Farms to spike diesel, power demand for irrigation as monsoon may falter

The demand for diesel at the government-promoted Kisan Seva Kendras—rural retail outlets that vend fuels and other products and services to farmers—is likely to see higher growth than the other pumps, said fuel retailers.

Punjab, Haryana, Uttar Pradesh and parts of central India are likely to see higher diesel and power demand as farm mechanization and groundwater extraction are high in these regions, said the people in the know. Power utilities may also face elevated daytime electricity demand as farmers then switch on their tube wells to irrigate their paddy, pulses, oilseed and cotton crops for the season, they said.

This year, the situation has been aggravated with the ongoing West Asia war disrupting energy imports and the supply of fuels, including diesel. "For most part of the year, Kisan Seva Kendras sell 40-50 kilolitre (kl) of diesel a month, but during kharif and rabi sowing, this shoots up to 200 kl a month," said Monty Sehgal, spokesperson of the Petrol Pump Dealers Association Punjab, representing 4,000 pumps in the state. “We have written to the Punjab government, seeking their direction to the OMCs (oil marketing companies) to ensure adequate supplies.”

Hemant Sirohi, a petrol pump dealer in Uttar Pradesh and a member of Empowering Petroleum Dealers Foundation, an organization with 3,000 members, said diesel consumption in north-western and central India typically rises 1-4% during kharif sowing, but this year the “demand is expected to increase by 5-10% due to heatwave conditions and a below-normal monsoon."

Many key kharif crops are also water-intensive. “A weaker monsoon is expected to push farmers towards diesel-run pump sets and electricity-powered tube wells for irrigation to maintain sowing activity for water-intensive crops such as paddy, sugarcane and pulses. The trend could particularly intensify in states depending on groundwater irrigation and having relatively weaker canal infrastructure," said Puneet Singh Thind, founder and director of Northern Farmers Mega FPO, a federation of farmer-producer organizations from five North Indian states.

Last month, the India Meteorological Department (IMD) cut the season's rainfall forecast to 90% of the long period average (LPA) from its initial estimate of 92%. Rains are seen normal over the North-East, but below normal in central, south Peninsular and North-West India. The ‘monsoon core zone’ that covers most rainfed agricultural regions is also projected to receive below-normal rains.

This rise in agricultural power requirement is set to coincide with the typical higher summer electricity demand across the country, creating additional stress for state utilities that are already grappling with peak demand pressures.

The nationwide peak power demand has already reached a record high of 270.8GW and is projected to hit 271GW this year, according to the Central Electricity Authority.

Basant Garg, managing director at Punjab State Power Corp. Ltd (PSPCL), said the state's power demand, currently at 11,000-14,000MW, may rise to 18,000 MW during the daytime for kharif sowing. The demand during this period is typically around 16,000MW. He said Punjab is making efforts to shift the irrigation demand to daytime to utilize the solar power potential in the state.

Higher costs of irrigation may squeeze farm profitability. Farmers relying on diesel-powered pumps could face rising operational expenses if irrigation requirements increase substantially. Power and diesel typically have a 25-30% share in total farming costs.

Farmers mostly buy diesel at retail rates, which have been increased by about ₹7.5 per litre since 14 May.

Agriculture and allied activities have around 16% share in India's gross domestic product (GDP). The sector is estimated to have grown 3.1% in FY26. Kharif crops contributed over 47% to India’s total foodgrain output of 376.5 million tonnes in 2025-26.