Power consumption continues to contract, down 5.5% in Nov

Electricity consumption in the country fell 5.5% year-on-year (y-o-y) to 95 billion units (bu) in November, recording the fourth straight month of contraction. The decline was a steep 12% in October. The continuance of the decline in power consumption belies the government’s claim that extended monsoon was the only reason behind the contraction in power demand in August-October.

Power demand grew just 1.5% in April-October this year, compared to an average growth of near 5% in the past five years. “For the past 10 years, the ratio of power demand growth to real GDP has been around 0.8. This implies that the sharp decline in power demand is symptomatic of a slowing economy,” Moody’s wrote recently.