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Thursday, October 21, 2021

Critical coal levels at most thermal plants as demand surges

As many as 104 thermal plants, with capacity of 126.8 GW of the total 135 thermal power plants in the country, are currently classified as having “critical” or “super critical” levels of coals stock for up to a week.

By: ENS Economic Bureau | New Delhi |
October 2, 2021 3:14:38 am
An open cast coal field. (Representational image)

The country’s thermal power plants are struggling with critically low supplies of coal, as power demand has recovered faster than expected. Fifteen thermal power plants, with a generation capacity of 15,385 MW, had zero days of coal stock on hand as of September 30, according to the data released by the Power Ministry.

As many as 104 thermal plants, with capacity of 126.8 GW of the total 135 thermal power plants in the country, are currently classified as having “critical” or “super critical” levels of coals stock for up to a week. A total of 72 plants with a capacity 89.5 GW have coal stocks of three days or less against the government’s guidelines of stocks for 14 days.

Senior officials at the Coal, Power and Railways Ministries are currently working to ensure that thermal plants continue to be able to meet power demand. The government has also redirected coal supplies to thermal plants facing critically low levels of coal stocks.

According to a report by Crisil, thermal power plants have supplied a disproportionately large amount of the sharp uptick in demand. “The massive increase in power demand in April-August was not distributed equally among different sources of power. Coal-based power generation increased (about) 23 per cent on-year, whereas that based on other conventional sources saw (about) 8.4 per cent on-year decline,” the report said, adding power generation from renewable sources had also increased 16.7 per cent during the April-August period.

India’s power demand hit 124 billion units in August, up 17 per cent from the demand of 106 billion units in the corresponding month in 2019 that was not impacted by Covid. International prices for coal have also risen at the same time due to a sharp uptick in demand from China and supply issues. Only a few thermal power stations in India rely on imported coal for power generation, with a vast majority depending on domestic coal for power generation.

The price of Australian non-coking coal used in thermal power plants crossed $200 (about Rs 14,800) per tonne at the end of September. The regulated average price realisation on coal for Coal India, which accounts for about 80 per cent of domestic coal production, is Rs 1,394 per tonne.

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