Powerful Q4 anticipated for power sector

The power sector is in focus given the advent of seasonal demand and hopes of higher economic activity.

- DEVANGSHU DATTA

Market consensus is that the January-March quarter (Q4) of 2024-25 (FY25) will see good returns for the sector.

Peak demand was up 14 gigawatt (Gw) year-on-year (Y-o-Y) in Q4FY25 but merchant prices did not rise much due to 4.1 Gw thermal capacity additions in FY25. In the nine months ended December 2024, total wind power addition was 2.3 Gw, and 15.5 Gw of wind-related capacity was awarded.

Coal-based generation increased 2 per cent Y-o-Y to 341 billion units (BU) in Q4FY25. Hydro generation increased 23 per cent Y-o-Y to 25BU. Gas-based generation declined 30 per cent Y-o-Y to 5BU. Renewable generation increased 25 per cent Y-o-Y to 60BU.

For Q4FY25, IEX achieved the highest-ever quarterly electricity volume of 31,747 million units (MU), an 18 per cent Y-o-Y increase.

Cumulative all-India electricity demand over January-March was about 416BU compared to 400BU for January-March 2024.

Merchant prices did improve somewhat quarter-on-quarter (Q-o-Q) but may be flat Y-o-Y. Coal production and prices were soft.