Industry

‘COVID wave may hit energy demand in first quarter’

Restrictions following the second wave of the COVID-19 pandemic could impact recovery in the growth in energy demand in the first quarter of this financial year, India Ratings and Research (Ind-Ra) said.

In the April 2021 edition of its credit news digest on India’s power sector, the agency highlighted trends in the power sector, with a focus on capacity addition, generation, transmission, merchant power, deficit, regulatory changes and the recent rating actions by the ratings agency.

Ind-Ra said lockdowns on account of an increase in COVID-19 cases in various States could impact energy demand growth recovery in April-June 2022. However, all-India energy demand is expected to be higher year-on-year due to the low base effect as the country was under a stricter lockdown during the same period in 2020.

‘Price per unit rises’

The short-term power price at the Indian Energy Exchange continued its improving trend ₹4.07 per unit compared with ₹2.46 a year earlier, with average monthly price in April 2021 at ₹3.7.

Electricity generation rose 23.5% on a yearly basis to 118.6 billion units in March 2021, supported by 29.2% growth in thermal generation, although hydro generation fell 7.8%. Generation from renewable sources climbed 10.1% to 11.9 billion units in March 2021, with solar generation rising 21%.

The improvement in energy demand has helped the thermal plant load factor (PLF) increase to 66.5% in March 2021, from 51.5% a year earlier and 63.3% in February, it said.

Despite the onset of summer, stricter lockdowns in major manufacturing States could impact demand from the industrial segment, in turn affecting thermal PLFs, the agency said.


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Printable version | Jun 15, 2021 3:58:50 AM | https://www.thehindu.com/business/Industry/covid-wave-may-hit-energy-demand-in-first-quarter/article34502260.ece

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