India's Power Demand Surges Amid Climate Shifts: Bernstein Report

According to a recent report by Bernstein, India's power demand is set for a robust surge in the second half of the year. Favorable weather conditions, coupled with structural demand drivers, are expected to boost the sector significantly. This is a reversal from previous forecasts and indicates a renewed long-term growth confidence.

The report identifies three major tailwinds contributing to this optimistic outlook: a low-base near-term demand growth bolstered by favorable weather, augmented long-term visibility due to data centers, and a defensive stance against global uncertainties. Significantly, Bernstein had earlier predicted a power demand retraction for calendar year 2026, estimating a 5 percent growth after a static calendar year 2025. However, recent climate patterns suggest the onset of hotter conditions, potentially increasing demand.

The transition from La Nina to El Nino, noted for higher temperatures and lower rainfall, is expected to occur sooner than initially predicted. This shift might cause temperatures to rise and rainfall to drop compared to historical data, beginning from May. Notably, India saw a 1 percent growth in power demand in February 2026, with March expected to follow suit. The report has revised power demand growth expectations for FY27 upward, aligning it with GDP growth numbers, highlighting trends towards electrification and anticipated data center needs.