Coal’s diminishing role in India’s electricity transition

The report argues that as India expands solar and wind capacity, coal's role will shift from baseload provider to a flexible balancing resource, leading to lower plant load factors (PLFs) and higher effective costs. By FY 2031-32, coal-based electricity is projected to be roughly 25% costlier than in FY 2024-25. The analysis suggests that the ~35 GW of coal capacity currently under construction is sufficient for reliability, making further coal expansion uneconomical compared to firm and dispatchable renewable energy (FDRE) and storage options.

• India is generally on track to meet its NEP-2032 capacity targets for solar, coal, and hydro, though wind capacity additions must accelerate and nuclear is likely to fall short of its target.
• Coal's operational role is shifting from baseload to flexible balancing, which will significantly reduce its average Plant Load Factor (PLF) from approximately 69% in FY 2024-25 to 55% by FY 2031-32.
• The effective cost of coal-based electricity is projected to rise by roughly 25% by FY 2031-32, driven primarily by underutilisation (spreading fixed costs over fewer units) and increased operational expenses from part-load inefficiencies.
• New coal capacity beyond the ~35 GW already under construction is unnecessary and uneconomical, as approximately 10% of additional units would be entirely unutilised by FY 2031-32.
• Firm and Dispatchable Renewable Energy (FDRE) and solar-plus-storage are now more cost-competitive than new coal plants, with FDRE tariffs between INR 4.3–5.8/kWh and solar-plus-storage at INR 2.9–3.6/kWh, compared to new coal tariffs nearing INR 6/kWh.
• To integrate higher levels of renewables, India should prioritize expanding battery energy storage systems (BESS) and pumped hydro storage (PHS), and consider mandating a statutory minimum technical load (MTL) of 40% for coal plants to increase flexibility.

APA

Rodrigues, N., Das, D., & Ewen, M. (2025). Coal’s diminishing role in India’s electricity transition. Ember. https://ember-energy.org/app/uploads/2025/10/Coals-diminishing-role-in-Indias-electricity-transition.pdf

Chicago

Rodrigues, Neshwin, Duttatreya Das, and Matt Ewen. Coal’s diminishing role in India’s electricity transition. Ember, 2025. https://ember-energy.org/app/uploads/2025/10/Coals-diminishing-role-in-Indias-electricity-transition.pdf.

Wikipedia

{{cite report |last1=Rodrigues |first1=Neshwin |last2=Das |first2=Duttatreya |last3=Ewen |first3=Matt |title=Coal’s diminishing role in India’s electricity transition |publisher=Ember |date=29 October 2025 |url=https://ember-energy.org/app/uploads/2025/10/Coals-diminishing-role-in-Indias-electricity-transition.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rodrigues2025coals, author = {Rodrigues, Neshwin and Das, Duttatreya and Ewen, Matt}, title = {{Coal’s diminishing role in India’s electricity transition}}, institution = {Ember}, year = {2025}, month = oct, url = {https://ember-energy.org/app/uploads/2025/10/Coals-diminishing-role-in-Indias-electricity-transition.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }