More than a third of India’s 303 gigawatt thermal power capacity is lying unused while the rest is running at a shade over 55% utilisation owing to inadequate demand. Analysts said utilisation is expected to fall further if more capacity is added as planned by the government, portending losses for power firms. About 35% of the total capacity, or 104 gigawatt, is lying idle at present. The government added about 24,000 mw of fresh conventional capacity last year and plans to add 86 gigawatt by 2022. In addition, 100 gigawatt of solar capacity is to be added by 2022.
“Falling capacity utilisation translates into losses and inability of new power plants to service interest costs, leading to non-performing assets at banks,” said a senior analyst, who did not wish to be identified. The list of shut units includes a chunk of 31gigawatt capacity that was set up after 2009. These include 6,360 mw capacity that does have power supply contracts with distribution companies but is lying shut due to non-availability of coal. Another 5,650 mw have neither coal nor power supply contracts with any distribution company. The next set of 9,316 mw have coal supply contracts but does not have power supply agreements.