All-India energy demand shows signs of recovery

India Ratings and Research (Ind-Ra) has published the June 2020 edition of its credit news digest on India’s power sector. The report highlights the trends in the power sector, with a focus on capacity addition, generation, transmission, merchant power, deficit, regulatory changes and the recent rating actions by Ind-Ra.

In June 2020, the all-India energy demand contracted 10.9% yoy for the fourth consecutive month to 105.6 billion units, while energy supply also decreased 10.9% yoy, resulting in the energy deficit remaining at 0.4% (June 2019: 0.5%).

The power demand declined for June 2020, amid the Covid-19 led lockdown, on account of a decline in commercial and industrial demand from major manufacturing states such as Maharashtra (down 17.1%), Gujarat (down 10.2%) and Tamil Nadu (down 10.3%).

The energy demand is showing signs of recovery as the decline in power demand narrowed in June 2020 (down 10.9%; May 2020: down 14.9%; April 2020: down 22.3%) due to the gradual lifting of lockdown for certain economic activities and an increase in domestic consumption with the extended summer season. The energy demand also showed a 2.9% mom improvement over May 2020.