The demand-supply mismatch in the power sector is likely to balance out in the next four to five years as industrial growth picks up, Power Secretary PK Pujari said at the ETEnergyWorld launch on Thursday.
With excess capacity affecting returns on investment, private players are unlikely to make additional investment in setting up new thermal power projects. At the same time, industrial demand will lead to increased consumption of power. This, according to Pujari, is expected to balance the current excess supply of power.
At present, power demand is growing at around 5% while capacity addition has been at the rate of 10%, resulting in the mismatch.
This year, the sector added about 23,000 mw, against the target of 20,000 mw.
While the average capacity utilisation of thermal power plants is about 60%, a closer look shows that central public sector units have load utilisation of about 70% and private producers around 65%. Power companies owned by states are a drag on the overall performance, running at just around 53% of their capacity.
