India’s power sector is bracing for increased reliance on coal-fired generation over the next six to seven months, driven by the climatic impacts of El Niño. According to The Hindu BusinessLine, the weather phenomenon is altering atmospheric conditions in ways that suppress wind velocity and reduce rainfall. These changes directly impair the output of both wind turbines and hydropower facilities, which typically provide significant baseload power during the monsoon season. The Institute for Energy Economics and Financial Analysis (IEEFA) noted that generation trends for the July to September 2026 period were already negatively affected by these El Niño-related conditions.
The reduction in renewable output is quantifiable. IEEFA reported that hydropower generation, including small and large projects as well as imports from Bhutan, fell by 14.4 per cent year-on-year in the third quarter of 2026. This decline in clean energy supply coincides with a sharp rise in electricity demand. Warmer temperatures associated with the El Niño effect are driving a surge in the use of air conditioning, creating a dual pressure on the national grid. The combination of lower renewable generation and higher consumption is widening the gap between available supply and required electricity.
Analysts project that this supply-demand imbalance could reach 18 terawatt-hours (TWh) over a one-year period ending in June 2027. Saloni Sachdeva Michael, Charith Konda, and Kaira Rakheja of IEEFA stated that this potential shortfall would necessitate increased thermal power generation to maintain grid stability. Manoj Kumar, an analyst at the Centre for Research on Energy and Clean Air, previously highlighted that additional cooling demand alone could total 10 TWh within a year. This cooling load is equivalent to a quarter of Delhi’s annual electricity consumption.
Recent data underscores the severity of the demand spike. Crisil Intelligence expects India’s power demand to grow between 10 and 11 per cent year-on-year to reach 1,885 to 1,895 billion units in the financial year 2027. The pressure is already visible in October 2026, when power demand surged by approximately 22 per cent year-on-year to a record 160 billion units. Peak demand also rose by roughly 24 per cent to 261 gigawatts. With fossil fuel-based generation increasing faster than renewable sources in the third quarter, flexible resources like energy storage will be critical for managing this weather-related variability.