About the Power Generation and Distribution Sector
The power sector in India is one of the most diversified in the world. The sources of power generation range from traditional sources like coal, natural gas, lignite, hydro, oil and nuclear power to feasible non-conventional sources like solar, wind, and domestic and agricultural waste. The power demand in the country is increasing hugely and is anticipated to increase more in the future.
As of 2021, India was ranked fourth in solar power capacity, wind power capacity and renewable power installed capacity. As of July 31, 2023, India, with an installed power capacity of 423.35 GW, is the third-largest producer and consumer of electricity globally.
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Future Outlook of the Power Generation and Distribution Sector in India
The increase in population, electrification and per-capita usage will raise power usage in India. In the Union Budget 2023-24, the government of India allocated $885 million for the solar power sector, which includes off-grid, grid, and PM-KUSUM projects. To meet the country’s 500 GW renewable energy target and tackle the annual issue of coal demand-supply mismatch, the Ministry of Power has identified 81 thermal units. This will replace coal with renewable energy generation by 2026.
Things To Consider Before Investing in the Power Generation and Distribution Sector
- Global market trends: Monitor global economic trends and energy market dynamics. Understand how factors like economic growth, energy efficiency, and global energy transition initiatives may impact the power sector.
- Environmental impact: Assess the environmental impact of power generation methods of both conventional and non-conventional methods. Increasing focus on sustainability and environmental regulations can influence the long-term viability of power projects.
- Market demand: Analyse current and future demand for electricity, regional supply dynamics, and potential growth areas. Understand the balance between conventional and renewable energy sources.
- Regulatory compliance: Assess the regulatory landscape, policies, and government initiatives influencing the power sector. Stay informed about tariff structures, subsidies, and regulatory changes.
How To Invest in Power Stocks?
Investing in power stocks via Angel One is easy. Simply follow these steps:
- Log in to your Angel One account.
- Click on the search icon and look for your desired power stock.
- Now, place your buy order. Simply click on the ‘Buy’ button, enter your desired quantity, and select the order type.
- To complete your transaction, click on the ‘Buy’ button.
If you don’t have a Demat account with Angel One, you can open one for free online within minutes.
