To meet fuel shortage, CIL ups power sector supplies by 20% in September



Amid depleting coal stocks at thermal power projects, India’s largest miner of the fuel, Coal India Ltd (CIL) has stepped up supplies by 20% in September so far to the crucial sector, the state-run firm said on Friday.

This comes against the backdrop of India stopping coal supplies for a week to plants having more than 15 days’ stock to free about 177,000 tonnes of fossil fuel, to be redistributed to power plants having low stocks. The coal stocks have depleted at thermal power plants due to reasons such as increase in demand for electricity and lower generation by hydropower plants.

“However, CIL has stepped up supplies to power sector in the first eight days of September, clocking about 20% growth at an average of 1.39 MT (million tonnes) per day. Till same date of last September, the average supply per day was 1.16 MT,” CIL said in a statement.

India’s power sector is the largest consumer of coal in the country. Of India’s installed power generation capacity of 383.37 gigawatts (GW), coal-fuelled projects account for 53% or 202.67 GW.

“We are aiming to augment total supply further to a level of 1.8 MT per day consistently and 1.45 MT per day to power sector,” a senior CIL official said in the statement.

CIL has supplied 206 MT of coal during April-August to the power sector, which is 44 MT more than what it supplied in the corresponding period last year.

“CIL’s total supply also logged 1.71 MT per day during the first eight days of the ongoing month compared with 1.49 MT per day last year, achieving a growth of nearly15%,” the statement added.

India’s electricity demand has been growing after dipping last year during the first wave of the pandemic. In a reflection of revival of economic activity in the country, India’s peak electricity demand recorded an all-time high of 200.57 GW on 7 July.

Also, e-auction bookings have been up 42% during April-August period. “Coal India’s e-auction bookings logged a robust 42% growth during April-August 2021, on the back of a demand spike in coal-based power generation and soaring international coal prices, compared with the corresponding period year ago,” the statement said.

Of CIL’s coal production target of 670 MT for the current financial year, the demand from the power sector is expected to account for around 545 MT. India’s overall coal requirement is expected to go up to 1,123 MT by 2023 from the present level of 700 MT.

“CIL booked 53.3 MT of coal in the first five months of FY22, under the five auction categories. This is nearly 16 MT higher compared with 37.5 MT of corresponding period in FY21. The add-on fetched was 30% over notified prices,” the statement said.

India’s electricity demand reached its highest since July 2019 to register124.8 billion units (BUs) in July this year, according to India Ratings and Research.

“With the upsurge in coal-based power generation, the quantity booked by power sector customers under special forward auction more than doubled to 17.3 MT during the referred period against 8 MT booked in the corresponding period a year ago,” the statement added.

As part of the Union government’s attempt to ensure uninterrupted electricity supply from thermal power projects, captive coal mine production was directed to meet 85% of their targets in a week and state electricity distribution companies (discoms) procuring power from imported coal-fuelled projects were asked to meet their demand from such plants within two weeks.

Any failure to do so will result in coal supplies to such states being stopped. Also, coal supplies to power projects having more than 10 days fuel stock but with a plant load factor (PLF) of less than 40% and those projects having more than 18 days’ stock is to be stopped. In addition, coal supplies to those projects having stocks ranging from 11 days to 18 days and a PLF of more than 40% has to be halved.

PLF is a measure of output of a power plant. A higher PLF indicates higher output at lower cost.

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