Power deficit drops to less than 1 per cent in 2016-17

India’s power deficit dropped to a historical low of less than 1% last fiscal, thanks to record electricity generation capacity added over the last few years, adequate coal stocks and transmission facilities, coupled with meager growth in electricity demand.

A senior official in the Central Electricity Authority (CEA) said the deficit was lowest since the CEA started maintaining the reports in 1992.

Power deficit is calculated by states as the difference between electricity requirement raised by distribution companies and electricity supplied, and cannot be directly correlated to hours of power outages and the latent demand in unelectrified villages, the official said.

Debasish Mishra, Partner at Deloitte Touche Tohmatsu India LLP, attributed the low deficit situation to high generation capacity addition in the last five years even as “the growth in demand for electricity has been below expectations because of an industrial slowdown”.

The demand-supply gap for power in the period between April 2016 and March 2017 was at 0.7%, down from 2.1% in FY16, CEA data showed. In March, the deficit was at 0.3%, the lowest for any month, down from 0.5% in February.

Power deficit drops to less than 1 per cent in 2016-17

The All India electricity requirement grew 2.5% year on year to 11.42 lakh million units in the last financial year, CEA data showed. In FY16 the growth was 4.2% at 11.14 million units.

Mishra said the outlook for power sector was positive as the deficit has reduced from double digits in FY09 and FY10.

“Gone are the days when power sector was blamed for the loss of 1%-2% GDP growth. First time in many decades, with ample and reliable power, the sector will be an enabler to economic expansion,” he said.

However, the electricity demand is likely to increase in the summer months due to heat wave conditions, as reported by ET on Monday. The government’s Vidyutpravah portal showed that power demand increased to 154 GW on Wednesday, pushing prices on the power exchange to Rs 4.2 per unit. The country has installed capacity of 319 GW.

All India peak energy shortage — the maximum demand requirement faced by the country — in last financial year was at 1.6%, down from 3.1% in the previous year.

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