India: Powering ahead! Coal output jumps 13% – Read here for more on top 5 energy generators

Power generation saw a 15.35 per cent year-on-year (YoY) increase to 169BU, on a lower base of May 2023, when power generation rose by 5 per cent YoY to 146BU.

Due to the soaring temperature in different parts of the country, the power demand reached all-time high, recording an increase of 13 per cent to 250GW in May 2024 as compared to 221GW in the same period of previous year. In fact, it crossed all records of FY24 as the peak demand recorded last year was 243GW in September 2023. Power generation saw a 15.35 per cent year-on-year (YoY) increase to 169BU, on a lower base of May 2023, when power generation rose by 5 per cent YoY to 146BU.

According to a report by Elara Capital, coal plant output increased by 13 per cent YoY to 122BU. Hydro plant generation, after a period of stagnation, grew by 9 per cent YoY to 13BU. Gas-based generation recorded a growth of 117 per cent YoY to 5.2BU, driven by the Government’s directive to operationalize all gas-based plants under Section 11. Renewable energy (RE) generation climbed by 16 per cent YoY to 21BU. The plant load factor for coal-based plants rose to 76 per cent in May 2024 from 69 per cent in May 2023.

Furthermore, the report stated that the Tata Power’s generation rose by 11 per cent YoY to 4.8BU, while the Mundra plant, operating under Section 11, saw a 15 per cent YoY increase to 2.1BU. Torrent Power’s generation increased by 50 per cent YoY to 1.4BU.

Additionally, pan-India non-solar demand also hit a record high of 234GW. The Central Electricity Authority (CEA) has projected peak demand to touch 260GW in FY25.

Increase in gas-based generation
Gas-based generation, Elara Capital said, surged by 117 per cent YoY to 5.2BU, driven by the Government’s directive to operationalise all gas-based plants under Section 11. In April and May, gas-fired power generation doubled to 8.9BU versus April-May 2023 level. The share of gas in power generation almost doubled to 3.1 per cent from 1.6 per cent the previous year. Plant load factor for gas-based stations improved to 27 per cent in May 2024 from 15 per cent in May 2023.

India’s coal production rose 10 per cent YoY to 84MT. Production of CIL increased 7.5 per cent YoY to 64MT. Overall coal dispatch rose 10 per cent to 91mn tonnes in May 2024 from approximately 82mn tonnes in May 2023.

CIL’s dispatch also rose sharply – 69mn tonnes in May 2024, up 8.5 per cent YoY. Cumulative coal production till May 2024 was reported at 162mn tonnes, up 8 per cent from approximately 149mn tonnes in May 2023. Cumulative coal dispatch for the same period rose to 175mn tonnes, up 8.2 per cent, from 162.56mn tonnes in FY24.

The Ministry of Coal has set a production target of 1,080mn tonnes in FY25. Cumulative coal production by CIL YTDFY25 was 126mn tonnes, up 7 per cent YoY. CIL has set a target to produce 838mn tonnes of coal in FY25.

Expectations from Modi 3.0
According to Elara Capital, policy reforms and new initiatives in the power sector will continue under Modi 3.0. With power demand growing at a 7 per cent compound annual growth rate (CAGR) and peak deficit increasing accordingly, the report stated, the government is likely to prioritise incentivising private sector investments in large-scale battery energy storage systems. Transmission, generation and distribution segments may also see renewed emphasis, it added.

Meanwhile, Mohan Lal Khattar has been appointed as the Union Minister of Power, following his tenure as the Chief Minister of Haryana. Expectations from the new minister are strong, on his many power sector reforms during his time as the chief minister of Haryana, that led to strong operational and financial performance of the state’s distribution companies. “Expect the new power minister to continue focusing on infrastructure upgrades, transformer replacements, improving the financial condition of power distribution companies (discoms), and prioritising the expansion of renewable energy sources (solar, wind, green hydrogen),” Elara Capital said.

Indian Energy Exchange (IEX) achieved an overall monthly volume of 10,633MU in May 2024, marking a 28.9 per cent YoY increase. The electricity volumes at 9,568MU increased 21 per cent YoY. Renewable energy certificates (RECs) at 1,055MU increased 640.3 per cent YoY.

IEX Green Market, comprising the Green Day-Ahead and Green Term-Ahead Market segments, achieved 622.2MU volume in May 2024 as compared with 357.7MU in May 2023, up 73.9 per cent YoY.

The Real-Time Electricity Market (RTM) reported the highest ever monthly traded volume in May 2024. RTM volume rose to 3,352MU in May 2024, from 2,424MU in May 2023, up 38.3 per cent YoY. On an average, less than 100MUs were traded daily in the RTM segment in May 2024.