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India Fears Power Crisis Due to Coal Shortage, Government Says All is Well

Reports of power plants decreasing production due to Coal shortage was already coming from various parts of the country. On 9th October Chief Minster of Delhi Mr. Arvind Kejariwal wrote a letter to Prime Minister regarding shortage of Coal for power production. Followed by concerns raised by State Governments of Punjab and Andhra Pradesh.

Coal Fired Power Plants Installed Capacity in India and the Present Scenario

India’s Coal-fired thermal power plants account for 208.8 GW (Approx. 54%) of India’s 388 GW total installed power generation capacity. Coal fired power plant’s supply share in India has also risen to 66.4% in 2020 against 61.9% in 2019 making them the main source to meet industrial and home power requirements in the country.

According to Ministry of Power’s data, shortage of Coal since mid-July has led to outages in thermal power plants across UP, Gujarat, Punjab, Maharashtra, Karnataka and Andhra Pradesh.

In July 2021, 1,750 MW of thermal capacity underwent forced maintenance due to the shortage of coal, an additional 5,985 MW of capacity faced outages in September. Another 3,695 MW was forced into outages in the first six days of October.

Scattered news from various Coal fired plants across the country is also coming. On 7th October 2021, the 1,500 MW thermal power plant in Suratgarh, Rajasthan had only one day’s Coal stock left. Important plants of Talwandi and Rajpura in Punjab had only 2-3 day’s stock left. The 1,820 MW Dadri thermal power plant, which is a key power supplier for Delhi, had only one day’s stock on October 6.

Reasons Given by Government Behind Depletion of Coal Stocks

Coal Handling

As per a release by the Ministry of Power, an inter-ministerial sub-group led by the Ministry of Coal has been monitoring the Coal stock situation twice a week. The Union Power Ministry has listed four reasons for the depletion of Coal stocks:

  • An unprecedented increase in demand for electricity during this Covid recovery phase
  • Heavy rains in Coal mine areas during September 2021
  • An increase in prices of imported Coal to an unprecedented high level
  • Non-building of adequate Coal stocks before the onset of Monsoon

The Power Ministry release further added “There are also legacy issues of heavy dues of Coal companies from certain states viz., Maharashtra, Rajasthan, Tamil Nadu, UP, Rajasthan and Madhya Pradesh”.

Daily consumption of electricity in India after the second Covid lockdown has crossed beyond 4 Billion units per day, out of this 65-70% of the demand is being met by Coal-fired power generation, thereby increasing dependence on Coal.

Assurances given by Government with Regards to Coal Reserves

While the news of Coal stock shortage is coming from various parts of India, Union Ministry of Coal says everything is under control. In its release, the Coal Ministry saidample Coal is available in the country to meet the demand of power plants. Any fear of disruption in power supply is entirely misplaced”.

It further added “1.92 million tonnes (MT) of Coal was despatched to thermal power plants on October 9, compared to the total consumption of 1.87 MT, indicating a change in the situation towards a gradual building-up of stocks”.

Coal India Ltd CIL logo

Union Coal Minister, Mr. Pralhad Joshi in a tweet on 10th October 2021 said “Assuring everyone that there is absolutely no threat of disruption in power supply. There is sufficient Coal stock of 43 million tonnes with Coal India, equivalent to 24 days coal demand”.

Even referring to the statement from the Ministry, if our national Coal stock is of 24 days then how can we expect power plants in remote locations to maintain 15-30 days standard Coal stocks by surpassing the difficulties in logistics chain.

Other Steps taken by Government to tackle Power Crisis

The Power Ministry issued guidelines on 8th October 2021 for optimum utilization of generating stations as per the requirements in the electricity grid. These guidelines will enable imported coal-based plants (having sufficient coal) to operate and ease out the burden on domestic coal.

World Scenario with respect to Coal Shortage and Resulting Power Crisis

It’s not that only India is feeling the impact of Coal Shortages. China has already ordered partial or complete shutdown of few of its industries.

With strained supplies of Natural Gas from Russia, European nations have to turn towards Coal supplies for their energy needs, but Coal supplies of Europe are already under strain this time of the year due to domestic heating requirements during winters. US too is now experiencing strain on its Coal reserves as global Natural Gas prices are soaring.

As far as India’s power supply scenario is concerned, we expect Coal supply to be better in coming months. Rationale behind this being that Coal production from mines that were disrupted by untimely rains this year have resumed, and household power demand is lesser in India in winters as compared to summers.