'Need to augment coal production as fast as possible; State gencos to continue import': RK Singh

Power Minister RK Singh (Source: Twitter/@OfficeOfRKSingh)

At a time when India is facing a power supply and coal crunch, RK Singh, Minister of Power and New, Renewable Energy said that coal production in the country needs to increase as soon and as fast as possible.

India’s power demand hit an all-time high of 210.8 gigawatts (GW) on June 9, driven by a spike in demand from households amid an ongoing heat wave and a pick-up in industrial demand.

''India's power demand this year increased to about 40-45,000 megawatts on a daily basis, and in energy terms, the demand and consumption went up to 4,500 mili units from 3,500 mili units - which is an increase of 25 per cent,'' said RK Singh in an exclusive interview with CNBC-TV18.

State-generating companies have been instructed to continue imports as the coal imports by states fell drastically, which was one reason that led to the shortfall in domestic coal production.

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State gencos to continue imports

According to latest data by the Central Electricity Authority (CEA), thermal power plants in India have nine days' worth of coal stock available as of June 6, which could result in power outages, due to a shortage of dry fuel amid the rising electricity demand because of the heatwave conditions.

The current coal stock stands at 22.082 million tonnes at 150 power plants, while 2.544 million tonnes is the daily requirement for the same. For 15 power plants designed on imported coal, the total coal stock is 1.845 million tonnes and the daily requirement is 0.158 million tonnes, according to CEA.

“Coal India and ministry of coal have increased their production. There is still a gap between our requirements and the supplies of domestic coal, so we decided to import. We have asked the state-generating companies to import — NTPC too,'' Singh told CNBC-TV18.

''The average shortfall in consumption for power generation and the arrival of domestic coal has been to the region of about 10 percent. So, that will be the quantum of coal which will be imported for blending,'' said the Power Minister.

However, some issues constantly plague the augmentation of coal production at a swift pace. Environment clearance system takes one year, for a new coal mine to be cleared. Land acquisition takes one year and rehabilitation of people who are offset takes another year. So, starting a new coal mine takes atleast three years, explained Singh.

Also Read: After maiden coal import tender, Coal India gears up for a second tender to boost domestic supplies

Coal India to the rescue
Coal India, the world's largest coal miner, issued a tender to import 2.42 million tonnes of coal by end-September to boost fuel availability amid fears of a shortage.

After its maiden tender, the state-run miner is gearing up to launch a second tender soon, which will look at securing coal in the year till mid-2023. Coal India has approvals to issue a short-term and a medium-term tender.

The short-term tender, which aims at coal supplies for July-September in the current fiscal year, has already been launched. Sources told Moneycontrol that the second tender may be launched between June 11-13.

A statement from the state-run miner read, ''Though coal import is an uncharted terrain for CIL, within a week of receiving indents from the 7 State Gencos and 19 IPPs, for a total of 2.416 MTs of coal, the company on a war footing has finalized and floated the tender.''

''Coal India is also going to import an additional 12 billion tonnes and keep that as a buffer stock to make sure that if there is any further shortfall in domestic coal, they will be able to supplement that,'' said Singh.

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Energy transition: Roadmap for next 3-5 years

On the government's roadmap for the next three to five years, the power minister remains optimistic on India's energy transition plans. He revealed that while coal will continue to be a major player for India's power generation, plans for expediting hydro for fulfilling the same purpose are underway.

“Our energy transition is happening at a rapid pace. Other is that coal will continue to be a major thing, but we are adding hydro. We have another about 12,000 megawatts of hydro under installation and are going to start more projects, but coal will still continue to occupy a large space in our power generation plants.”

He said the coal ministry is taking steps to enhance production of coal and highlighted that there are also steps need to be taken to enhance the mechanisms for evacuation of coal. ''The railway ministry is adding to the lines so that evacuation becomes faster,'' said Singh.