The overall power capacity addition during financial year 2021 has taken a hit due to the Covid-19 pandemic. While the net conventional power capacity addition in FY 2021 stood at about 3 GW as against 4.5 GW YoY, the renewable energy power addition in the first 11 months of FY21 was at 6GW as against 9.5GW in the previous fiscal.
There has been a steady upstick in peak demand in the country with the average peak demand in March 2021 recorded a 2-year CAGR of 6 per cent, with thermal generation growth at the same level, according to a Power Sector update from Emkay Global.
Further capacity addition took a hit due to Covid-19 in both conventional and renewable spaces. Conventional power addition in FY 2021 was down 33% to 3GW, while RE addition (in 11 months till February 21) was also down to 6GW from 9.5GW.
While there has been a steady uptick in power demand, the average peak demand till date in April 2021 is up 4 per cent as against 6 per cent growth in March 21. It was down largely due to fresh restrictions related to the second wave of Covid-19 infections.
The country’s thermal power plant load factor (PLF) has improved in last few quarters. The thermal generation was up 12 per cent YoY during the quarter. Thermal PLF during H2 FY21 stood at 59.5 per cent versus 54 per cent in H2FY20.
During March 2021, the thermal PLF at 66.5 per cent was the highest since March 14 for the month. In second half of FY21, PLF of NTPC units stood at 70 per cent as against 66.5 per cent YoY.
Strong RE pipeline
While the RE addition has been weak in the current fiscal, the pipeline of projects has increased in the last one year. The solar pipeline as of calendar year 2020 stood at 47.5GW as against 24GW at the end of CY19. Further during FY21, 20GW of Utility Solar projects have been auctioned.
Key renewable bids in March 2021 include that of GUVNL’s 500 MW Tender Phase II (bid at ₹2.2/kwh) which was won by NTPC, Coal India and SJVN. And SECI’s 1200MW Wind project Tranche X (bid at ₹2.78/kwh) was won by Adani Renewable, JSW Future Energy and others.
Stable coal Plant Load Factor, steady increase in power demand and strong capacity addition in the medium term bode well for NTPC. Due to it’s competitive approach, NTPC has featured in majority of the winning bids for solar projects in the last few months.