Coal Power may Have Already Passed its Peak, if India Delivers its RE Targets

An analysis by energy think tank Ember has revealed that coal power has continued to decline in India since reaching a peak in 2018.

An analysis by energy think tank Ember has revealed that India’s coal power has continued to decline since reaching a peak in 2018. Coal-fired electricity generation in India fell 5 percent in 2020 due to significantly reduced annual electricity demand as a result of the COVID-19 lockdown. It is the second consecutive year that coal power has fallen, with coal generation down 8 percent in 2020 compared to 2018.

Coal still remains the dominant source of electricity, generating 71 percent of India’s electricity in 2020, however it might have very well passed its peak if India can deliver on its ambitious solar and wind energy targets.

The study analyses new data from India’s Central Electricity Authority (CEA), showing that coal fell by 51 TWh (5 percent) in 2020, caused by a 36 TWh (3 percent) fall in electricity demand and a 12 TWh (3 percent) rise in solar generation. As coal-fired generation fell and coal capacity continued to rise, India’s coal plant load factor (PLF) fell to a record low level of 53 percent in 2020.

Ember’s report demonstrates that India’s coal-fired generation will continue to plateau this decade if electricity demand is structurally impacted by COVID-19. With electricity demand projected to grow just 4-5 percent every year until 20301, the study calculates that there would only be a small (52 TWh) increase in coal-fired generation by 2030. The analysis draws on data from the International Energy Agency, demonstrating that the recent India Energy Outlook 2021 report supports the conclusion that coal power will plateau and could even fall this decade.

This new trajectory puts India on a more climate-friendly pathway. However, Ember’s report reveals that this is dependent on India delivering its 2022 target for wind and solar generation, which would require more than double the generation seen in 2020 (118 TWh).

Aditya Lolla, Ember’s senior analyst said “it seems increasingly likely that coal power will plateau in the 2020s in India. But, there is still a risk that India could be knocked off course. As India recovers from the COVID-19 pandemic shock, the choices it makes in the next decade will make or break its coal-to-clean electricity transition. Now the focus must be on building enough new solar and wind capacity to meet increasing electricity demand. 

“That would mean the new wave of coal plants coming online in the next few years can be used to replace India’s oldest and dirtiest coal plants. As the world’s second-largest coal generator, all eyes are on India in this crucial decade of climate action.”

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Ayush Verma

Ayush Verma

Ayush is a staff writer at saurenergy.com and writes on renewable energy with a special focus on solar and wind. Prior to this, as an engineering graduate trying to find his niche in the energy journalism segment, he worked as a correspondent for iamrenew.com.

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