In response to representations from power generating companies, the Ministry of Power has clarified that surplus power generated using linkage coal can be offered in the power market. This clarification refers to Section 9(5) of the Electricity (Late Payment Surcharge and Related Matters) Rules, 2022, which allows for the sale of surplus power within declared generation capacity but not requisitioned by distribution companies.
The power ministry’s proactive measures underscore its cautious approach to mitigate the risk of power outages, particularly during the upcoming poll season and amidst forecasts of record-breaking heat waves. Despite India’s recent record renewable capacity addition, the variability in renewable energy generation puts pressure on base load capacity, especially thermal units, during evening hours and periods of surging demand.
India’s reliance on coal and gas to meet peak demand is evident due to the lack of adequate energy storage infrastructure, which could help store excess energy generated by solar and wind plants during non-peak hours and release it during peak hours. While the peak deficit between peak demand and supply has narrowed in recent years, it could widen again if the surge in renewable capacity is not complemented with energy storage infrastructure.
In FY23, the peak deficit stood at -8.7 GW, 4 percent of the peak demand of 216 GW in April. In FY24, peak demand increased to 243 GW in September, but the deficit was contained at 1.4 percent due to a cooler-than-expected summer caused by unseasonal rainfall. In terms of net electricity shortage, April recorded the highest shortage of 2 percent followed by June and January at .6 percent each in FY23. In FY24, August recorded the highest shortfall of .6 percent, followed by .5 percent in January, and .4 percent in October.
