Indian states ramp up coal power deals amid rising demand

India’s state power distributors are signing long-term contracts for coal-fired electricity to meet surging evening demand, even as the country pushes to expand renewables. Uttar Pradesh and Assam plan to secure about 7 gigawatts (GW) of coal power by 2030, adding to more than 17 GW contracted since last year—the largest pipeline since the pandemic—driven by rising air-conditioning use and slow progress in battery storage. The coal push is expected to delay India’s decarbonisation goals, with analysts warning that the country could stay reliant on fossil fuels well into the 2040s. India aims to expand coal capacity from 210 GW to 307 GW by 2035, while targeting 500 GW of non-fossil capacity by 2030. Officials cite grid instability and renewable delays as key reasons for the renewed focus on coal, though experts say renewables with storage are already more cost-effective. India has auctioned 12.8 gigawatt-hours of battery storage, but only 219 megawatt-hours are operational. “New coal power is getting more expensive, and the gap will only widen as batteries scale up,” said energy expert Alexander Hogveen Rutter.