdown imposed to control the first wave of Covid-19 outbreak.

Shortfall in rainfall in some of the months in the current fiscal also led to higher demand for electricity during 5M FY2022.
On the other hand, compared with the demand in the pre-Covid period, 5M FY2020 (579 BUs), the demand in 5M FY2022 is higher by about 2.7 per cent. This indicates a marginal recovery from pre-Covid level.

ET Energy World