Grid Stability in August 2025 – Who Really Paid the Price?

• Published
• By Anupam Nath

The month of August 2025 was yet another reminder of how complex, fragile, and expensive grid stability can be in a country like India. Energy demand continues to rise, renewable energy capacity is scaling rapidly, and yet, the backbone of the power sector remains tied to conventional fuels. The numbers from August tell a fascinating, and equally concerning, story.

At the very foundation of the grid was coal. Coal-fired power plants continued to deliver the bulk of the electricity, forming the base load that India still heavily relies on. Despite strong growth in renewable energy capacity, coal continues to provide not only the majority of kilowatt-hours but also critical support functions like Automatic Generation Control (AGC) and reserves for balancing. Without coal, the grid would not have survived the demand fluctuations of August.

On top of this, gas-based power plants stepped in as unexpected heroes. Gas supplied around 350 GWh of electricity to support the grid, particularly during peak hours and under system stress. This supply was not cheap—it came at an expense of nearly 4.8 billion INR. Gas, though expensive, offered flexibility when other options were unavailable. It contributed significantly to system security and Transmission Reserve Ancillary Services (TRAS UP).

Meanwhile, renewable energy, often hailed as the future of India’s power sector, ironically played its role by not supplying. Approximately 200 GWh of renewable energy—mostly solar and wind—was curtailed. Grid conditions and operational constraints made it impossible to absorb all the green power available. In this case, renewable energy contributed to grid stability by backing off when the system could not handle it.

Hydropower and nuclear energy also made smaller but meaningful contributions. Hydropower offered quick balancing support, while nuclear provided steady, reliable baseload. Together, they added resilience to the grid, though their roles were limited compared to coal and gas.

Experts caution that if August looked heavy, September 2025 will be even more intense. With rising demand, fluctuating renewable supply, and limited flexible resources, the grid will have to lean even more on costly backup systems. Numbers are expected to rise sharply, and with them, the financial burden.

And this is where the heart of the issue lies: Who pays the price?

The answer is simple—consumers. In a regulated sector like electricity, the costs of planning, investment, and operational inefficiencies are always, directly or indirectly, passed on to the final consumer. Sometimes it shows up as higher tariffs, sometimes as taxes or subsidies funded through the exchequer. Either way, it is households, businesses, and industries who ultimately bear the financial weight of keeping the lights on.

It would be unfair to criticize Grid India. They are doing the best they can under extremely limited options. From balancing multiple energy sources, managing reserves, and ensuring round-the-clock stability, their role deserves appreciation. Still, the reality is stark—the system is expensive, and as demand grows, the cost of inefficiencies will keep rising.

August 2025 was not just a month of numbers—it was a mirror to the challenges of India’s energy future. Coal remains the backbone, gas is the costly savior, renewables are constrained by curtailment, and consumers remain the silent fina

nciers of it all.