The fall, captured in official data released by Power System Operation Corporation (POSOCO), is attributed to the slump in the economic activity in the wake of the ongoing lockdown due to the coronavirus outbreak
New Delhi: The downward spiral in India’s power demand continues with peak demand falling 19 per cent during the first two weeks of May, despite the easing of lockdown restrictions post May 3.
The fall, captured in official data released by Power System Operation Corporation (POSOCO), is attributed to the slump in the economic activity in the wake of the ongoing lockdown due to the coronavirus outbreak.
Power demand in India has been falling since March in the wake of the ongoing nationwide lockdown to contain the spread of the Coronavirus pandemic. The government of India had extended the lockdown from May 3 for two more weeks, permitting considerable relaxations for industrial and construction activities to resume in the districts falling in the green and orange zones mapped in the country.
However despite the easing of lockdown restrictions for resumption of industrial activities, the fall in peak demand — the highest energy supply during the day — in the first two weeks of May, hovered between 15 per cent to 23 per cent. The average fall in demand between May 1 to May 14 was reported to be 19.05 per cent.
The drop in demand has already pulled spot power prices to the lowest level in more than two years and could spell further financial troubles for the ailing discoms. In April, the average power price in the market stood at Rs 2.42 per unit, registering a 25 per cent decline from Rs 3.22 per unit registered in the corresponding period last year.
Shubhranshu Patnaik, Partner at Deloitte India said that although it is not significant there is a gradual pickup in power demand, especially if you compare it with the period when the lockdown was immediately announced. Speaking on the revival of demand in the sector he said that it will take at least next three to four quarters for complete revival of power demand in the sector.
“The commercial segment has been the hardest hit during lockdown and the revival will only be gradual with time. For large scale industries we do see a revival but it is very difficult to predict any timeline for MSMEs, which have been so badly hit,” he said. He added that even if the commercial operations start in full swing it remains to be seen by when they will operate to their full utilisation.