Coal stocks at thermal power plants have hit a historic high of 54 million tonnes (MT) with a record 1 billion tonnes (BT) of the dark matter being produced this fiscal year.
Speaking to Moneycontrol, Vismita Tej, Additional Secretary, Ministry of Coal, said the government is well prepared for a searing summer, and also discussed the steps taken for faster and efficient coal evacuation and the challenges faced, among other things.
Tej heads the Inter-Ministerial Sub-Group, comprising representatives from the Ministry of Power, Coal, Railways, the Central Electricity Authority (CEA), Coal India Limited (CIL), and Singareni Collieries Company Limited (SCCL), constituted to address coal supply issues for thermal power plants and related contingencies.
Edited excerpts:
The coal situation has improved since the 2021 crisis, when there were blackouts across the country due to severe shortage at power plants. What does it take to ensure that power plants do not run out of fuel?
It takes micro-level planning. At the beginning of the (financial) year, the Ministry of Power assesses and states how much coal it needs from us. For FY26, they have asked for 906 MT.
Once we receive the requirement, we divide it and give monthly targets to our three sources for coal supply — CIL, SCCL, and captive commercial coal mines.
CIL and SCCL in turn set production targets for their subsidiaries as they have fuel supply agreements between their mines and the power plants. All this is just for the power sector. The three sources also produce coal for the non-regulated sector, which goes to industries such as steel and cement.
Next comes coordination, which is the most important. The Inter-Ministerial Sub-Group, formed after the 2021 crisis, meets twice a week and reviews the overall situation, including logistics. Individual cases (of a power plant or mine) are also discussed. In fact, if some power plant has more coal than it needs currently, we shift it to a plant that needs it.
Then there is an Inter-Ministerial Committee (IMC) above the sub-group which meets once every month or two, where any issue that needs escalation is put up.
Power demand is increasing by 8-10 percent annually. With the IMD predicting more heatwaves this summer, are you confident of smoothly sailing through the crunch period?
This year we already had a major event, the MahaKumbh, where about 10-12 upcountry power plants (Singrauli, Unchahar, Rihand, etc) could have been impacted due to high congestion of railway routes. But there was no crisis because we kept the plants well stocked in advance. Dedicated freight corridors also helped.
Another reason for good coal stocks at power plants was the milder winter this year, because of which the power demand wasn’t as high (for heating) compared to other winters.
We have 54 MT coal stocked at thermal power plants, 123 MT across CIL and SCCL mines, and another 4.5 MT in transit at any given point of time — at least 182 MT of coal is currently available across our value chain. Hence, we are in a very comfortable position for peak summer.
How much of the logistics plan has been implemented on the ground?
The National Coal Logistics Plan was launched in February 2024, and it is mostly the railways which is implementing it since the aim of the plan is to reduce road transportation of coal due to pollution and other issues.
It has 14 rail infrastructure projects focussed on improving coal evacuation from high-growth mining areas. All of them are currently in different stages of development.
While the coal mines are on the eastern side of the country, the industrial development has happened in the western part of India, which is why the evacuation of coal from the mines to the end-users (power plants or industry) was the biggest problem. So the logistics plan includes building first-mile infrastructure at coal mines, down to planning for new railway lines for transportation.
The shift from roads to railways is expected to reduce logistics costs by up to 14 percent, resulting in annual savings of approximately Rs 21,000 crore.
Can you quantify how streamlining coal logistics has helped the sector?
The barometer of better logistics is the fact that coal imports by domestic thermal power plants have gone down by 30 percent this year compared to last year. This happened also because railway rakes for coal transportation, a part of the logistics planning, increased by 6 percent during this period.
The plan also includes promoting the rail-sea-rail (RSR) route, which has seen tepid response.
Initially yes, but now RSR has picked up. Coal movement, which was 28 MT in FY22, almost doubled to 54 MT in FY24 through the RSR route. Our aim is to further double it by 2029-30.
When do we expect the National Coal Exchange to be rolled out?
It is currently under discussion and will be launched once the necessary approvals are received.
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