India’s Electricity Generation Drops 1% as Industrial Activity Slows

Electricity generation in India experienced a decline in November 2023, driven by reduced industrial activity and mild weather conditions. This marked the second consecutive monthly drop in output, according to official data reported by Reuters. The total electricity generation for November reached 134.26 billion kWh, reflecting a 1% decrease compared to October. Last month’s output followed a more significant 6% decline from September.

Coal and Low-Carbon Generation Trends

The decline in electricity generation is largely attributed to a 5.8% annual decrease in coal generation, which remains the dominant source in India’s energy mix. As industrial demand weakened, the reliance on coal was impacted. Conversely, low-carbon electricity generation saw a remarkable increase, climbing 42% year-on-year. The total output from low-carbon sources reached 18.55 billion kWh, underscoring a significant shift towards renewable energy amid ongoing capacity expansions.

India has ambitious targets for expanding its renewable energy infrastructure, particularly in solar and wind power. In the first seven months of 2023, the country added a record high of 25.4 GW to its total installed solar capacity. Looking ahead, the government aims to achieve a total wind and solar capacity of 500 GW by 2030.

Challenges of Expanding Solar Power

Despite the rapid growth in solar capacity, challenges have emerged. The surge in intermittent generation from solar has heightened the risk of grid overload. Consequently, grid operators have implemented measures to curtail solar output during periods of low demand and high supply. Reports indicate that the rate of output curtailment has reached as much as 48% of total solar generation in some instances.

The National Solar Energy Federation of India has highlighted the financial implications of these curtailments. Since April 2023, solar generators have reportedly lost approximately $26 million in revenues due to reduced output.

Further complicating the situation is the lag in expanding the transmission network needed to support the growing solar capacity. As the installation rate of solar power continues to rise, the inadequacy of transmission infrastructure poses a significant barrier to achieving India’s renewable energy goals.

In summary, while India is making strides in renewable energy, particularly in solar capacity, the decline in overall electricity generation due to weakened industrial activity and the challenges associated with grid management remain pressing concerns for the country’s energy sector. As the nation seeks to balance its energy mix, careful planning and investment in infrastructure will be essential to support sustainable growth.