India's total electricity generation in June rose 10.4 per cent year-on-year to 178.31 billion kilowatt-hours (bn kWh), according to Reuters calculations of daily data from the federal grid regulator Grid-India. Coal-fired power generation rose about 14 per cent year-on-year to 120.20 bn kWh, the highest since November 2023. The rise came as cooling demand climbed amid sustained high temperatures and weak rainfall. Grid operators increased coal dispatches to meet peak evening demand when solar output was insufficient.

Last month was the fifth-driest June since 1901 as a strong El Nino pattern contributed to searing heat and below-average monsoon precipitation, the meteorological office reported. El Nino involves warming of Pacific Ocean waters off South America and tends to bring hot, dry conditions to parts of South and Southeast Asia. The extended heatwave increased demand for air conditioning, particularly in the evening, when solar output is limited by the lack of large-scale battery storage. System operators relied more on coal generation to balance the grid as a result.

Renewable power's share of the mix rose to a record 19 per cent in June, with overall renewable generation at 33.81 bn kWh, up 23 per cent from a year earlier. Despite additions to renewable capacity, the lack of storage constrained use of solar generation during evening peak periods. Hydropower output fell 24.4 per cent to 14 bn kWh, the steepest decline since February 2024, reflecting the weaker monsoon. Natural-gas-based generation also declined, down 30.1 per cent from a year earlier.

Industry observers noted that in 2025 India's coal power generation fell annually for the first time since the COVID-19 lockdowns in 2020, underscoring the recent variation in the sector. Market participants said coal demand has surged in recent months to meet evening air-conditioning needs as battery storage for solar remains limited. ICRA vice president Ankit Jain said thermal generation could increase this fiscal year to meet higher electricity demand in peak consumption periods. Policymakers and grid operators face the challenge of integrating rising renewable capacity while maintaining reliable supply during extreme weather.