Why is country facing coal shortage?

New Delhi: The severe shortage of coal across the states, which is threatening power generation, is due to unprecedented increase in demand of electricity following revival of economy after second wave of covid among other reason, says the Centre..

According to the Power Ministry, the three other reasons include the heavy rains in coal mine areas during September, 2021, which has adversely affected the coal production as well as despatch of coal from mines.

Besides, increase in prices of imported coal to unprecedent high level leading to substantial reduction in power generation from imported coal based power plants leading to more dependence on domestic coal, and; non-building of adequate coal stocks before the onset of Monsoon are the other reasons for coal shortage.

There are also legacy issues of heavy dues of coal companies from certain states viz., Maharashtra, Rajasthan, Tamil Nadu, UP, Rajasthan and Madhya Pradesh.

The Power Ministry says that consumption for the period August-September has progressively increased from 106.6 BU per month in 2019 (normal non covid year) to 124.2 BU per month in 2021. During this period the share of coal-based generation has also increased from 61.91% in 2019 to 66.35% in 2021. As a consequence, total coal consumption in the month of August-Sept, 2021 has increased by 18% in comparison to corresponding period in 2019.

Imported coal price of Indonesian coal jumped from $60/ton in March-2021 to $160/ton (in Sept /Oct, 2021) of 5000 GAR (Gross as received) coal. The import of coal has decreased in comparison to 2019-20 due to import substitution and rising prices of imported coal. The reduction of imported coal is compensated by the domestic coal for power generation, hence increasing the demand for domestic coal further. As compared to 2019, there has been 43.6% reduction in power generation from imported coal which led to extra demand of 17.4 MT of domestic coal during Apr-Sept,2021.

Meanwhile, Punjab is once again heading towards major power outage with its thermal plants heading to deficiency of coal in wake of its inadequate supply against the agreements with various subsidiaries of the Coal India Ltd (CIL).

The situation in the national capital of Delhi is also grom. State Chief Minister Arvind Kejriwal on Saturday wrote to Prime Minister Narendra Modi over the issue.

The problem that has been continuing since August “has affected the power generation from the major Central Generating Plants supplying power to NCT of Delhi,” he wrote.

“The CERC Tariff Regulations (Regulation 34) mandates the generating station to maintain a coal stock of 10 days and 20 days for pithead and non-pithead stations respectively.”

According to CEA daily coal report, only a single day’s stock is left at NTPC Dadri-II, Jhajhar, and DVC (CTPS) and four days at Singrauli. Whereas, Mejia is out of coal stock.

“Under this situation, the dependency on Gas Stations supplying power to Delhi increases. However, the Gas plants supplying power to Delhi do not have adequate APM gas to run at full capacity,” Kejriwal wrote, adding, “If this situation continues unabated, it would severely impact the power supply situation in Delhi.”

–INDIA NEWS STREAM