Why Keralam is facing a power crisis | Explained

The story so far:After the weekly Cabinet meeting on Wednesday (September 16, 2026), Keralam Chief Minister V.D. Satheesan said his government was in touch with eight States and multiple power sector agencies for securing emergency electricity supplies to tackle an ongoing power crisis. The Chief Minister also announced that the Congress-led United Democratic Front (UDF) government would put in place a revised power policy and short- and long-term plans for guaranteeing State-level energy security. The announcements have come even as Keralam struggles through an unprecedented monsoon-season power crisis.The Kerala State Electricity Board (KSEB) – the State-owned utility which manages electricity generation, transmission and distribution – has imposed power curbs citing shortfall in power availability and soaring consumption during the evening hours.The backdrop of Keralam’s power crisisThe southern State is heavily reliant on electricity ‘imports’ for meeting its growing requirement. A mere 30% of the demand is met through internal generation, which is primarily hydropower. The remaining 70% is met through supplies from the Central Generating Stations (CGS) and power purchases. Traditionally, purchases shoot up during the summer months as dependence on air-conditioners to stave off the soaring summer temperatures drives up electricity use. In recent years, there has been a surge in the State’s solar power capacity courtesy subsidy-attached government schemes. Data with the Ministry of New and Renewable Energy (MNRE) place Keralam’s rooftop solar capacity at 2,259.50 megawatts (MW) as on August 30, 2026.While this is a remarkable achievement, it has not translated into energy security for the State, largely due to the failure to complement this capacity addition with grid-scale energy storage systems. This has resulted in a curious situation: during the daytime, the KSEB has been surrendering electricity out of its CGS and round-the-clock (RTC) contracts to accommodate the solar power injected into the grid by prosumers. In the evening hours, when the demand peaks, the power utility is forced to rely on high-priced electricity procurements to satisfy the demand. The 2026 power crisis reared its head during the summer months in April, forcing the KSEB to announce power curbs on a “limited scale” between 6 p.m. and midnight in unavoidable situations. The summer situation was attributed to the use of air-conditioners to tackle the summer heat, charging of electric vehicles after 6 p.m. and the reliance on electric cooking following the LPG shortage caused by the West Asia crisis.However, the crisis and the curbs have persisted into the monsoon months, which is unprecedented for Keralam. The latest spell of power curbs began with the Grid Controller of India anticipating a deficit of 12,000 MW nationwide on September 2. As per a September 15 update from the KSEB, this issue is yet to be fully resolved. Moreover, the monsoon months are the time when the KSEB is expected to return electricity borrowed from power utilities elsewhere in the country under ‘swap’ arrangements to meet its own summer demand. But, even as early as July – the second month of the ongoing southwest monsoon season – a KSEB panel had warned of the “likelihood of further deterioration in the power scenario due to the anticipated impact of El Niño.” The weak monsoon has left water levels in the reservoirs of hydropower projects low, while the evening electricity demand has soared.Why is the KSEB drawing flak?In a nutshell, the crisis has once again laid bare the weaknesses of Keralam’s power system and its dependence on power procurements from outside the State. The KSEB has drawn sharp criticism from the public for the night-time power curbs. In many places, the outages are unannounced and occur multiple times, it is alleged. Power sector observers blame the KSEB for failing to anticipate and plan for the changing trends and patterns in the power sector. While the State’s solar power capacity has shot up, so has consumption. Mr. Satheesan noted that the power demand in September 2026 has risen by almost 925 MW compared to September 2025. Of the daily consumption of 94.44 million units (mu) on September 14, imports alone accounted for 70.82 mu. The power utility has also failed to put in place grid-scale battery energy storage systems (BESS) or implement pumped storage projects (PSP), which, observers feel, could have averted the crisis. The State Planning Board, in its Economic Review for 2025, had listed renewable energy integration and capacity expansion among the challenges facing the sector. “Growing electricity demand requires increased generation capacity and reliable power supply,” it noted. What the political row is all aboutIn May 2023, the State Electricity Regulatory Commission had rejected power supply agreements (PSA) totalling 465 MW entered into by the KSEB citing procedural violations. The 25-year Design, Build, Finance, Own and Operate (DBFOO) contracts with Jhabua Power, Jindal Power, and Jindal India Thermal Power were signed during the period of the Congress-led United Democratic Front (UDF) government in 2014, but cancelled during the term of the CPI(M)-led Left Democratic Front (LDF) government. Although the LDF government, faced with a power crisis, tried to get the supplies restored, it did not succeed.The UDF, which is now again in power, argues that had these agreements been restored, the present crisis could have been averted and Kerala would have been assured of low-cost power supplies for the long term.The cost of the crisisFor a small State, Keralam’s annual expenditure on power purchases is huge. The KSEB’s annual administration report says it spent ₹12,982.59 crore in 2023-24 and ₹12,749.65 crore in 2024-25 on purchases. This is bad news for the common consumers as additional spending on power procurement ultimately gets passed on to them through thermal fuel surcharges on their electricity bills.What the long-term effects could beWhile the monsoon-season power crisis and the resultant power curbs are proving to be a nightmare for the people, it can impact the State’s prospects in other ways. For instance, on Wednesday (September 16), the Cabinet cleared the ‘Simplified and Accelerated Regulatory Approvals and Licences’ (SARAL Keralam) mechanism for fast-tracking clearances for investment proposals as part of the UDF government’s plans for attracting investment across various sectors.In his Revised Budget for 2026-27 presented in June, Mr. Satheesan had stated that his government was “steadfastly committed to ushering in a ‘New Age Kerala’ (Puthuyuga Keralam) — an era that harmonises economic growth driven by social justice backed by modern, environmentally responsible infrastructure development.”To make all this happen, uninterrupted power supply remains a basic necessity.