Most of the power, steel and aluminium industries are faced with a crisis due to shortage of coal. Various mines and mineral experts have urged the Government to increase coal supply against secured linkages for sustainable industry operations.
As many as 63 of the 135 coal-fired power plants of the country have two days or less of coal supplies as per Central Electricity Authority (CEA). Coal stocks at 17 of them have been run down to zero. In total, 75 plants are running with five days worth of coal or less. By September 21, coal inventory of power plants declined 37per cent, 8.08 MT from 12.76 MT. PSU Nalco has got only eight days coal stock at its Angul plant.
Nalco’s daily average requirement is 16,000 MT. However, it has received only 8,500 MT daily in month of September. As Nalco is not a consumer based unit, it needs uninterrupted power supply to keep alive its smelter plant. Anticipating further crisis, the Nalco management has taken proactive steps by importing 200MW power daily.Demand for power has risen sharply as India's economy picked up after second wave of Covid-19. Power consumption in last two months jumped by almost 17per cent . Whereas global coal prices increased by 40per cent, India's imports fell to a two-year low.
Power plants that usually rely on imports are now heavily dependent on Indian coal, adding further pressure to already stretched domestic supplies.
The coal shortage has impacted the entire manufacturing sector- cement, steel and construction, etc. Jindal Steel and Power Limited MD VR Sharma said mills are paying more than four times the normal costs for procuring coal in e-auctions and from mines. A tonne of coal, which was in the range of Rs 4,000-6,000, is now costing Rs 8,000-Rs 12,000, told Sharma. However, with the end of the monsoon season and efforts of Coal India to boost production, supplies should improve, he hoped.
Writing a letter to Secretary to the Government of India, Ministry of Coal Anil Kumar Jain, Sharma who is secretary, Federation of Indian Mineral Industries ( FIMI), expressed concern over critical coal shortage for Non-Regulated Sector (NRS) and requested for immediate resumption of coal supplies for economically viable and sustainable domestic industry operations.
Among others, he suggested for expediting coal linkage auctions / exclusive e-auctions for NRS consumers through rail mode at the earliest to provide some relief for the consumers and rakes allocation on priority for CPP based industry for optimum coal materialization.
Sharma urged the Government for allocation of coal dispatches through rakes in proportion of 75per cent (power) and 25per cent (non-power), in line with Ministry of Coal circular dated February 15, 2016 for auction linkage.
Meanwhile, the Ministry of Coal has amended Mineral Concession Rules, 1960 with a view to allowing sale of coal or lignite, on payment of additional amount, by lessee of a captive mine up to 50 per cent of total coal or lignite produced in a financial year, after meeting the requirement of the end use plant linked with the mine.
Earlier this year, the Mines and Minerals (Development & Regulation) Amendment Act had been amended to this effect. This is applicable for both the private and public sector captive mines.
With this amendment, the Government has paved the way for releasing of additional coal in market by greater utilisation of mining capacities of captive coal and lignite blocks, which were being only partly utilised owing to limited production of coal for meeting their captive needs. Availability of additional coal will ease pressure on power plants and will also aid in import-substitution of coal.