Utilities Report : Generation sees sharp revival
Power generation rebounded in December 2025, up ~6.4% YoY to 151BU after a weak October and flat November, driven by the cold wave–led heating demand in North India. Growth was supported by coal (+4% YoY), hydro (+13% YoY), and strong renewables generation (+19% YoY), with thermal plant load factor (PLF) improving to 66%. Peak demand increased 8% YoY to 241.2GW, nearing record levels. Power exchange volume was mixed, with IEX volume up 2.8% YoY, led by strong real time market (RTM) growth, partly offset by a decline in day ahead market (DAM) volume
Power generation increases ~6.4% YoY in December to 151BU: After muted performance during October and November, power generation rebounded sharply in December, up ~6.4% YoY to 151BU. Generation had declined ~5.9% YoY to 142BU in October and was lower by ~0.9% YoY at 134BU in November, making December the strongest growth month in FY26YTD. Recovery was driven by severe cold wave conditions across North India, which led to higher use of heating appliances. Coal-based generation grew 4% YoY to 112BU, and hydro output increased 13% YoY to 9.3 BU, while renewables generation surged 19% YoY to 21BU. PLF for thermal plants increased to 66.0% vs ~63.6% in the past year. Generation has increased ~0.2% YoY to 1,390.8BU for FY26 YTD.
Peak demand rises 8% YoY in December: Peak demand rose 8% YoY to 241.2GW in December 2025, approaching the recent record of 242.7GW during the Summer months. In contrast, peak demand declined 4% YoY to 210.7GW in October and then increased 4% YoY to 215.5GW in November. While the Central Electricity Authority (CEA) had projected peak demand to reach a record 270GW in FY26, actual demand undershot expectations due to the early onset of the Monsoon, which curtailed cooling requirements. Peak power demand had touched an all-time high of 250GW in May 2024, surpassing the previous record of ~243.3GW in September 2023.
Volume moderates on exchanges in December: IEX achieved monthly electricity trade volume of ~11.4BU in December, up 2.8% YoY. A total of 0.77mn of Renewable Energy Certificates (REC) were traded during the month. The DAM segment achieved 5,899MU volume in December declining 11.6% YoY. RTM volume increased to 3,833MU in December, up 20.5% YoY.
Regulated firms, renewables and hydro attractive: We prefer regulated PSU companies, such as NTPC and PGCIL, due to assured returns from regulated assets and robust capacity addition pipeline. CESC offers potential upside, driven by its significant renewable capacity expansion targets while NLC India appears attractive with plans to double its regulated equity by FY30. In the long term, the hydro sector looks promising, due to upcoming capacity addition and renewed focus on the industry
Renewables tenders of ~7.1GW floated in December More than 7,121MW of RE tenders were issued in December under the project development category. SJVN has floated a tender to set up 2,000MW of energy storage capacity from pumped storage projects (PSP) across India. More than 368MW of EPC tenders were issued in December 2025. The NREDCAP has issued a tender for EPC contractors to develop ~233.3MW of grid-connected rooftop solar systems under the PM Surya Ghar: Muft Bijli Yojana. In December 2025, about 250MW of RE capacity was allocated to RE developers under the project development category. GUVNL’s 250MW Wind auction was awarded in December 2025, with Patel Infrastructure (100MW), Alfanar Power (50MW), KP Energy (50MW) and Powerica (50MW) emerging as winners. Discovered tariff is in the range of INR 3.43-3.44/unit. Around 1,400MW of EPC solar capacity was allocated this month. The largest award was NTPC REL’s 1,400MW utility-scale solar EPC tender, with key allocations going to Vikran Engineering (400MW), Sterling & Wilson Renewables (400MW), Bondada Engineering (300MW) and Kintech Synergy (300MW).
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