New Delhi, Mar 4 (KNN) India’s electricity demand is forecast to grow at an average annual rate of 6.3 per cent over the next three years, outpacing the 2015-2024 average growth rate of 5 per cent, according to the International Energy Agency (IEA).
This robust growth is being driven by economic expansion and increasing air conditioner ownership throughout the country.
The IEA projects that India will account for approximately 10 per cent of the global increase in electricity demand by 2027, highlighting the country’s significant contribution to worldwide energy consumption.
This forecast underscores the urgent need for the Indian government to ensure that electricity supplies can meet rising demand without shortages.
India’s electricity consumption grew by 5.8 per cent in 2024, following an 8.3 per cent increase in 2023, reflecting the country’s strong economic performance.
The first half of 2024 saw particularly high growth at 8.5 per cent due to intense and prolonged heatwaves, while growth moderated in the second half amid milder weather conditions.
Peak electricity load in India has increased dramatically over the past decade, rising from 148 GW in 2014 to 250 GW in 2024.
This surge has been fueled by rapid industrial expansion, agricultural development, improved electricity access, and growing use of air conditioning and appliances in residential and commercial sectors, resulting in a 60-65 per cent increase in electricity demand across these sectors during this period.
Despite less than 20 per cent of Indian households currently owning air conditioners, cooling equipment already contributes approximately 60 GW to the total peak load in 2024.
Air conditioner sales reached a record 14 million units in 2024, representing a 27 per cent increase from 2023. By 2030, the IEA expects cooling equipment to contribute one-third of India’s peak electricity load, potentially reaching 140 GW.
The impact of temperature on electricity demand is becoming increasingly significant. In 2024, each incremental degree in daily average temperature resulted in more than 7 GW of additional peak demand, double the increase observed in 2019. By 2027, this sensitivity could exceed 11 GW per degree, according to the IEA.
India’s National Electricity Plan 2023-2032 forecasts peak demand to reach 458 GW by 2032, representing an 83 per cent increase from 2024 levels.
However, capacity shortfalls remain a critical issue. Data from the Central Electricity Authority indicates that available capacity at peak load times was projected to be 11 GW lower than actual peak load levels in 2024.
Electricity adequacy is particularly challenging in India’s northern and eastern regions, where power requirement deficits reached -7.3 per cent and -7.9 per cent respectively, despite capacity increases of 6.6 GW and 1.3 GW over the previous year.
While coal-based power generation currently accounts for 74 per cent of India’s total electricity generation, its share is expected to decline to 67 per cent by 2027.
The IEA projects coal-based power generation to grow at only 2 per cent between 2025-2027, compared to 4 per cent from 2018-2024. Meanwhile, gas-based power generation is rising, with an estimated growth of 6 per cent year-on-year in a24, and is forecast to increase at an average of 9 per cent annually over the next three years.
(KNN Bureau)
