As disruptions in liquified natural gas (LNG) supplies hit India due to the ongoing conflict in West Asia, the Union Power Ministry is preparing to meet peak summer electricity demand by relying more on coal-based generation.
While coal accounts for over 70% of the country’s electricity generation mix, its operational inflexibility is often cited as a challenge for integrating renewable energy into the grid.
Gas-based power plants, though contributing only a small share to India’s overall electricity supply, are more flexible and can ramp generation up or down to accommodate renewable power while keeping the grid stable during evening peak hours when solar generation is unavailable.
After the government invoked the Essential Commodities Act, 1955 on Monday, gas allocations to power plants and petrochemical units could be curtailed or even halted as supplies are diverted to priority segments such as household and transport.
Officials in the power ministry said the government is ready to tackle any constraints in gas supply and peak demand can be met through other sources.
‘Sufficient alternate resources’
A power ministry official said gas-based power stations account for only about 10 GW of generation at its peak.
“Out of this, approximately 2.4 GW is currently available for generation, while the rest may or may not be available due to constraints in gas supply. In the worst-case scenario, the shortfall due to gas unavailability could be around 7.6 GW,” the official said.
Story continues below this ad
The official maintained that the ministry is prepared for any disruption in LNG supplies and that peak demand can be met through other sources.
“Thermal plants, for instance, can compensate for any shortfall in gas-based electricity generation. We
are fully aware of different scenarios and power supply will not be impacted,” the official told The Indian Express.
In the current financial year, India has added more than 51 GW of capacity, including around 9 GW of coal based power and 4.5 GW of wind power. Another 3 GW coal based capacity is also expected to be commissioned in the coming quarter, a senior official said.
Story continues below this ad
New battery storage capacity of about 2,500 MWh is also expected to come online in the same period, while an additional 2.5 GW of wind power capacity is likely to be added by April 15.
These additions ensure that the government has sufficient alternate resources to manage any potential gas supply disruption, the official added.
Struggling gas plants
Power generated from gas-based units is typically more expensive than coal and renewable energy. However, due to their flexibility, they are generally used during high-demand periods, such as peak summer months when cooling demand surges, to meet evening peak demand.
In the past, the government has invoked emergency measures to ensure utilities operate both gas and coal plants at full capacity when soaring temperatures push electricity consumption to record levels.
Story continues below this ad
Last week, Minister of State for Power Shripad Yesso Naik said peak electricity demand is projected to reach around 270 GW this summer, compared with about 243 GW last year.
Meanwhile, the utilisation of India’s gas-based power plants has been steadily declining, largely due to high fuel costs.
According to a study by the Institute for Energy Economics and Financial Analysis (IEEFA), the share of gas in the country’s electricity generation mix has dropped sharply from 13% in FY2010 to below 2% in FY2025.
The study also found that 31 gas-based power plants with a combined capacity of nearly 8 GW — about 32% of India’s total gas power capacity — did not generate any electricity in 2025.
Story continues below this ad
In April 2025, 5.3 GW of this idle capacity was retired due to inoperability, leaving 20.1 GW of operational gas-fired power capacity in the country.
Out of these 31 plants, 24 are privately owned, meaning 66% of India’s private gas-fired power capacity remained idle in FY2025, effectively turning them into stranded assets.
IEEFA estimated the value of these stranded assets at Rs 650 billion, of which banks had financed about 77%, or roughly Rs 500 billion.
.