Trends in National Average Power Purchase Cost by Discoms in India
As India continues to develop and modernize its energy sector, the cost of power purchase is an important metric to monitor. The Rocky Mountain Institute’s report on India’s electricity market provides insight into the trends in the national average power purchase cost over the past few years.
The report shows that the national average power purchase cost in India has been steadily increasing over the past five years, with a CAGR of 4.6%. This increase is attributed to several factors, including rising fuel costs, aging infrastructure, and an increase in renewable energy generation.
| Year | National Average Power Purchase Cost (INR/kWh) |
|---|---|
| 2016 | 3.42 |
| 2017 | 3.52 |
| 2018 | 3.60 |
| 2019 | 3.78 |
| 2020 | 3.85 |
The table above summarizes the findings of the report, showing the national average power purchase cost for each year from 2016 to 2020. As we can see, the cost has increased by almost half a rupee per kilowatt-hour over this period, which is a significant increase.
One of the main reasons for the increase in power purchase cost is the rise in fuel costs, particularly for coal and gas. India relies heavily on these fuels for power generation, and their prices have been increasing over the past few years. In addition, aging infrastructure and transmission losses have also contributed to the rise in power purchase cost.
However, the report also notes that the increase in renewable energy generation is helping to mitigate some of these costs. As the cost of renewable energy continues to decrease, it is becoming more competitive with traditional power generation sources. This is driving down the overall cost of power generation and helping to offset the rise in fuel costs.
Overall, the trends in national average power purchase cost in India reflect the challenges and opportunities facing the country’s energy sector. While there are significant challenges to overcome, there are also promising developments in renewable energy generation that offer hope for a more sustainable and affordable energy future.
