The Indian electricity sector is going through a major transformation that has changed the outlook for the sector. India’s power sector has a bright future, and the country’s need for electricity is still being driven by steady economic expansion. The Government of India’s commitment on obtaining ‘Power for all’ has expedited capacity addition in the country. To prevent power shortages, India’s overall power generation capacity must rise from 442 GW in FY24 to 673 GW. According to the paper, this expansion will encourage more investment in thermal power, which is anticipated to be crucial for preserving grid stability. It said that there are large projections for capacity additions, particularly in thermal power, where the yearly addition rate is expected to jump from the present 2–5 GW to 17 GW. The capacity of renewable energy will increase quickly, in pace with traditional energy sources. It anticipated that between FY24 and FY27, the annual capacity expansion for renewables would rise 3.5 times compared to FY10–20.
The nation’s thermal power plants, which now have a plant load factor (PLF) of between 65 and 70 percent, will be essential in supplying this demand. With thermal utilisation rates already reaching 74% in FY25, it is predicted that the average annual PLF for thermal power plants will surpass the high levels recorded in FY08 by FY28. It was made clear that years of underinvestment in the industry are the reason why peak power shortfalls are occurring more frequently said Jefferies report.
Energy Generation Performance (Including RE)
The goal for the production of electricity (including renewable energy) in 2023–2024 was set at 1750 billion units (BU). i.e. an increase of roughly 7.2% over the 1624.158 BU that were actually generated in the preceding year (2022–2023). With an increase of almost 8.87%, the generation in 2022–2023 was 1624.158 BU, compared to 1491.859 BU in 2021–2022.
Total Generation and growth over previous year in the country during 2009-10 to 2023-24 :-
| Year | Total Generation (Including Renewable Sources) (BU) | % of growth |
| 2009-10 | 808.498 | 7.56 |
| 2010-11 | 850.387 | 5.59 |
| 2011-12 | 928.113 | 9.14 |
| 2012-13 | 969.506 | 4.46 |
| 2013-14 | 1,020.200 | 5.23 |
| 2014-15 | 1,110.392 | 8.84 |
| 2015-16 | 1,173.603 | 5.69 |
| 2016-17 | 1,241.689 | 5.80 |
| 2017-18 | 1,308.146 | 5.35 |
| 2018-19 | 1,376.095 | 5.19 |
| 2019-20 | 1,389.102 | 0.95 |
| 2020-21 | 1,381.855 | -0.52 |
| 2021-22 | 1,491.859 | 7.96 |
| 2022-23 | 1,624.158 | 8.87 |
| 2023-24* | 286.176 | -0.72 |
Upto May 2023 (Provisional), Source : CEA
| INSTALLED GENERATION CAPACITY (SECTOR WISE) AS ON 31.05.2023 |
| Sector | MW | % of Total |
| Central Sector | 1,00,055 | 24.0% |
| State Sector | 1,05,726 | 25.3% |
| Private Sector | 2,11,887 | 50.7% |
| Total | 4,17,668 |
| Installed GENERATION CAPACITY(FUELWISE) AS ON 31.05.2023 | ||
| CATAGORY | INSTALLED GENERATION CAPACITY(MW) | % of SHARE IN Total |
| Fossil Fuel | ||
| Coal | 205,235 | 49.1% |
| Lignite | 6,620 | 1.6% |
| Gas | 24,824 | 6.0% |
| Diesel | 589 | 0.1% |
| Total Fossil Fuel | 2,37,269 | 56.8 % |
| Non-Fossil Fuel | ||
| RES (Incl. Hydro) | 173,619 | 41.4% |
| Hydro | 46,850 | 11.2 % |
| Wind, Solar & Other RE | 125,692 | 30.2 % |
| Wind | 42,868 | 10.3 % |
| Solar | 67,078 | 16.1 % |
| BM Power/Cogen | 10,248 | 2.5 % |
| Waste to Energy | 554 | 0.1 % |
| Small Hydro Power | 4,944 | 1.2 % |
| Nuclear | 6,780 | 1.6% |
| Total Non-Fossil Fuel | 179,322 | 43.0% |
| Total Installed Capacity (Fossil Fuel & Non-Fossil Fuel) | 4,17,668 | 100% |
Source: OM SECTION
NTPC Growing Role In India Power Demand
The biggest integrated power producer in India, NTPC Ltd., had its highest-ever power generation of 422 BU in FY24, up 6% from the previous year.
In addition, NTPC revealed that, when compared to the same period the year before, coal production from its captive mines increased significantly by 83% during H1 FY 2023–2024. In comparison to 8.76 MMT in H1 FY23, the company’s remarkable coal production in H1 FY24 was 16.05 Mn Metric Tonnes (MMT). To increase the output of coal from its mines, NTPC has implemented a number of measures. Production at the operating mines has increased thanks to the deployment of high-capacity dumpers and an expansion of the fleet of excavators already in place.
To help the country to achieve its decarbonization objectives, NTPC has set the lofty target of using renewable energy sources to account for half of its installed capacity by 2032. In the fiscal year 2023, the company’s non-fossil portfolio saw growth of 24.24%. By 2032, about half of NTPC’s portfolio will consist of power capacity that is not based on fossil fuels.
The installed capacity of NTPC Group is 76,294 MW.
R. K. Singh on ‘The Power of Power’
Electricity, according to Union Minister for Power and New & Renewable Energy Shri R. K. Singh, is the most crucial infrastructure and is a requirement for development. He noted that the absence of load shedding is the primary distinction between developed and developing nations. “Without adequate power, no nation can advance. The electricity shortage in India has come down from roughly 4.5% in 2014 to less than 1% currently. By connecting 29 million homes in just 19 months, we have made universal access to electricity a reality. The International Energy Agency has dubbed this the largest and fastest expansion of energy access in the history of the power industry.
The Minister noted that one nation that has emerged as leading the energy transformation is India. “We have added renewable capacity at one of the fastest rates. Our capacity for renewable energy is 187 GW. By 2030, we want to derive 40% of our capacity from non-fossil fuel sources; as of right now, that percentage stands at 44%. We have increased our goal and will now have 65% of our capacity come from non-fossil fuel sources by 2030 instead of the 50% we had originally planned to have by then.
The power sector’s structural problems and their effects on state budgets
Discoms experience ongoing financial losses as a result of specific structural problems. Because of long-standing agreements with generation firms (gencos), their expenses are usually considerable. These contracts’ power purchase costs are fixed and do not take into consideration production efficiencies over time. Only every few years are tariffs revised in order to safeguard customers from supply chain disruptions. Consequently, expenses are carried over for a few years. Discoms also provide electricity at a discount to specific customers, such residential and agricultural ones. The primary means of recovery for this is expected to be subsidized payments given by state governments. States frequently, however, fail to make subsidy payments, which causes problems with cash flow and debt building. Furthermore, tariff recovery derived from the power sold is not optimal.
Future of Power
Clean hydrogen and carbon capture and storage are two essential technologies that can directly reduce emissions from power plants. BIL approved DOE’s billion-dollar investment in supporting infrastructure, including $2.1 billion in CO2 transportation infrastructure programs, $2.25 billion in CO2 storage, and $8 billion in clean hydrogen hubs. In order to encourage further private sector investments, such as Competitive Power Venture’s recently announced 1,800 GW natural gas combined cycle generator with carbon capture, the IRA established or increased tax credits for these technologies. All things considered, clean hydrogen and carbon capture technologies are now accessible because to government funding and incentives, as well as cost savings and performance enhancements brought about by decades of industry advancement.
