Icra revises electricity demand growth forecast downward

Rating agency Icra has revised its forecast for electricity demand growth downward to 1.5-2 per cent for FY26 from 4-4.5 per cent earlier, mainly impacted by the prolonged monsoon. India’s electricity demand fell by 3 per cent year-on-year in the first 10 days of November 2025, the agency said, citing official data.

Ankit Jain, Vice President & Co Group Head - Corporate Ratings, Icra said the early and prolonged monsoon and high base effect have kept demand growth muted throughout FY2026, with overall flat growth for the first seven months. “Reflecting this slowdown, the full-year demand growth forecast has been revised down sharply to 1.5–2 per cent from the earlier 4-4.5 per cent, with expectations of some seasonal recovery during winter,” he said.

 India added 25.7 GW of gross power generation capacity during April-September 2025, more than double the 10.7 GW added in the same period last year. The growth was primarily driven by the renewable energy (RE) segment, supported by developers rushing to commission projects before the expiry of the complete waiver on transmission charges on June 30, 2025.