KOLKATA (miningweekly.com) – Coal India Limited (CIL) has committed $758-million in the current financial year for its foray into thermal and solar power generation projects.

According to preliminary plans, CIL’s entry into thermal and green energy is likely to include two 800 MW coal-based power plant in the eastern Indian province of Odisha and an aggregate 600 MW of solar projects spread across four provinces. The company plans to extend its power generation capacity by another 1 000 MW in the second phase of its investment plans.

However, no clarity is available on whether CIL’s venture into power generation is linked to falling demand for coal, which is the primary business of the mining behemoth.

The thermal power project will be implemented through super-critical technology and linked to coal feedstock from CIL’s Mahanadi coalfields in Odisha, a company official says.

Last month, CIL’s coal production was recorded at 32.4-million tons, down 10.4% year-on-year, while the target for September has been set at 40-million tons. During April to August, coal offtake was recorded at 211.38-million tons, a growth rate of a mere 0.2% year-on-year. Pithead stocks were estimated at around 40-million tons as offtake by thermal power plants across the country slowed down.

Government data shows that the country’s thermal power plants are operating at an average plant load factor (PLF) of 59.28%. CIL estimates that coal offtake will improve the average PLF to levels of above 70%.

Nonetheless CIL officials are cagey in linking the downturn in coal demand to its foray into energy generation projects, underlining that the miner’s plans to achieve a one-billion coal production target by 2020 are well on track, and categorically denying recent media reports suggesting that the target was diluted owing to the surplus coal availability in the country.

CIL’s green energy projects will involve setting up floating solar panels on water bodies. The miner has numerous water bodies, which formed after mines closed down. While the miner is equipped to set up floating solar panels on shallow water, it is developing in-house technology to put up solar panels on deep water.

However, CIL is not the only coal miner venturing into green energy. NLC (formerly Neyveli Lignite Corporation) has drawn up plans to implement aggregate solar power generation capacity of  4 000 MW and last month kick-started it by starting a 65 MW solar power plant.