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Adani Power Recasts Thermal Fleet as Grid Stabiliser Amid Renewable Surge

India’s peak electricity demand seen rising to 380–400 GW by FY32. As India’s electricity system rapidly shifts toward renewable energy, Adani Power is redefining the role of its thermal assets—positioning them as critical grid-balancing units rather than pure baseload generators. The strategy is aimed at supporting large-scale renewable integration while ensuring grid reliability, even as the company moves ahead with a nearly 24 GW thermal capacity expansion through FY32, backed largely by long-term power purchase agreements (PPAs).

“The focus has moved from maximising plant load factors to maintaining high availability so that thermal stations can step in whenever renewable generation fluctuates,” said Dilip Jha, Chief Financial Officer, Adani Power. “Thermal plants are increasingly being used as balancing assets to enable higher renewable penetration while continuing to meet baseload demand.”

Jha noted that newer units are significantly more efficient, delivering 5–10% higher output with lower coal consumption compared to older technologies. He added that the company’s proximity to coal sources for most projects helps reduce transportation costs and improve operational economics.

Adani Power currently operates 18.5 GW of capacity, with nearly 90% contracted under long- and medium-term PPAs with state-owned electricity distribution companies.

The company is in the midst of a 23.7 GW brownfield thermal expansion programme, spread across multiple locations in central and eastern India. Progress updates show Mahan Phase II nearing completion at about 80%, Raipur Phase II at roughly 44%, Raigarh Phase II close to 38%, and construction activity resuming at Korba Phase II, according to the company.

Commissioning of these projects is scheduled to begin from FY27. “Around 2.9 GW is expected to come online next year, followed by 2.4 GW each in FY28 and FY29, nearly 8 GW by FY30, about 5.6 GW by FY31, and another **2.4 GW thereafter,” Jha said. He added that the first unit of the revived Korba Phase II project is targeted for commissioning by mid-next year, with the second unit expected by the end of the year.

On demand trends, Jha said higher hydroelectric generation and strong renewable output during the extended monsoon temporarily reduced the share of thermal power in India’s electricity mix during Q3 FY26. Thermal generation’s contribution declined to 73% from 76%, while the combined share of renewables and large hydro rose to 24% from around 20%.

However, he described this shift as short-term. “This is a transient phase,” Jha said, adding that rising household consumption and expanding industrial activity are expected to push India’s peak power demand to 380–400 GW by FY32, reinforcing the long-term need for flexible and reliable thermal capacity.