According to data from Grid Controller of India, the country’s power grid recorded an average daily electricity shortfall of around 4 gigawatts during the first 10 days of October.
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New Delhi: Coal stocks at the country’s power plants are rapidly depleting, with the impact beginning to spread across the economyIndian factories, smelters and households are facing power cuts and rising energy costs, according to a Bloomberg report.
India’s weakest monsoon since 2015 has reduced hydropower generation, while above-normal temperatures have increased electricity demand for air conditioning and agricultural irrigationThis has accelerated the depletion of coal stocks at coal-fired power plants, which supply nearly two-thirds of India’s electricity.
Supply Falls Short of Demand
With electricity supply falling short of demand on the grid, small factories, farmers and households are facing power cutsMeanwhile, large industrial consumers in sectors such as metal smelting, chemicals and paper are struggling to secure enough fuel to generate their own electricityThis is because state-owned Coal India Limited is prioritising supplies to grid-connected power generators.
Small steel mills in Chhattisgarh are facing power cuts lasting 10 to 12 hours a day, forcing them to reduce production, said Manish Dhuppad, general secretary of the Chhattisgarh Mini Steel Plant Association.
According to Dhuppad, mills require an uninterrupted power supply“Suppose there is hot metal inside a furnace and the power goes out just before it is about to be taken outBy the time electricity is restored, the material solidifiesWe have to melt it all over again,” he said.
Adverse Impact on the Economy
The electricity shortage highlights the growing impact of extreme weather on India’s economyThe weak monsoon has been attributed to El NiñoIt also underscores how the country’s continued dependence on fossil fuels is limiting its ability to cope with a changing climate.
According to the Ministry of Power, by October 10, nearly half of India’s coal-fired power plants had fuel supplies below one-quarter of the required levelDelayed monsoon rainfall last month in the country’s eastern coal-mining regions further aggravated the shortage, reducing production and disrupting the transportation of fuel by rail.
Industries Grapple with Power Cuts
Households and industries in Punjab are facing prolonged power cutsBadish Jindal, who operates a steel wire plant in Ludhiana, said repeated power cuts lasting three to four hours have increased energy costs because his factory has had to rely on expensive backup generators.
“The power cuts have no fixed scheduleThis makes it difficult to plan our operations and deliveriesProduct quality is also affectedThe sudden shutdown and restarting of machines when the power goes out and comes back increases the risk of accidents,” he said.
Data from Grid Controller of India shows that the country’s electricity grid faced an average daily shortfall of around 4 gigawatts during the first 10 days of OctoberAccording to Bloomberg’s calculations, this amount of electricity would be sufficient to power approximately two million rural households in India.
Another Factor Behind the Crisis
Rajiv Agrawal, secretary-general of the Indian Captive Power Producers Association, which represents large industrial consumers, said the policy of prioritising grid-connected power plants had put companies that generate their own electricity from coal at a significant disadvantage.
He said these companies are being forced to pay higher prices at Coal India’s auctions while also purchasing expensive electricity from the gridAccording to him, companies are also having to wait for months to secure rail transportation for coal.
As a result, businesses with limited working capital have been forced to cut production.
