Rating agency Icra has said demand for electricity in India is expected to grow 6 per cent in current financial year (FY22) as compared to the previous fiscal year. It has also estimated power generation capacity addition at 17- 18 GW for the ongoing fiscal year. It has estimated the all India electricity demand growth at 6.0 per cent for FY2022 on a year-on-year (YoY) basis, considering the favourable base effect, relatively lesser impact of the second wave on electricity demand and the pick-up in the vaccination programme.
It said the electricity demand slowed down during the first two months of 2021-22 compared to March 2021 amid lockdowns imposed by state governments to control the second wave of COVID-19. Nonetheless, , it stated with the slowdown in fresh COVID-19 infections from the second half of May 2021, state governments eased lockdown restrictions and this in turn improved the electricity demand growth prospects as seen in June 2021, with a month-on-month growth of 3.9 per cent.
However, it added that any resurgence in infections leading to lockdown restrictions would remain a key downside risk for the demand. Further, Icra said it expects the all-India power generation capacity addition to rebound to 17-18 GW in the year, increasing by 45 per cent YoY from 12.8 GW in 2020-21, mainly led by the renewable energy (RE) segment backed by a strong pipeline of 38 GW projects under development.