Even as India rapidly expands its renewable energy capacity, the operational limitations of coal-fired power plants is emerging as a critical bottleneck in creating more headroom for clean energy in the national grid.
With the addition of over 44 GW of renewable energy in 2025, India’s total installed renewable energy (RE) capacity has reached 262 GW, accounting for more than 51% of the country’s overall installed power capacity.
But integrating this growing green energy into a grid is proving difficult. Addressing the issue, Ghanshyam Prasad, Chairperson of the Central Electricity Authority (CEA), said an incentive scheme is now being proposed to encourage thermal power plants to adopt greater operational flexibility.
However, industry insiders remain unconvinced. They say running plants at lower loads can cause damage to boilers and turbines, increase wear and tear, and shorten the life of the units — risks that, in their view, financial incentives alone cannot fully address. This is true especially for the older thermal power plants in the country.
Coal inflexibility leads RE curtailment
Coal plants are expected to reduce output during peak solar hours — when generation from solar projects surges — and ramp up quickly after sunset when renewable supply dips. However, many of India’s coal-fired stations lack this operational flexibility.
As a result, renewable energy is increasingly being curtailed during peak solar hours.
A recent report by energy think tank Ember estimated that India lost 2.3 terawatt-hours (TWh) of solar generation between May and December 2025 due to curtailment. That is enough electricity to power nearly 14 lakh households for a year.
The financial impact is also significant. The curtailment resulted in an estimated compensation payout of Rs 5.75 billion to Rs 6.9 billion to RE generators, the Ember report said. Notably, renewable energy generators are compensated when curtailed during emergency conditions.
Separately, a latest CEA report also highlighted the issue of heavy curtailment of renewable energy during peak solar hours during May- November last year as rising green power generation collided with the operational limits of coal-fired plants.
The curtailment was largely necessitated because a significant portion of India’s coal-based thermal fleet is unable to operate below 55% minimum technical load (MTL), the report said. MTL is the lowest stable generation level at which a thermal unit can safely operate without shutting down.
On Thursday, CEA Chairperson Ghanshyam Prasad also said thermal power plants are often reluctant to reduce their MTL from 55% to 40% over efficiency concerns.
Grid safety concerns
India operates a unified national grid connecting generators, distribution utilities, and bulk consumers. Any demand-supply imbalance affects system frequency. The permissible band of system frequency is 49.900 Hz – 50.050 Hz.
However, the latest CEA report said that in May last year, system frequency remained above the Indian Electricity Grid Code (IEGC) operating band for nearly 20% of the time. Sustained high-frequency conditions persisted for almost four hours during solar generation hours, reflecting the strain of surplus supply.
“On May 25, 2025, despite backing down the national thermal fleet to approximately 58% and curtailing nearly 10 GW of solar generation through TRAS emergency down dispatch, system frequency still rose to 50.48 Hz, posing a serious concern for safe and secure grid operation,” the CEA report noted, citing GRID-India.
Because thermal power plants were unable to operate at lower loads, curtailment of renewable energy became necessary to maintain grid safety and stability, the report said. The peak curtailment occurred during high solar generation hours and was primarily attributed to several thermal power stations — especially intra-state plants — being unable to operate flexibly at 55% MTL.
Industry pushback
While the CEA stresses the technical feasibility of low-load operations, industry leaders remain skeptical.
An industry insider said generators are unwilling to risk operating below 55% load because of significant thermal and mechanical stress on the equipment such as turbines.
“Because of that wear and tear, the residual life of the asset is getting impacted. So nobody — be it central sector or state sector — wants to operate at low load risking their assets,” the insider said.
In May last year, India’s largest power producer, NTPC, also raised concerns about two-shift operations and flexing down to 40% load, citing adverse effects on unit health.
NTPC had told the Ministry of power that operating units below 55% load is technically not feasible, particularly due to issues such as poor coal quality.
It said repeated ramp-ups and ramp-downs are accelerating wear and reducing the lifespan of thermal units and they are not in a position to support two-shift operation.
Price of inflexibility
The implications go beyond operational challenges. Apart from complicating India’s target of achieving 500 GW of non-fossil fuel capacity by 2030, it also directly impacts consumers.
Under the Detailed Procedure for Tertiary Reserve Ancillary Services (TRAS), renewable energy generators are compensated when curtailed during emergency conditions. They receive compensation at the energy charge rate adopted under the Electricity Act. This compensation is socialised across the power system and indirectly passed on to consumers through electricity tariffs. In effect, consumers pay for electricity that was generated but not used.
At the same time, the grid loses access to clean power that could have displaced fossil-fuel generation, reduced emissions, and improved economic efficiency. The curtailment also means lost opportunities for avoiding carbon dioxide emissions.
With the addition of over 44 GW of renewable energy in 2025, India’s total installed renewable energy (RE) capacity has reached 262 GW. (File) 
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