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Indian thermal power plants reeling from coal shortages

24th May 2018

By: Ajoy K Das

Creamer Media Correspondent

     

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KOLKATA (miningweekly.com) – Private and public thermal power plants across India are facing an acute shortage of coal, at a time when rising electricity demand during summer months has sent the spot price of electricity skyrocketing.

According to data sourced from industry policy advisory body, the Central Electricity Authority (CEA), power stations with a combined generation capacity of 140 065 MW had coal stocks of 15.006-million tons at April 22, the equivalent to about nine days’ consumption, against a CEA stock requirement of 22 days.

Of these, four thermal power plants were carrying stocks equivalent to less than seven days’ worth of consumption, which the CEA categorises as “critical stock”, while another 17 thermal power plants had stocks for less than four-days’ consumption, categorised as “super critical” as of April 23.

The stock data relates to all thermal power plants in the country, private, public, joint ventures and captive, which have coal supply linkage with domestic coal producing companies.

Significantly, all 21 power plants carrying a critical level of coal stocks were ‘non-pithead’ plants and an indication that a large part of the coal shortage across the country was on account of logistical and infrastructure challenges, industry officials pointed out.

The government data on the current stock position indicated that, of total coal stocks with thermal power plants of 15.006-million tons, only 452 000 t constituted imported coal.

According to unconfirmed reports, four thermal plants of government-owned utility and largest power producer, NTPC, had nil stocks of fuel as on this date.

Sources in private power generation companies, which largely rely on blending imported coal with domestic dry fuel, said that importing coal to tide over domestic shortages is not an option with the landed price of imported thermal grade coal at a high of $100/t.

Resorting to imports at such high costs would make operation of the plants unviable as plant operators did not have the option of passing through higher costs to electricity buyers, or distribution companies (discoms).

Unlike government-owned utilities, private producers generally do not have their own source of coal and are unable to increase their plant load factor (PLF), which averages at about 52%, compared with 58% last year. The lower generation output is resulting in higher power tariffs for discoms, sources in private power companies said.

It was pointed out that the spot electricity price, which is at a five-year peak of Rs11.41 a unit, has not yet had a widespread impact on consumers, as traded electricity only accounts for about 5% to 6% of total demand.

However, sustained shortages of thermal coal would force plants to reduce PLF, which, in turn, would impact tariff-based supplies to discoms, the sources added.

 

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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