India Sinking Over ₹ 3 Lac Crores Building Idle Coal Plants

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Publication - September 30, 2016
India is facing a coal power bubble that will have serious impacts on existing plant operators as well as the banking/investment sectors.

An analysis by Greenpeace India finds that the country is heading towards an excess of coal power plants, more than needed to match the power demand projected for 2022, and will result in about ₹ 3,00,000 Crore of wasted investment into coal power plants. 

The analysis takes into account the growth rate of power demand, the capacity of coal power plants under construction and that are being proposed, India’s commitment to add 175 GW of renewable energy capacity by 2022 along with the upcoming capacity additions from other sources. 

The PLF which measures the capacity utilization of power plants has reached a historic low at an average of 62 percent in 2015. Despite this, 65 GW of new plants are still being built and over 170 GW are being proposed.  Assuming the 65 GW of under construction coal comes online by 2022, 95% of these will be lying idle. The 61.7 GW of idle plants represents a stranded capital of approximately 3,20,000  Crore rupees (49 billion USD).  

Power scenario briefing- overcapacity FInal Ver