Electricity supply falls for 5th straight month to 1.1% amid slowdown


India’s electricity supply fell for the fifth straight month in December, provisional government data showed, potentially reflecting sluggish industrial activity amid an overall economic slowdown.

Power supply fell to 101.92 billion units in December, down 1.1% from 103.04 billion units last year, an analysis of daily load despatch data from state-run Power System Operation Corp Ltd (POSOCO) showed.

India’s Central Electricity Authority (CEA), an arm of the federal power ministry, is expected to release official data on power demand later this month. POSOCO releases provisional load despatch data every day.

Lower electricity supply could mean a fifth consecutive fall in power demand, as electricity deficit in India is marginal.

Electricity supply fell 4.2% in November and 12.8% in October, according to the CEA. The October decline in electricity demand and supply was the fastest in at least 12 years.

Electricity demand is seen by economists as an important indicator of industrial output and a deceleration could point to a further slowdown.

Annual consumption of electricity by industry accounts for more than two-fifths of India’s annual electricity consumption, according to government data, with residences accounting for nearly a quarter and commercial establishments for another 8.5%.

India’s overall economic growth slowed to 4.5% in the July-September quarter, government data in November showed, the weakest pace since 2013 as consumer demand and private investment weakened.

Slower economic activity has resulted in a fall in sales of everything from cars to cookies, prompting some large scale industries such as the automobile sector to slash jobs.