India may need to expand its coal-fired power plant capacity significantly more than previously planned. This was stated by Ghanshyam Prasad, chairman of the state-run Central Electricity Authority (CEA), in New Delhi in October 2026. By 2035, an additional 105 to 150 gigawatts of capacity could be required—a figure that exceeds the 97 gigawatts originally envisioned. This shift is driven by a sharp rise in electricity demand, weak hydropower generation, and a lack of storage capacity for renewable energy. At the same time, coal stocks at existing power plants are dwindling, and significant supply shortages are already emerging.
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Coal-fired power plants to fill supply gaps
India currently has approximately 230 gigawatts of installed coal-fired power generation capacity. Previous expansion plans accounted for an additional 97 gigawatts by 2035. However, the Central Electricity Authority (CEA) suggests that this increase may not be sufficient. Under a high-end scenario, the additional capacity required would exceed current plans by 53 gigawatts. It should be noted, however, that this is currently a demand forecast rather than a set of approved new construction projects.
This reassessment marks a significant shift in India’s energy policy. As recently as 2018, the national electricity generation plan assumed that no further coal-fired power plants—beyond those already slated for development—would be necessary. Since then, however, trends in electricity consumption have rendered that assumption obsolete. In particular, meeting demand during evening hours requires additional, reliable power generation capacity.
Electricity Shortage Reaches Three-Year High
In September 2026, India was unable to meet approximately 560 million kilowatt-hours of its electricity demand—the largest supply deficit seen since August 2023. During the same period, electricity generation from coal rose by 13.3 percent compared to the same month the previous year. Conversely, hydropower production fell by about 20 percent, forcing conventional power plants to supply a greater share of energy.
Between April and August, Indian coal-fired power plants generated approximately 580 billion kilowatt-hours of electricity—an increase of nearly ten percent over the same period the previous year—while hydropower generation dropped by more than eleven percent. According to Prasad, electricity demand at times exceeded the previous year’s levels by 45 to 50 gigawatts. The combination of high consumption and low rainfall significantly exacerbated the supply situation.
Coal Stocks Plunge by 66 Percent
The fuel supply situation became particularly critical. Between the beginning of April and the end of September, coal stocks at Indian power plants shrank from 54.9 million to approximately 18.6 million tonnes—a decline of 66 percent. Consequently, as of October 7, 107 out of the 191 power plants being monitored held only enough stock for five days or less.
India’s Ministry of Coal has since reported a stabilization in supplies; as of October 10, stocks stood at 18.205 million tonnes. Improved rail transport has helped curb further declines, yet many power plants continue to hold only limited reserves. Furthermore, high capacity utilization rates are making it difficult to carry out necessary maintenance work. Prasad warned that operators are finding it increasingly difficult to secure sufficient time windows for scheduled maintenance.
Renewable energy cannot yet bridge supply gaps
At the same time, India is investing heavily in solar and wind energy. According to the Central Electricity Authority (CEA), the annual addition of renewable generation capacity is expected to continue at a rate of approximately 50 gigawatts. However, these facilities do not always provide the required power when needed. Especially after sunset, there is a lack of sufficient storage capacity to deploy previously generated solar power to meet demand.
Furthermore, there are technical challenges related to grid operations. A large number of solar and wind power projects are concentrated in the states of Rajasthan and Gujarat. In these regions, grid disturbances are already triggering automatic shutdowns of generation facilities and transmission lines. Consequently, in addition to building more coal-fired power plants, India is also focusing on nuclear energy and pumped-storage hydropower—technologies intended to complement weather-dependent power generation.
New Coal-Fired Power Plants Require Multi-Billion Investments
The planned expansion highlights a fundamental conflict of objectives in India’s energy policy. On one hand, the installed capacity of renewable energy is growing rapidly. On the other, the country continues to require power plants capable of generating electricity regardless of weather conditions. However, additional coal capacity would necessitate substantial investment and increase long-term fuel demand.
The current strained supply situation is already driving up costs. During evening peak-demand periods, power suppliers are sometimes forced to procure electricity at short notice—often at a high price. According to the Financial Express, such procurement costs have reached as much as 20 rupees per kilowatt-hour. This could lead to higher costs, particularly for energy-intensive industrial operations. Consequently, the key to success lies not merely in expanding generation capacity, but also in ensuring a reliable supply of fuel, the development of storage solutions, and the maintenance of robust power grids.
Author: Blackout News
Sources: The Indian Express (15.10.26) – Reuters (13.10.26) – Financial Express (09.10.26)