The power ministry has cut down the target for thermal capacity addition for the year 2023-24 to 7.16 gigawatt (GW_ from 14.72 GW projected earlier as many projects have been delayed. Against its target of adding 12.72 GW of thermal capacity addition during April 2023 to January 2024 initially, the country has only added 3.39 GW of thermal capacity so far, data from the Central Electricity Authority showed.
The government had earlier set a target of 14.7 GW of thermal capacity addition for the year 2023-24. However, in its latest thermal broad status report for January, the government has brought down this target to 7.16 GW due to a delay in the execution of thermal power projects. Essentially based on the current status, they (the government) are only expecting around 7 GW to be commissioned. From that again, how much will get commissioned is to be seen. Our estimation is it may not go beyond 5 GW,” said Vikram V vice-president & sector head, of corporate ratings, Icra. “The key reasons for this are the delay in some or the other work, some equipment getting delayed, or some work getting delayed. There also have been land acquisition issues.”
The country’s power supply ran into a deficit of 1.4% in the April to January period with the power companies being able to meet only 239.93 GW of the total power demand of 243.27 GW, data from the Central Electricity Authority showed. This deficit stood at 4% in 2022-23 when the peak demand for power touched 215.89 GW.
Furthermore, as the government plans to add 80 GW of new thermal power capacity amid rising demand for power, the demand for coal by the power sector is set to rise to 1.16 billion tonnes by the year 2030, from the current 793 million tonnes, a rise of 46.3%, government estimates show. By the year 2047, power and other non-regulated sectors will alone require 1.7 billion tonnes of coal to be able to meet the peak demand.
Vikram noted that presently 37 GW of thermal capacity is under construction which should comfortably get commissioned in the next three years. “Given the complexity of thermal plants there are a lot of things that need to fall into place – transmission lines, water pipelines, coal transportation lines, railway sidings among others,” he said.
The government has also estimated coal-based power generation to increase to 1,344.20 Terawatt hours in FY26 and then to 1,689 TWh by FY30. During FY23, the coal-based power plants produced 1,145.86 TWh of electricity, as per data from the coal ministry.
The country’s coal-based power generation is however set to decline to 66.40% in FY26 and then further to 61.61% in FY30 as the country simultaneously ramps up its renewable energy generation. Presently, the share of coal-based power stands at 70.24%, according to the Coal Ministry’s estimates.
India has a total power generation capacity of 429.96 GW of which 240.44 GW belongs to fossil fuel sources and 189.53 GW belongs to non-fossil fuel sources.
The government has projected an electricity generation target for the year 2023-24 at 1,750 billion units (BU). In the first eleven months of FY24, the country’s electricity requirement reached 1,358.6 BU with only 1,354.97 BU being available for consumption. The country generated 1,624.16 BU during 2022-23.
India has now and again affirmed its reliance on coal-based power and has advanced steps in this area – including the addition of 80 GW of new thermal capacity by 2031-32. Electricity demand in the country rose 7% in 2023. The International Energy Agency has forecast a growth of 6.5% on average in electricity demand in 2024-2026, the fastest growth rate among major economies.
“Typically any project execution for 80 GW, will need at least five years to get commissioned once the construction work has started. If you are to reach the 80 GW target by 2032, the construction needs to start by 2026-27,” Vikram said. “For that to happen, all the approvals, etc will have to start now.”