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Coal imports may rise if PLF improves: AAP

In contrast with the government’s plan to stop import of steam coal by India within next two-three years, the Association of Power Producers (AAP) feels that imports may actually start rising if the Plant Load Factor (PLF) of thermal power plants improves.

“Production improvements by Coal India Ltd (CIL) notwithstanding, a recent report estimates that the private sector needs to achieve an average production growth of 32% if India is to cut its coal imports to 100 million tons (mt) by 2018-19. Considering that only 7 out of the 31 mines auctioned to the private sector have commenced production, it is unlikely that coal imports will completely cease over the next few years,” A K Khurana, director general, AAP, told ICMW.

“Further, it may be kept in mind that the quantum of coal imports is a function of power demand and if demand picks up and the under-utilised and stranded generating capacities come on stream, then the appetite for coal will increase significantly, leading to the possibility of higher imports,” he said.

“Looking at the low price of imported coal, it may be commercially beneficial to import coal for coastal plants and supply the full annual contracted quantity (ACQ) quantity to the inland plants and do away with the restrictive supply framework,” he added.

Source: ICMW