After signs of improvement over November 2019-February 2020, the all-India energy demand in March 2020 decreased 8.9% year-on-year to 98.8 billion units (BU) while energy supply decreased 9.2%. This resulted in the energy deficit remaining at 0.4% (same as in March 2019)—according to a report by India Ratings.
Despite a reduced power demand in March 2020, the energy demand for FY20 was still higher by 1.2% yoy.
India Ratings added that a recovery in the power demand—which declined for March and April 2020, amid the Covid-19 led lockdown—remained uncertain due to the uncertainty around any relaxation of the timelines of the lockdown period amid rising cases and its impact on economic growth.
No impact on ‘must run’ renewables
The reduced demand drove electricity generation down, mainly from thermal sources even as renewables were unaffected due to ‘must run’ status accorded to them.
“With the decrease in demand, electricity generation (excluding renewables) also decreased 8.8% yoy to 97.7 BU in March 2020 with thermal generation declining 11.1% yoy. Thermal plant load factor (PLF) declined to 52.6% in March 2020—against 60.4% in February 2020 and 62.9% in March 2019—on account of the lower demand,” stated India Ratings.
“Thermal PLFs were impacted most due to the decline in the power demand in March and April 2020, given the must-run status of nuclear, hydro and renewable,” it said, adding that thermal PLFs are expected to remain low on account of the extension of lockdown.
The report added short-term power price at Indian Energy Exchange was lower at Rs 2.46/kWh in March 2020 (compared to Rs 3.12/kWh in March 2019), as the difference in buy and sell bid volumes widened to negative 7,662 million units.
“The traded volume on short-term power market increased 18.3% yoy to 3,971 MU on account of favourable prices on the exchange for both distribution companies and open access buyers.”