In order to close the anticipated demand-supply imbalance, the Ministry of Power is planning to install 97,000 MW of thermal power capacity based on coal and lignite by 2034–35, the Centre informed Parliament on Monday.
With an existing base of 211,855 MW as of March 31, 2023, the Central Electricity Authority (CEA) projects a thermal capacity requirement of approximately 307,000 MW by FY35. To remedy this deficiency, the capacity addition is being suggested.
Roughly 17,360 MW of thermal capacity has been put into operation from April 2023. There are an extra 22,920 MW of contracted capacity and an extra 39,545 MW of strained projects now in the works. According to Shripad Naik, the minister of state for power, 24,020 MW have been identified at different levels of planning, according to a written reply he gave in the Rajya Sabha.
Depending on demand growth and the addition of renewable capacity, the predicted Plant Load Factor (PLF) for coal-based plants is estimated to be about 61% by 2031-32.
CEA’s model for planning generation expansion takes into account capital costs, fuel costs, operating and maintenance expenses, plant life and operational characteristics, and the ideal combination of coal, hydro, solar, wind, storage, and nuclear capacity.
Over the last three years, the all-India weighted average rate of sale of power (WARSP) from existing coal plants has fluctuated between 4.36 and 4.58 rupees per kilowatt-hour (kWh), with the lowest tariff coming in at approximately 1.52 rupees per kWh.
Competitive bidding in 2025 for new coal-based plants found rates between 5.38 and 6.30 rupees per kilowatt-hour.
In contrast, SECI-awarded firm and dispatchable renewable energy (FDRE) projects in August 2024 found rates ranging from Rs 4.98 to Rs 4.99 per kWh.
Since coal-based and renewable projects differ in operational features, fuel cost structures, risk allocation, and system needs, the government pointed out that straight tariff comparisons are inappropriate.
