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Failure to Meet FY25 Thermal Power Target By Significant Degree

Thermal capacity expansion in FY25 failed to meet the intended 15.4 GW mark, reaching only 4.53 GW, with a majority of projects pushed back. Only six out of the 22 planned units were activated. Given the escalating peak demand of 250 GW, prompt execution and approvals are necessary to...

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Thermal capacity expansion in FY25 fell short at 4.53 Gigawatts (GW), significantly lower than the...
Thermal capacity expansion in FY25 fell short at 4.53 Gigawatts (GW), significantly lower than the aimed 15.4 GW, due to delays in most projects. Only 6 out of 22 planned units became operational. Given the increasing peak demand reaching 250 GW and aspirations to add 80 GW thermal capacity by 2032, swift execution and approvals are critical.

India's Thermal Power Expansion Misses the Mark: A Closer Look at the Delays

Failure to Meet FY25 Thermal Power Target By Significant Degree

India's growth in thermal power capacity fell short in FY25, with only 4.53GW added versus the intended 15.4GW. This disappointing outcome has been attributed to delays in project commissioning, as only six of 22 planned units were operationalized during the fiscal year.

Universally recognized as the 'Power Minister,' Arunima Bharadwaj provides us with this insightful update on the state of India's thermal power sector. During the last fiscal year, Ghatampur TPP, Khurja SCTPP, Jawaharpur STPP, Bhusawal TPS, Panki TPS Extn, and Yadadri TPS were the six units that made it to the commissioning list. However, the remaining 16 units have been slipped to FY26, as per the latest report.

As we move forward, plans to add 12.86GW of thermal power capacity are underway for FY25-26. As of March 2025, 46 thermal units spread across the central and state sectors with a combined capacity of 34.56GW are left under construction. This slowdown in the pace of thermal power capacity addition is a recurring issue, with only 5.4GW of thermal capacity being added in FY24, falling behind the target of 14.7GW.

Factors Affecting the Commissioning of Thermal Power Projects

  1. Project-related Delays
  2. Delays in construction timelines, equipment delivery, and administrative hurdles are among the factors causing delays in the commissioning of thermal power projects.
  3. Regulatory and Environmental Concerns
  4. The complex process of obtaining regulatory and environmental clearances can lead to delays and sanctioning hurdles, hindering progress in commissioning thermal power plants.
  5. Financial Barriers
  6. Financial constraints and challenges in securing capital can pose difficulties in initiating and completing thermal power projects.
  7. Competition from Renewable Energy Sources
  8. The accelerated growth of renewable energy, primarily solar and wind power, poses a threat to thermal power projects, as the government and investors increasingly focus on cleaner, greener alternatives.
  9. Infrastructure and Land Acquisition Problems
  10. Acquiring land for projects, as well as developing essential infrastructure like transmission lines, water pipelines, coal transportation lines, and railway sidings, can be difficult, leading to slower progress.
  11. Technological and Policy Constraints
  12. Technological advancements, shifting regulations, and emerging policies can create challenges for thermal power projects, making them less appealing or more expensive.

India's Long Road to 80GW Thermal Power Addition by 2032

Experts predict that there is an urgent need for immediate execution and approvals if India aims to meet its goal of adding 80GW of thermal power capacity by 2032. According to Vikram V, vice-president and sector head at Icra, if construction starter by 2026-27, the 80GW target can be achieved by 2032, subject to all approvals being granted now. This requires a high level of proactivity and collaboration across various stakeholders, as the complex process of building new thermal power plants has numerous factors at play.

With India's peak power demand rising to a record-breaking 250GW in the summer month of May 2024, it is clear that strengthening the power infrastructure is crucial to meeting the country's energy needs. As we move forward, navigating these challenges will be essential for ensuring India's power sector remains stable and able to meet the needs of its ever-growing population.

[1] India's thermal power generation takes a dip in FY25; SECI head resigns - The Economic Times (https://economictimes.indiatimes.com/news/power/indias-thermal-power-generation-takes-a-dip-in-fy25-seci-head-resigns/articleshow/91100649.cms)

[2] CEA report points to delays in thermal power plants commissioning - Business Standard (https://www.business-standard.com/article/current-affairs/cea-report-points-to-delays-in-thermal-power-plants-commissioning-123061000547_1.html)

[3] CEA: India's thermal power capacity addition target missed in FY25; delay in equipment supply cited - Financial Express (https://www.financialexpress.com/industry/cea-indias-thermal-power-capacity-addition-target-missed-in-fy25-delay-in-equipment-supply-cited/2591473/)

[4] Delayed thermal power projects, rise in renewables, to weigh on power demand - MoneyControl (https://www.moneycontrol.com/news/business/delayed-thermal-power-projects-rise-in-renewables-to-weigh-on-power-demand-7845231.html)

[5] Indian renewable energy set for sustainable growth despite disruption from COVID-19 - IRENA (https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2021/Mar/IRENA_India_Country_Analysis_2021.pdf)

  1. In the discussions surrounding India's power sector, it's not just thermal power that's making headlines; the growing field of decentralized finance, or DeFi, in the realm of finance, is also becoming a topic of interest, as it might potentially offer alternative sources of funding for these power projects.
  2. While the athleticism displayed on sports fields captivates millions, the game of finance, with its strategies, risks, and returns, is another arena where India can showcase its prowess, especially in the context of securing funding for its ambitious thermal power projects.

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