Power crunch ahead? Weak monsoon cuts hydro output as India’s electricity demand stays elevated

A weak monsoon is tightening pressure on India’s power system, with hydropower generation set to decline for a fourth straight month as low reservoir and river levels curb supply to the country’s straining grid, Bloomberg reported.

Electricity production from hydro projects fell nearly 12% from a year earlier through 29 August, according to power ministry data. Rainfall last month was more than 16% below the long-period average as a strengthening El Niño brought drier conditions, the India Meteorological Department said.

The monsoon shortfall has kept temperatures elevated and forced farmers to rely more on electricity for irrigation. That has sustained high power demand and contributed to small shortages in the evening, when solar generation fades. Earlier this year, the government had to extend an emergency rule to keep a large coal-fired power plant operating through the rainy season to bridge the shortfall in hydro.

India’s driest June in 12 years triggered a 21% plunge in hydropower generation, the steepest decline since February 2024. Rainfall recovered in July before weakening again in August. The June-to-September rainy season is forecast to bring below-normal precipitation in its final month, worsening the outlook after a 14% deficit so far depleted soil moisture and reservoir levels.

This year’s hydropower decline also reflects a high base after heavy rainfall boosted generation from dams in 2025. New Delhi sees hydro as crucial to expanding its non-fossil power fleet, but dependence on weather, along with the environmental and social challenges of building dams, has slowed growth.

Hydropower accounts for nearly 11% of the country’s total generation capacity. India’s hydroelectric capacity has expanded by about a fifth over the past decade, the slowest among major clean energy sources, including renewables and nuclear. Much of the country’s 52 gigawatts is run-of-the-river capacity, which relies on natural river flows rather than large reservoirs. Himalayan projects benefit from snowmelt in summer, while basins elsewhere depend more heavily on precipitation.

With rainfall weakening again after a brief recovery in July, India’s hydropower output remains under pressure, leaving the grid to manage lower hydro supply alongside strong electricity demand.