Cold Wave Pushes India Power Demand to Record January Peak

India’s power demand is projected to grow 1–1.5% year-on-year to 1,710–1,730 billion units (BU) in the current fiscal, driven by weather-related consumption and steady economic activity, according to Crisil Intelligence. The sector has remained highly weather-sensitive this year, with a harsh winter and stable industrial growth offsetting the impact of a prolonged monsoon.

Reflecting this trend, electricity consumption rose 4.5% year-on-year to about 143 BU in January 2026, marking the highest demand recorded for the month since at least 2010, based on provisional data from the Central Electricity Authority (CEA).

Increased Heating Demand 

A prolonged cold wave across northern and eastern India significantly increased heating demand. Between Jan. 8 and Jan. 14, minimum temperatures were 2–4°C below normal across parts of western and northwestern India, pushing northern region demand up about 5.5% year-on-year.

Manufacturing activity also supported electricity consumption. India’s Manufacturing Purchasing Managers’ Index rose to 55.4 in January from 55.0 in December, signalling continued expansion. Industrial and commercial consumers account for roughly half of India’s power demand.

January peak demand surpasses summer record

Peak electricity demand reached 245 GW during the month, surpassing the previous record of 243 GW set in June 2025. The new peak occurred on Jan. 9 during the height of the cold wave, highlighting the growing role of winter demand in India’s power consumption profile.

For the April–January period, overall power demand rose about 0.9% year-on-year.

Short-term power market activity surges

Stronger demand led to a sharp rise in short-term power market activity. Volumes in the Real-Time Market (RTM) increased 52.8% year-on-year to 4,638 million units in January.

Despite higher demand, prices declined due to ample supply. The average market clearing price in the RTM fell 16% to Rs 3.72 per unit, while Day-Ahead Market prices declined about 13% to Rs 3.86 per unit.

Lower exchange prices enabled distribution companies and large industrial consumers to procure cheaper electricity, replacing costlier contracted power in some cases. On Feb. 2, Maharashtra State Electricity Distribution Company Ltd purchased 687 MW from the exchange due to lower generation availability from contracted plants.

Generation rises across all fuel sources

Electricity generation increased 6% year-on-year to 156 BU in January, with renewable generation rising 10% year-on-year supported by capacity additions of nearly 39.65 GW during April–January of the fiscal year.

Coal-based generation increased about 5% year-on-year, with its share rising to around 74% of total generation in January, highlighting coal’s role in balancing demand. Hydro and nuclear generation rose 11.8% and 5.3%, respectively.

Coal inventories remained comfortable, with thermal power plants holding about 56 million tonnes of stock at the end of January, equivalent to 18 days of consumption.