India has increased its use of coal for power generation in response to lower hydropower output from dry weather conditions. August saw the driest conditions in over a century and electricity usage hit a record high of 162.7 billion kilowatt hours as farmers increased irrigation. Coal’s share of power output rose to 66.7% while hydropower fell to 14.8%, highlighting coal’s importance in ensuring reliable supply. Despite higher domestic coal production, imports have declined which has helped suppress global thermal coal prices. Peak demand reached a record 243.9 gigawatts on August 31st, exceeding capacity by 7.3 gigawatts and causing the highest power shortage since April 2022.

Renewable capacity additions will need to rapidly scale up for India to achieve its 2030 target of 500 gigawatts of non-fossil capacity.