DELHI, NEW DELHI: According to two government officials familiar with the plan, the government may soon begin negotiations with Russia, Australia, Indonesia, and South Africa to assist state-run Coal India Ltd in importing coal at a discounted rate as an emergency measure to avoid a fuel shortage for the country’s overworked power plants and create buffer stocks.
India chose the government-to-government import route because domestic supplies will not be sufficient to meet the needs of daily power plant fueling and to build sufficient stocks for the monsoon season, which runs from June to September, when mining and coal off-take slows due to heavy rains or flooding.
India chose the government-to-government import route because domestic supplies will be insufficient to meet the needs of daily power plant fueling and to build sufficient stocks for the monsoon season, which runs from June to September, when mining and coal off-take are slowed by heavy rains or flooding.
The increased demand for electricity has led to a rapid depletion of fuel reserves at power facilities. The 173 power plants monitored by the Central Electricity Authority (CEA) have a coal stock of 23.32 million tonnes (mt), which is only about 35% of the required supply.
Nine power stations using imported coal had critical coal inventory, while 84 power plants using domestic coal had less than a fourth of their prescribed fuel storage
. The government is concerned that low inventories may result in an even worse power outage in September and October if state-run energy distribution companies do not stock enough coal in time for the monsoon. The external affairs ministry will lead the government-to-government talks, which will also include the finance, coal, and power ministries, as well as state-owned Coal India.
“The ministry of external affairs is studying diplomatic avenues from all available sources for importing coal for blending purposes,” said one of the two senior government officials listed above, who asked to remain anonymous.
The anticipated coal imports will be in addition to NTPC Ltd and Damodar Valley Corp’s imports for fueling state-run and commercial power facilities.
India, which has the world’s fourth-largest coal reserves, is importing the fuel amid blackouts caused by a jump in electrical demand worsened by a severe heat wave. To create energy, India’s power plants burn about 2 million tonnes (mt) of coal every day
. “The goal is to obtain coal at agreed rates from the world’s largest coal-producing countries, including Russia, Australia, Indonesia, and South Africa.” As a result, it makes sense for Coal India to import on behalf of state gencos and IPPs (independent power producers),” said the second official, who did not want to be identified.
Follow and connect with us on Facebook, LinkedIn & Twitter
