In a bid to avert the coal crisis, Coal India steps up supplies to power plants

The expectation within the company is that the production will rise even more after Dusshera, when workers get back from holidays. (Representational image: IE)

With the dark clouds of a likely severe coal shortage which could force thermal power plants to shut down if the coal stocks exhaust has been causing huge concern and at the centre of it all is Coal India, the country’s coal mining and refining behemoth that supplies coal to around 130 out of the 135 coal-powered thermal power stations in the country monitored by the Central Electricity Authority (CEA). Supplies from Coal India are also crucial because 80 per cent of its total off take is for the power sector. Apparently now, in a bid to step up supplies and overcome shortage, Coal India’s supplies to power stations have already touched 1.62 million tonnes a day in the past two days, with total offtake rising to 1.88 million tonnes per day, compared with the month’s average of 1.75 million tonnes. The expectation within the company is that the production will rise even more after Dusshera, when workers get back from holidays.

Related posts

EXCLUSIVE – Crypto giant Binance controlled ‘independent’ US affiliate’s bank accounts

June 5, 2023

Why investing just to save tax may be bad for you

June 5, 2023

The company had, as on Monday, October 11 th , scaled up supplies to power utilities of the country to 1.51 million tonnes (MTs) per day during the previous four days of October ahead of the festival. “The aim is to ramp up supplies to power sector even higher which we hope to achieve post puja. Once the despatch rate is maintained the stock build up will help tide over the tight situation” said S.N. Tiwary, Director Marketing CIL in a note from the company.

Despite heavy rainfall, which disrupted mining activity, CIL is learnt to have produced close to 126 MTs of coal during the second quarter of the current fiscal year, setting a record high for the second quarter, posting 9.6 per cent year-on-year growth. In the first ten days of October, CIL’s output posted a 6.5 per cent growth over last October. Going forward, the production, the note from the company says, will increase further when the attendance at coalfields improves after festival holidays.

It also said that the CIL’s supplies to Gencos have been at an all time high till now this fiscal but it is the never experienced before hunger for the dry fuel, spurred by an unmatched increase in power generation that upset the demand-supply scales.  The expectation is that following the festive season, especially in October, conditions should improve with reduced demand for power, which could ease the pressure.

During H1 of the current fiscal year, loading to power sector at 225.3 rakes per day was up 28 per cent compared to 176.3 rakes of last year same period. The company, the note says, is building up adequate evacuation logistics to transport coal. “The major pain point for CIL has been 14 imported coal-based power plants scaling down their generation due to skyrocketing coal prices in the international markets. As a consequence, domestic coal based thermal power plants had to step in to fill in the generation shortfall, which in turn placed an unfactored load of around 10 MTs on CIL. Had this not happened the stocks at power plants would have been around 17MTs to 18 MTs instead of the bleak 7 MTs now,” the note said.

During September’21 the generation from these plants at 2.041 MW fell short by 75 per cent as against the target of 8.114 MW. The generation posted a negative growth of 72 per cent compared to September 2020 when they generated 7.238 MW. Progressive up to September 2021 the contraction in generation was 30 per cent over same period year ago.

“CIL is marshalling all its efforts to bridge the demand supply gap to the extent possible. With 40 MTs stock at our pitheads and increasing production, availability of coal would not be a problem,” said the note quoting a senior official of the company.