Coal India Limited (CIL) has set a target to produce 838 million tons (MT) of coal in the financial year 2024-25, of which 661 MT will be supplied to the power sector alone, the state-owned company's chairman and managing director (CMD) PM Prasad said.
"Earlier, the target for Coal India was 850 MT. But currently, there are huge coal stocks at thermal power plants (TPPs) because of which the ministry has revised our production target to 838 MT for FY25. That said, if the power demand increases substantially, Coal India will still be in a good position to produce more than the said target," Prasad said in a post- earnings conference call for the third quarter of FY24.
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Of the 838 MT, 661 MT will be for the power sector (regulated sector),while the balance 177 MT will go to the non-regulated sector.
Prasad said currently, coal stocks at TPPs are close to 85-100 MT, which is sufficient, and that a review of the coal production target for FY25 will be conducted by the ministry again some time in the first week of April.
India's power demand has gone up by 50.8 percent in energy terms from 2013-14 to 2022-23. The peak power demand has gone up from 136 GW in 2013-14 to 243 GW in September 2023. Talking about the country's growing power demand in Moneycontrol's Policy Next Summit on January 18, Union minister for power RK Singh said on a daily basis, the demand is 8-10 GW more than the same day of the previous year. "The demand grew at 9 percent last year, and is growing at 10 percent this year," he said.
India is stepping up coal-fired generation capacity as peak electricity demand is likely to touch 256.5 GW in 2024 from a record 243 GW in 2023. Government officials expect electricity demand to surge to a high of 384 GW in 2031-2032.
To meet the sharp rise in India's power demand, the government has had to rely on imported coal so as to ease the pressure on domestic coal. On December 6, 2023, Singh said despite the country reeling under a shortage of domestic coal, widespread power cuts and blackouts were averted in September 2022 because of the government's mandate of using imported coal for blending at thermal power plants.
"The gap between daily coal consumption and daily arrival of domestic coal ranged between 2.65 lakh tonnes to 0.5 lakh tonnes between September 2022 and January 2023. If the imports for blending had not been made, coal stocks in thermal power plants would have reduced to zero in September 2022 and would have continued so, leading to widespread power cuts and blackouts," the Union minister said in a written reply to the Rajya Sabha.
However, now with domestic coal stocks improving at thermal power plants due to increased production, Coal India is hoping that imported coal will gradually start declining. "Apart from catering the domestic demand, we believe we will also soon be able to reduce the import of about 200 MT of substitutable coal," Prasad said.
The coal miner, the largest coal producer in the world, had registered the highest-ever coal production of 703.2 MT in the last financial year.
For the current financial year (2023-24), Prasad said Coal India may miss the production target of 780 MT (FY24) by about 10 MT. Of the 780 MT, 610 MT was cited as the requirement for the power sector, but Prasad said Coal India will be supplying more than that.
“780 MT is our target (for FY24). Five companies (subsidiaries) are already ahead of the targets, but SECL (South Eastern Coalfields), due to some land shortage there initially, is lagging behind by around 8-9 MT," he said.
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