The demand for power in August 2020 was 2% less than that reported during the same month last year, data available with grid operator Power System Operation Corporation (Posoco) showed. India had registered a slump in power consumption for five months beginning August last year till January this year.
Electricity demand fell 4% against July this year but it is a normal phenomenon every year.
Maharashtra and Gujarat electricity demand was low by about 9% each than in August 2019. In July this year, Maharashtra had reported a 12% slump in its power demand year-on-year while demand in Gujarat was down by 17%.
Demand in Goa and Daman & Diu was low by 22% each while in Dadra Nagar Haveli by 18.3% over August last year. The other states to have reported more than 10% reduction in electricity demand year-on-year in August were Odisha and Delhi.
Electricity consumption in Andhra Pradesh and Tamil Nadu was lower by 5% over last year, while in Telengana it reduced by 6%.
“Diesel demand fall in August compared to July also shows that India’s industry and commercial recovery has stagnated,” said Debasish Mishra, leader-energy resources and industrial products for Deloitte India. “Having an overall weak electricity demand even prior to Covid-19 lockdown means it’s able to come close to last year’s demand, but that’s hardly any solace for the sector players as high paying industrial and commercial demand may be 10 to 30% lower than comparable numbers last year.”
Diesel consumption fell by about 20% in first two weeks of August as compared to the same period in July.
India’s power demand grew at slowest pace of 1.1% in 2019. In December 2019, the country’s power demand fell 0.5% from the year-earlier period, representing the fifth straight month of decline, compared with a 4.3% fall in November 2019. The fall in October 2019 was stark at 13% led by a sharp reduction in demand in Gujarat and Maharashtra.
However, power demand uptick was registered year-on-year in August in states like Madhya Pradesh, Jharkhand and Uttar Pradesh.
Girishkumar Kadam, sector head and vice president-corporate ratings at ICRA, said the imposition of lockdown to control the Covid-19 pandemic led to a decline in the all India electricity demand by 13.1% in the first four months of FY21. While the monthly demand recovered from 85 billion units (BUs) in April 2020 to 112 BUs in July 2020, it remained lower on a year-on-year basis.
ICRA continues to maintain its outlook for 5-6% decline in the all India electricity demand in FY21 over FY20.