Government aims to slash imported coal stocks at thermal power plants to 2% by FY25: Pralhad Joshi

Coal

To boost domestic coal production and reduce reliance on imported coal for power generation in India, the government has set a target to decrease stocks of the imported variant of the fossil fuel to 2 percent from the current 4.6 percent, Union Minister for Coal, Mines, and Parliamentary Affairs Pralhad Joshi said on December 20.

"Currently, only 4.6 percent of all coal stocks at thermal power plants (TPPs) constitute imported coal. Last year, at the same time, it was nearly 10 percent. Next year, under the leadership of Prime Minister Narendra Modi, we will further reduce the share of imported coal in the total coal stocks at TPPs to 2 percent. By 2025-26, we will bring this down to zero," Joshi said at the launch of the ninth round of commercial coal mine auctions on December 20 evening.

A total of 26 coal mines are being offered in the ninth round. Of these 26 mines, three mines will be offered under the Coal Mines (Special Provisions) Act 2015 (CMSP), while the remaining 23 mines fall under the Mines and Minerals (Development and Regulation) (MMDR) Act 1957. If looked at by states, 12 are in Madhya Pradesh, eight in Chhattisgarh, five in Jharkhand, and one in Telangana.

The Union minister said that despite rapid strides in renewable energy generation in India, coal will remain the mainstay to ensure energy security for the country.

"By 2030, India's demand for electricity will double, and to cater to this spike in power demand, India will have to rely on coal. That is why, whereas earlier we used to mine only 500-600 million tons (MT) of domestic coal in India, this year, hopefully, we will cross the 1 billion ton (BT) mark—the highest ever in India's history," Joshi said.

The unprecedented growth in power demand is likely to reach 335 GW by 2030 from the current 240 GW. Despite the push for renewable energy, the high costs involved in energy storage act as a barrier to round-the-clock renewable energy supply. As a result, the government has revised its plan to increase the country’s coal-fired power generation capacity to about 80 GW by 2030 instead of 51 GW as was planned earlier. This means more coal needs to be mined for increased supply to thermal power plants.

Also read: Coal India to have Rs 80,000 crore capex over next 5 years: CMD PM Prasad.

India has 15 imported coal-fired power plants. But since the country's power demand is rising at a faster pace than the increase in the production of domestic coal, the Ministry of Power on October 25 directed all thermal generating stations in India, including Independent Power Producers (IPPs), to mandatorily blend imported coal at 6 percent of their total capacity till March 2024. The mandate was earlier limited to blending at 4 percent.

The government has also extended the emergency clause (Section 11) of the Electricity Act, 2003, mandating imported coal-based power plants to run at their full capacity till June 30, 2024.

India is the world's third-largest consumer of energy, with an annual electricity demand increase of about 4.7 percent. Amid record-breaking demand, the country witnessed an 8.18 percent surge in overall power generation from April to October, compared to the same period of the previous year. This includes all forms of power generation - thermal, renewable and so on.