Powering progress

Gujarat’s Energy Sector Boasts A Comprehensive Ecosystem, Encompassing Power Generators, Equipment Manufacturers And Renewable Energy Initiatives, Driving The State’s Energy Self-Sufficiency
Gujarat, with its gleaming skyline and humming factories, is on a relentless journey of urbanization and industrialization. But what’s the fuel propelling this remarkable growth? None other than uninterrupted and affordable power, a non-negotiable cornerstone of progress.
A powerhouse of entrepreneurial spirit and innovation, Gujarat is celebrated worldwide for its dynamic manufacturing sector.At the heart of this bustling hub of industry lies the electric pulse of the state – the power sector.
As of June 4, 2024, Gujarat boasts an installed capacity of generating 53,258.39 megawatts (MW) of power, according to data from the National Power Portal. Of this, the active capacity is 49,261.8MW, including monitored and online capacities, whereas 5,685.02MW is currently under maintenance.
A powerhouse of entrepreneurial spirit and innovation, Gujarat is celebrated worldwide for its dynamic manufacturing sector. At the heart of this bustling hub of industry lies the electric pulse of the state – the power sector. As of June 4, 2024, Gujarat boasts an installed capacity of generating 53,258.39 megawatts (MW) of power, according to data from the National Power Portal. Of this, the active capacity is 49,261.8MW, including monitored and online capacities, whereas 5,685.02MW is currently under maintenance.
“The total power demand in Gujarat was 120 billion units in 2023- 24,” the official said. “Industrial power demand is increasing by 8-10% annually while domestic demand grows by about 5% yearly. Agricultural demand has nearly plateaued, expanding at around 2% due to new connections and higher power use. To keep pace with this rising demand, we are planning to boost our power generation capacity,” the official explained.
Based on these trends, Gujarat’s energy needs are expected to climb by 7.8 billion units by the end of the 2024-25 fiscal year. Gujarat is capit a l i z i n g o n i t s well-established network of power equipment manufacturers and generation and distribution companies to tackle its expanding energy requirements. The state is also making significant progress in the renewable energy sector, positioning itself to meet future demands efficiently and sustainably.
Gujarat’s RE policy sparks investor interest
Despite efforts to boost power generation, Gujarat still buys energy, particularly in summer, purchasing 1,000-1,500MW daily from the India Energy Exchange Limited (IEX). This highlights the need to use existing projects better and create new ones.
Compared to other Indian states, Gujarat, in fact, is taking the lead in adding renewable energy (RE) capacities. This is clear with the world’s largest RE park coming up in the Khavda area of Kutch, which will see 30,000 MW of fresh green power generation capacities.
10GW of renewable energy projects under the Renewable Energy Policy 2023. These include 5GW of solar projects and 5GW of wind and wind-solar hybrid projects, according to the Gujarat Energy Development Agency (GEDA).
The state has introduced policies to attract green energy investments and plans to establish 36GW of solar and 143GW of wind energy capacities soon. Gujarat aims to generate 50% of its power from renewable sources by 2030, reflecting its commitment to sustainable energy.
Gujarat reaps benefits of revamped scheme
Gujarat isn’t just a leader in power generation, it’s also a powerhouse in manufacturing power equipment. The state produces 63% of India’s cables, conductors, transmission towers, and transformers — essential components in the power supply chain. Major manufacturing hubs like Ahmedabad, Vadodara, Rajkot, and Valsad are vital players, producing significant amounts of bushings and insulators.
Recently, Gujarat’s power equipment sector has seen remarkable growth. “The sector was growing at about 7% until three years ago, but the last three years have witnessed a CAGR of around 15%,” said a power sector expert. Several govt initiatives drive this surge. The Rs 23,200 crore robust scheme aims to lay underground cables over five years to mitigate annual cyclone-related losses estimated at Rs 3,000 crore. States like Odisha and Tamil Nadu, along with Gujarat, are benefiting from this scheme, resulting in substantial orders for Gujarat-based companies.
Additionally, the Centre’s revamped distribution sector scheme (RDSS) aims to reduce power loss and strengthen the power distribution network.
This initiative, along with the Smart City project, which replaces overhead cables with underground ones in about 675 cities nationwide, promises sustained high demand for power equipment. Over the next five years, Gujarat’s manufacturers are set to benefit significantly from these initiatives.
Infrastructure boom drives wires and cables market
According to a leading cable manufacturer, the Indian wires and cables market reached nearly Rs 1,083.71 billion in 2023. It’s projected to grow at a CAGR of 14.5%, potentially reaching Rs 3,655.81 billion by 2032.
Industry estimates indicate that India accounts for 15% of the global transmission tower market. By 2025, India is expected to consume 1.8 trillion units of electricity. The CII reports that Indian govt’s vision for a $5 trillion economy will necessitate an estimated Rs 5 trillion investment in the transmission sector over the coming years. The National Infrastructure Pipeline forecasts a capital expenditure of Rs 3,040 billion in the transmission segment from 2020 to 2025. The transmission tower market, valued at over $17 billion in 2021, is expected to grow at a CAGR of 4% from 2022 to 2028, reaching $24 billion by 2028, according to Global Market Insights (GMI).
The expansion of the power and infrastructure sectors has driven the market for cables and conductors. As per the Indian Electrical and Electronics Manufacturers’ Association, during 2022- 23, conductor imports stood at Rs 7.97 billion, much lower than exports, which were Rs 55.04 billion during the same period. From 2023-24 (up to June 2023), conductor imports were Rs 1.91 billion, while exports were Rs 15.11 billion.
Kavish Shah, vice-president of Diamond Power Infrastructure Ltd, said, “India has seen the fastest infrastructure growth in the last decade. Factors include rapid urbanization, smart cities, policy reforms in the power sector, and growing demand for renewable energy. Innovations in AI and new local data centres will further increase energy demand. Power cables are essential for transmitting and distributing electricity from generators (thermal, solar, and wind-solar plants) to substations and end-user segments such as residential, commercial (airports, metro, hospitals), and industrial units.
“This high demand has driven exponential growth in India’s electrical wire and cable industry. Order books are full, and demand will continue to rise in coming quarters.”