El Niño to Impact India's Power Generation and Demand Until June 2027
El Niño to Impact India's Power Generation and Demand Until June 2027
IN · Published Nov 13, 2026
• India is expected to face significant challenges in power generation and demand due to the ongoing El Niño phenomenon, which is characterised by warmer sea-surface temperatures. According to the Institute for Energy Economics and Financial Analysis (IEEFA), El Niño has led to reduced wind speeds and below-normal rainfall, adversely affecting wind and hydropower generation. Hydropower output, including imports from Bhutan, dropped by 14.4% year-on-year in Q3
• Additionally, the demand for air conditioning has surged due to higher temperatures, potentially increasing electricity demand by 10 terawatt-hours (TWh) within a year. This combination of reduced renewable energy output and increased demand could result in a generation gap of nearly 18 TWh by June 2027, necessitating greater reliance on coal-fired power plants.

Impact & Risks

The reduced availability of renewable energy and increased electricity demand pose significant challenges for India's power sector. The shortfall in renewable energy generation, coupled with a 10-11% year-on-year growth in power demand projected by Crisil Intelligence for FY27, could lead to a heavier reliance on coal-based power plants. This shift may have environmental implications, including increased carbon emissions. Additionally, the record-breaking power demand in October 2026, driven by unusually high temperatures, highlights the strain on the power grid and the potential for supply disruptions.

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