India power sector sees slowdown ahead

India‘s power project developers and equipment suppliers could be facing a slowdown in orders that could last for at least two years, Bloomberg reports this week.

A shortage of capital coupled with surplus power generation capacity has already led to a drop in investment in new Indian power projects, Bloomberg’s report said, resulting in fewer orders for the sector.

The company’s research indicates that orders for boilers, turbines and generators could fall to 6-8 GW over the coming two years, from their current level of around 10 GW per year.

Rohit Natarajan, an analyst at Mumbai-based IDBI Capital Markets Services, told Bloomberg that “the tepid order inflow is explained by the surplus generation capacity and weaker demand”.

India’s peak power demand in May was half of its 303 GW of installed capacity, with its coal-fired power plants ” the nation’s largest power source ” running at an average of 62 per cent of their capacity. à‚ 

In addition, of the 80 GW of new coal-fired plants planned to be built before 2022, the coal ministry has said that as little as 40 GW could be built.à‚ 

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