India’s energy transition story is a mixed bag in which the country is determined to achieve its target of having 500 gigawatts (GW) of installed power generation capacity from renewable sources by 2030, and at the same time it is also certain about not phasing out coal at least until 2040.
India will continue to rely on coal for power generation for two reasons revolving around energy security and affordability—the unprecedented growth in power demand which is likely to touch 335 GW by 2030 from the current 240 GW, and the high costs involved in energy storage which acts as a barrier to round-the-clock renewable energy supply.
Also read: Coal India to have Rs 80,000 crore capex over next 5 years: CMD PM Prasad.
To meet the growing demand, the government has revised its plan to increase the country’s coal-fired power generation capacity by 78 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.
Why the push for underground mining?
Since phasing out coal is not an option as of now, the government is looking at ways to mine the fossil fuel in an environmentally responsible manner. Of the two types of coal mining practiced across the world, India currently is heavily dependent on the opencast mining method, which is a surface mining technique that extracts minerals from an open pit in the ground.
The other technique is the underground mining method, which currently accounts for barely 4 percent of India’s total coal mining output. It is faster and extracts much higher quantities at one go with better quality coal.
However, opencast mining, despite being cheaper than underground mining, has its own disadvantages such as higher pollution due to overburden removal, the costs of land acquisition followed by rehabilitation and resettlement issues, and displacing forest cover.
The government, therefore, announced In June this year that Coal India Limited (CIL), the country’s biggest coal miner, will quadruple its underground mining production to 100 million tonnes (MT) by 2030 from the current 25.5 MT per year.
“Underground coal is superior in terms of quality and will help reduce imports of higher grades of coal. Besides, CO2 equivalent emissions in underground mining are lower by around 24 percent than opencast mines. For every 100 MT of coal produced through underground mines, CO2 emissions are down by about 2.4 MT,” PM Prasad, chairman, CIL, told Moneycontrol.
He added there is almost no land degradation in underground mining and it does not impact local communities much in terms of resettlement.
How does CIL plan to achieve its 100 MT target?
Underground mining, however, requires highly skilled workers which CIL said is now possible to deploy through outsourcing to contractors and proliferation of mass production technologies.
As per CIL’s roadmap, the company expects coal from underground mines to be around 31-34 MT in FY24, rising to 99-100 MT in FY28. “For underground mining, we plan to focus on continuous miners which is a mass production technology through which the environmental angle is also taken care of,” Prasad said.
When asked, a senior CIL official admitted that there was a definite cost difference. “About 1,000 tonnes of coal production through opencast mining costs about Rs 800, while underground mining costs about Rs 2,100-2,200. But we have to consider the fact that deeper deposits of coal can be best extracted through underground mining only. We were initially lagging in mechanisation. But now with the mass production technology through continuous miners, it is possible,” said the official, requesting anonymity.
CIL has also devised a strategic plan to phase out imports of heavy earth-moving machinery (HEMM) and underground mining equipment over the next six years. Currently, CIL imports high-capacity equipment such as electric rope shovels, hydraulic shovels, dumpers, crawler dozers, drills, motor graders and front-end loaders, valued at Rs 3,500 crore, incurring additional expenses of Rs 1,000 crore in customs duty. This approach aims to encourage and develop domestically manufactured equipment.
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