Budget 2018: Large Hydro Projects May Get Infra Benefits

Tepid PLF growth and stressed financials to result in halving of investments in the convectional power generation; renewables, T&D to be the drivers hereon

CRISIL Research expects power generation volume to grow a moderate ~5% in the current fiscal, given a tepid growth in demand in the first two quarters.

Despite the modest growth in generation, plant load factors (PLFs) of coal-based power plants are estimated to grow just 100 bps to ~60% this fiscal following strong capacity addition of ~23GW and 24GW in fiscals 2016 and 2017, respectively, and weak offtake from discoms. As things stand, 18GW of capacities do not have long-term purchase agreements (PPAs), and another 3 GW have no offtake. Read More…

Budget 2018, Hydro projects