Power Demand Growth Slows In November, Helping Ease Coal Shortage

The country's electricity demand grew 2.2 per cent in November, slower than the 4.1 per cent increase in October, a Reuters analysis of government data showed, helping the nation tide over a crippling coal shortage that caused widespread power cuts.

Surging power demand and high global prices in October left utilities scrambling for coal, India's dominant fuel for power generation, despite record supplies from state-run Coal India, which has a near-monopoly of production.

Average daily coal-fired power generation in November was down 2.8 per cent from October, an analysis of load dispatch data from federal grid regulator Power System Operation Corporation Ltd (POSOCO) showed.

The number of plants having supply agreements with Coal India with inventories of three days or less fell to 31, as of Nov. 29, latest data from the federal power ministry shows, compared with 44 out of the 135 plants in October.

The average coal inventory held by power plants would last nine days, higher than six days on Oct. 31, but still lower than the average of 12 days three months ago.

Dependence on coal for electricity generation rose to 75.2 per cent in November, compared with 70.6 per cent in October, though the total electricity production from coal fell.

India's renewable output typically slows in the first and last quarters every year due to lower generation from sources such as hydro, solar and wind, increasing dependence on coal.

The rise in power demand last month was driven by growth in electricity consumption in India's most industrialised state Maharashtra.

Other industrialised states such as Karnataka and Tamil Nadu registered a decline in power use, while Gujarat's consumption growth was largely flat.