India’s hydropower generation, which has been on the decline for the past year, is facing further challenges due to the delayed monsoon and shrinking reservoir levels. The southwest monsoon, which arrived in Mumbai two days earlier than usual on June 9th, has lost its momentum and is yet to pick up pace. This, coupled with the impact of El Nino, resulting in erratic rainfall and an extended dry spell last year, has left water reservoirs depleted. According to the Central Water Commission, as of June 20th, the live storage available in the country’s 150 key reservoirs stands at 37.662 BCM (billion cubic meters), representing only 21% of the live storage capacity. This is a stark 80% decrease compared to the same period last year. Moody’s Ratings issued a warning on Tuesday, highlighting that India’s annual average per capita water availability is projected to decline to 1,367 cubic meters by 2031, down from 1,486 cubic meters in 2021. The water ministry considers a level below 1,700 cubic meters indicative of water stress, while 1,000 cubic meters marks the threshold for water scarcity.
The decline in hydropower generation is reflected in the figures. During the last financial year (FY24), power generation from hydroelectric sources fell by 17.33% to 133.97 billion units, down from 162.05 billion units in FY23. In April, the drop was even more pronounced, with hydropower generation falling by 7.71% year-on-year to 7.99 billion units. Vikram V, vice-president & co-group head, corporate ratings, ICRA, stated, “Given the delay in monsoon progress and lower reservoir levels, hydropower generation is anticipated to remain flat compared to last year, assuming a normal southwest monsoon rainfall as per the IMD (India Meteorological Department) prediction. However, if rainfall continues to be below normal, hydropower generation may even decline compared to last year. Furthermore, some hydropower plants were shut down last year due to the adverse impact of floods and cloudbursts, and these plants are yet to resume operations.” He emphasized the crucial role of hydropower during the monsoon months, stating, “It is primarily during the first half of a financial year that hydro generation peaks. Last year, out of the 134 billion units produced throughout the fiscal year, 90 billion units of hydropower were generated in the first half.”
Typically, hydropower generation, which usually starts in June-July, significantly contributes to India’s power supply. However, this year, with the hydro plants lagging in their generation, coal-fired power plants are expected to shoulder the burden of meeting the rising demand. A recent report by S&P Global highlighted that India’s subdued hydroelectricity production in recent times might lead to increased reliance on coal to satisfy the growing energy requirements. The report pointed out that the declining hydroelectricity output, coupled with irregular rainfall in the past fiscal year, has resulted in lower water levels in the country’s primary reservoirs, which could further curtail hydropower generation during the summer months.
India’s installed large hydro capacity stands at 46.92 GW, accounting for about 10% of the total power generation capacity of 442.85 GW. However, capacity addition in the hydropower sector has also not shown significant progress in the past year. Data from CEA indicates that in FY24, only 60 MW of capacity was added, compared to 120 MW in the previous fiscal (FY23). The Indira Sagar reservoir in Madhya Pradesh, which supports a hydel capacity of 1 GW, is currently 17% full, down from 24% last year. Similarly, the Koyana dam in Maharashtra, with a hydropower capacity of 1.9 GW, is presently at 10% full, an improvement from 6% during the same period last year but lower than the normal level of 15% for this time of the year.
The decline in reservoir levels, coupled with the delayed monsoon and its potential impact on hydropower generation, comes at a time when power demand has already reached record highs and is expected to remain elevated amid an extended heatwave. On May 30th, the country’s peak power demand hit a new record high of 250 GW. Moody’s Ratings acknowledged that India is facing growing water stress due to rapid economic growth and climate change. They highlighted that this water shortage could disrupt various sectors, including agricultural production and industrial operations. Industries that rely heavily on water, such as coal power plants and steelmakers, would also be affected.
So far, thermal power plants have been able to meet the increasing demand. However, during this time of the year, several thermal plants undergo maintenance, which is crucial for their smooth operation. This year, due to the delay in monsoon rains in north India, several plants have not been able to complete the required maintenance, potentially leading to faults and disruptions in power supply. Meanwhile, the IMD on Tuesday stated that conditions are likely to become favorable for the further advance of the Southwest Monsoon into remaining parts of the North Arabian Sea, Gujarat, Madhya Pradesh, some parts of Rajasthan, West Uttar Pradesh, remaining parts of Chhattisgarh, West Bengal, Jharkhand and Bihar, most parts of East Uttar Pradesh, parts of Uttarakhand, Himachal Pradesh, Jammu, Kashmir, Ladakh, Gilgit-Baltistan, Muzaffarabad, northern parts of Punjab and Haryana over the next three to four days.
