Signs of recovery: Power generation decline slows in July

In a sign that the economy is gradually returning to normal after getting severely hit by the Covid-19 pandemic, the rate of decline in electricity generation in the past few months has slowed down in July.

As per data available with grid operator, Power System Operation Corporation Limited (Posoco), electricity generation fell by 1.8 per cent in July as compared to the much sharper fall of 9.9 per cent in the previous month of June. The generation had also fallen sharply in April, when most parts of the country were under lockdown due to the Covid-19 outbreak.

While the pick in power generation and consumption is a good sign of economic revival, the worrisome part is the decline in July has continued at a much faster pace in the latter part of the month. In the first half, the decline in generation was just about 0.6 per cent, but it rapidly increased to 3.1 per cent after July 15.

Also, the slowdown in generation decline has come at the behest of a pick up in power consumption in the large populous states such as Uttar Pradesh, Bihar, Madhya Pradesh, Rajasthan and Jharkhand.

Power consumption however continues to remain slow in the industrial states of Delhi, Maharashtra, Gujarat, Tamil Nadu, Andhra Pradesh and Karnataka, indicating that things are still far from normal and both economic growth and a pick up in power consumption will take more time to materialise..