This year so far has seen both solar and coal power generation rise to ensure grid stability. In 2026, solar power generation increased 39% compared with the last year and coal generation also increased 8%, highlighting that existing thermal assets are crucial for maintaining system reliability, says Nikit Abhyankar, Faculty, University of California, Berkeley.
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With his research work spanning renewable energy grid integration, battery storage and energy efficiency, Abhyankar’s team has collated an extensive database of daily electricity generation across India - coal, gas, solar, wind, hydro, nuclear, and bioenergy - covering 2024, 2025, and 2026 (through October 18), along with plant-level generation costs and electricity market prices.
Hydropower impact
The outcomes clearly reflect the El Niño effect. During June-October, typically when hydropower generation peaks, it fell by 16% in 2026, with the entire shortfall made up by thermal generation.
“Capacity scarcity in 2026 is visible in the split between market prices and generation costs. Demand increases in 2026 are clearly visible in higher thermal generation in September/October and consistent market-price peaks during non-solar hours. In September, non-solar-hour electricity market prices surged 71% year-on-year, while the generation-weighted thermal variable-cost proxy increased just 4.4%,” he says.
India’s southwest monsoon ended on October 15 with a 15% rainfall deficit, with key hydropower-capacity states of Maharashtra, Gujarat, and Rajasthan showing large rainfall deficits.
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The assessment shows a flat line when it comes to total national power generation across the year. “Hydro and wind generation show enormous seasonal variations, with much of their output concentrated during the monsoon. The day-to-day variability in certain wind plants is very high - but together as a fleet is remarkably smooth within the monsoon,” Abhyankar further explains.
Coal stocks
Coal stocks at thermal plants have been critically low, with record coal being loaded to fuel coal-based power generation. Indian Railways has achieved a record in coal loading, registering over 22% growth in October so far this year as compared to the corresponding period last year.
The Ministry of Railways said that coal loading during this period increased by 87 rakes per day as compared to October last year, reflecting the continued efforts to ensure reliable coal supplies to thermal power plants across the country.
During the first half of Financial Year 2026-27, Indian Railways dispatched an average of 430 coal rakes per day to thermal power plants, registering a 7.1% increase over the corresponding period last year.
The sustained pace of coal transportation comes amid rising energy consumption and increased demand for coal-based power generation due to higher industrial production and deficient rainfall in some parts of the country.
Power demand
The electricity demand was also driven by the residential sector, accounting for approximately 25% of total electricity usage in the country, with an annual growth rate of 6% as of 2024-25. Residential electricity consumption, led by high cooling needs, rose from 256 TWh to 409 TWh over the last decade, making it the second-highest consumer after the industrial sector.
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A recent report, ‘Residential Energy Consumption Patterns and Appliance Ownership in India’ by the Bureau of Energy Efficiency (BEE) and CLASP, a global non-profit working on energy-efficient appliances, recommended that with urbanisation and a rise in household incomes, appliance adoption is expected to increase substantially.
“To manage the resulting growth in electricity demand, it is important to enhance energy efficiency standards, particularly by enforcing stricter Minimum Energy Performance Standards (MEPS) for high-impact appliances such as air conditioners, refrigerators, and other cooling devices,” said the report.