MUMBAI : With the re-imposition of lockdown restrictions in many parts across the country, the all India electricity demand is likely to decline by 5% to 6% in FY21 over FY20, against an earlier estimate of 1% made in April 2020, a report by credit ratings agency ICRA said. The revised energy demand estimate assumes demand decline of 3.5 – 4% in Q2 and Q3 FY2021 and a marginal recovery of about 1% in Q4 FY2021, given the slower pace of recovery expected in industrial and commercial activity in the country.
Power generators will see their plant load factors (PLFs) falling as a result. ICRA estimated that the fall in demand will supress the thermal PLF on an all India level to about 50-51% in FY2021 against the agency’s earlier estimate of 54% and actual PLF of 56% in FY2020. The all India electricity demand declined by 16.2% in Q1 FY2021 on a year-on-year (Y-o-Y) basis, because of the lockdown imposed to control the Covid-19 pandemic.
“The decline in energy demand has adversely impacted the revenues and cash collections for the power distribution utilities (discoms), especially given that the bulk of the consumption decline has come from the high tariff paying industrial and commercial consumers; and given the delays in cash collections from other consumer segments,” Sabyasachi Majumdar, Group Head & Senior Vice President – Corporate ratings, ICRA, said.
