The Pulse | Environment | South Asia

India’s Climate Stress and the Solar Power Paradox

Rising demand will keep coal the backbone of India’s power grid in the coming years. This buys time for executing an energy transition, if India can see through its plans. 

In April and May 2026, all of the 50 hottest cities in the world were located in India, an ominous distinction for the country, which is witnessing deep, systemic climate stress. This trend has continued unabated into subsequent months, with high temperatures and humidity levels driving increased use of cooling appliances such as air conditioners across many states in India.

In July 2026, India’s electrical energy consumption grew 10.93 percent year-on-year to 170.70 billion units (BU). In comparison, the country’s total power consumption was 153.88 BU in July 2025. The peak power demand also jumped to 270.20 GW in July 2026. It was 220.74 GW in July 2025. The all-time record high was set in May this year with demand of 270.82 GW. 

The steep rise in temperature and heat waves may be a problem for people, but for the leading air conditioner manufacturers, it is a buoyant market. Companies like Voltas and LG Electronics have reported high sales. Each had already sold over 1 million units in the first three months of the year. Panasonic India said its residential AC sales increased by 50 percent year-on-year in the summer season of 2026, representing its highest-ever level.

These are very high figures for a developing country, where 60 percent of the population depends on food subsidies and power bills are on a constant rise. It also demonstrates the fact that the rising middle class, not just in metros, but also in tier-two towns and beyond, is responding to the threat and discomfort of a warming climate with significant uptake of household cooling options. Access to air conditioning, seen increasingly as a significant health issue globally, also contributes to the global warming and climate crisis. 

According to the International Energy Agency (IEA), global electricity demand is expected to grow by 3.6 percent in 2026 and 3.8 percent in 2027, driven by industry, cooling, electric vehicles (EVs), and data centers. In India, one of the world’s fastest-growing major electricity markets, it is projected to grow at 7 percent,  twice the global average. In comparison, it will grow at 5.5 percent in China, 1.8 percent in the U.S., and 2.1 percent in Europe. 

El Niño, a climate pattern in which surface waters in the central and eastern Pacific Ocean become significantly warmer than average, is projected to turbocharge extreme weather across the planet this year. India is already witnessing a deficient monsoon in 2026, attributable to the El Niño underway. According to the India Meteorological Department (IMD) and government vulnerability assessments, the country’s central, eastern, and northeastern regions face the highest drought risks. Reports have already indicated its possible impact on electricity generation. States like Odisha are considering a halt in hydropower generation to prioritize drinking water and irrigation. The southern states of Karnataka is prioritizing drinking water over irrigation for agriculture. 

However, even with the ongoing war in Iran – which has created enormous hurdles for energy imports for India – the country has managed to generate enough power to meet this rise in demand. While international energy prices have risen during the first half of the year, India’s wholesale electricity spot prices declined by around 10 percent.  This would not have been possible without India’s perennial and increasing reliance on coal, which provides 74 percent of the total power generation. 

There has been a steady growth in solar energy generation as well, under the government’s Solar Parks Scheme. Official data by India’s Ministry of New and Renewable Energy indicated that solar........

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