India's Power Shortages Jump to Three-Year High

India's electricity consumption surged to a three-year peak in September, driven by El Niño and growing industrial demand. The shortfall reached 560 million kilowatt-hours, the highest since August 2023, according to Grid-India data. Overall electricity generation increased by 11.3% compared to the same period last year. Both coal-fired and renewable energy generation rose, but higher residential and industrial demand, coupled with El Niño-induced low rainfall and temperatures, strained the Indian power mix.

Despite coal-fired power plants running at higher capacities to meet the demand, the shortfall persisted. Coal-fired generation climbed by 13.3% year-over-year, and its share of total electricity generation rose to 66.03% in September from 64.6% in August, per Reuters. While renewable power generation surged by 25.1%, its share in India's electricity generation fell to 17% from 19.5% in August.

The share of coal-fired power plants operating with critically low coal inventory surged to nearly 40% of all operational coal plants. Many coal-fired plants saw their coal stocks dip below the critical 25% threshold due to rising electricity demand and monsoon disruptions. India's coal demand is set to rise by 4.2% to 1.353 billion tons this year, reversing a slight drop last year, as per the International Energy Agency's Coal Mid-Year Update 2026.