Heat in India boosts gas-fired power generation

Heat waves in India are boosting demand for gas-fired power generation, potentially increasing LNG imports in a context of stable prices.

Share:

chaleur inde gaz

The summer season in India is marked by temperatures that regularly climb above 40 degrees Celsius, leading to an exponential increase in demand for electricity, mainly for air conditioning and refrigeration. This year, with maximum temperatures well above average, peak energy demand has already reached 214 gigawatts (GW) in May, and is expected to surpass 250 GW in the coming months. Faced with this rise, the Indian government has increased output from gas-fired power plants, a fast and flexible energy source, to fill the temporary gap created by the limits of renewable energy production and the occasional failure of coal-fired power plants.

The Role of Natural Gas in Energy Stability

Natural gas, particularly in liquefied form (LNG), plays a crucial role in managing energy demand in India during peak periods. With the rapid start-up capability of gas-fired power plants, they are the perfect buffer for unexpected or seasonal peaks in demand. To date, gas-fired power generation has risen sharply to 150 GWh/day to meet increased demand. This increase was supported by strategic LNG imports, facilitated by relatively low world market prices, enabling India to secure sufficient volumes without significantly disrupting the overall energy cost structure.

Economic Implications and LNG Import Strategies

With gas-fired power plants operating at full capacity, India is at a strategic crossroads for LNG imports. Current prices, as assessed by the Platts West India Marker and the JKM for Northeast Asia, are crucial in deciding future buying strategies. Energy companies and importers keep a close eye on these indices to optimize their purchases. Indeed, GAIL and other major importers adjust their contracts and tenders in line with price fluctuations to guarantee a stable, cost-effective energy supply.

Future Challenges and Perspectives

Increasing dependence on LNG, however, poses challenges in terms of sustainability and long-term energy security. As India continues to develop its renewable energy capacity, the integration of gas into the energy mix needs to be carefully managed to avoid over-dependence on an imported energy source. In addition, with the increase in extreme weather conditions due to climate change, India’s future energy planning needs to consider solutions that are more sustainable and less susceptible to the volatility of the global fossil fuel market.
The current heatwave in India highlights not only the immediate challenges of managing energy demand, but also broader issues of energy security and sustainability. As the country navigates through these challenges, the flexibility offered by LNG and gas-fired power plants is indispensable. However, for a stable and sustainable energy future, India needs to balance its energy sources and accelerate the integration of renewables into its national grid.

Turkey has connected its gas grid to Syria’s and plans to begin supplying gas for power generation in the coming weeks, according to Turkish Energy Minister Alparslan Bayraktar.
Despite record electricity demand, China sees no significant increase in LNG purchases due to high prices and available alternative supplies.
US natural gas production and consumption are expected to reach record highs in 2025, before slightly declining the following year, according to the latest forecasts from the US Energy Information Administration.
Naftogaz announces the launch of a natural gas well with a daily output of 383,000 cubic meters, amid a sharp decline in Ukrainian production following several military strikes on its strategic facilities.
Sonatrach and ENI have signed a $1.35 billion production-sharing agreement aiming to extract 415 million barrels of hydrocarbons in Algeria's Berkine basin, strengthening energy ties between Algiers and Rome.
Maple Creek Energy is soliciting proposals for its advanced 1,300 MW gas project in MISO Zone 6, targeting long-term contracts and strategic co-location partnerships with accelerated connection to the regional power grid.
VMOS signs a USD 2 billion loan to finance the construction of the Vaca Muerta South pipeline, aiming to boost Argentina's energy production while reducing costly natural gas imports.
According to a Wood Mackenzie report, Argentina could achieve daily gas production of 180 million cubic metres per day by 2040, aiming to become a key regional supplier and a significant exporter of liquefied natural gas.
Côte d'Ivoire and the Italian group Eni assess progress on the Baleine energy project, whose third phase plans a daily production of 150,000 barrels of oil and 200 million cubic feet of gas for the Ivorian domestic market.
The extreme heatwave in China has led to a dramatic rise in electricity consumption, while Asia records a significant drop in liquefied natural gas imports amid a tight global energy context.
E.ON, together with MM Neuss, commissions Europe’s first fully automated cogeneration plant, capable of achieving a 91 % fuel-use rate and cutting CO₂ emissions by 22 000 t a year.
Facing the lowest temperatures recorded in 30 years, the Argentine government announces reductions in natural gas supply to industries to meet the exceptional rise in residential energy demand across the country.
Solar power generation increased sharply in the United States in June, significantly reducing natural gas consumption in the power sector, despite relatively stable overall electricity demand.
Golden Pass LNG, jointly owned by Exxon Mobil and QatarEnergy, has asked US authorities for permission to re-export liquefied natural gas starting October 1, anticipating the imminent launch of its operations in Texas.
Delfin Midstream reserves gas turbine manufacturing capacity with Siemens Energy and initiates an early works programme with Samsung Heavy Industries, ahead of its anticipated final investment decision in the autumn.
Norwegian group DNO ASA signs gas offtake contract with ENGIE and secures USD 500 million financing from a major US bank to guarantee future revenues from its Norwegian gas production.
Golar LNG Limited has completed a private placement of $575mn in convertible bonds due in 2030, using part of the proceeds to repurchase and cancel 2.5 million of its own common shares, thus reducing its share capital.
Shell Canada Energy announces shipment of the first liquefied natural gas cargo from its LNG Canada complex, located in Kitimat, British Columbia, primarily targeting fast-growing Asian economic and energy markets.
The Australian government is considering the establishment of an east coast gas reservation as part of a sweeping review of market rules to ensure supply, with risks of shortages signalled by 2028.
The increase in oil drilling, deepwater exploration, and chemical advances are expected to raise the global drilling fluids market to $10.7bn by 2032, according to Meticulous Research.