Iran war will increase India's reliance on coal for electricity production in the summer

- India is likely to expand its reliance on coal for electricity generation to meet peak energy demand this summer as liquefied natural gas supplies dwindle after shipping disruptions linked to the U.S.-Israel war on Iran affected exports from major producers, two energy officials said.

New Delhi typically urges power plants to increase production during the summer months of April to June, including costly production using gas, to meet rising electricity demand, and also subsidizes costs for companies to protect consumers from price hikes.

An informed official stated that the government has not yet received any bids from electricity companies to supply 12,000 megawatt-hours of gas-fired power for the summer months. The tender will close in two days.

A second official said the Ministry of Electricity is considering excluding coal-fired power plants from planned shutdowns and is advising energy producers to avoid closures during the peak demand summer months.

Two sources at NTPC, one of India's largest utility companies, said the company had already informed the power grid regulator that it would not be able to supply gas-generated electricity during the summer months of April to June.

Neither the company nor the federal electricity ministry has yet responded to Reuters' emails seeking comment.

India implemented emergency measures and declared force majeure, rearranging natural gas supplies to key segments such as homes and fertilizer plants.

India’s Petronet, the country’s largest gas importer, issued a force majeure notice to its customers, including major electricity suppliers such as India’s GAIL, Indian Oil Corporation and Bharat Petroleum, after supplies from Qatar and Abu Dhabi National Oil Company (ADNOC) were halted.