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Low imports by power plants causing coal shortage: CIL

August 7: Asserting that Coal India Ltd (CIL) alone should not be blamed for low coal stock positions at power plants, an official from the company said some of the power plants too are responsible for the prevailing low coal stocks.

“Lower-than-planned loading due to rake shortage could have been one of the reasons for low supply of coal to power plants, but higher generation is also equally important for low coal stocks at power plants,” a top official from CIL told ICMW.

“Almost all the new power plants are supposed to get only 65% of their total coal requirement from us as per the fuel supply agreements (FSA) and the rest of the fuel is to be sourced through imports. But, instead of arranging for imports, these plants are blaming us for their low coal stock positions,” the official said.

“However, instead of arranging for imported coal, the power plants are trying to find fault with CIL,” the official said.

“They are not arranging for imported coal either through their own means or us. They are also operating at a higher plant load factor (PLF), thereby further deteriorating the situation,” the official said.

“Our coal supplies to the power sector during the first four months of 2014-15 (April-July) were 88% of the annual action plan (AAP). This includes both old plants, to which we have to supply 90% of their total normative requirement and new plants, to which we have to supply 65% of their total normative requirement,” the official said.

Explaining the point, the official said, “The trigger level to attract the penalty clause for old plants is 90% of the FSA and for new plants, 65% (for domestic coal). In certain places where both new and old plants are running together, it has been found that the average PLF is over 100%. If they are running at more than 100% PLF against the normative 85% and have not arranged for imported coal, they will naturally face coal shortage.”

In such a scenario, where new plants are operating at higher PLF, they are facing shortage of coal and their stocks are depleting, the official added.

“There is no solution as such against low coal stocks at some of the plants because they will get domestic coal only to the extent of 65% of the total requirement as per the FSA,” the official said.

To press home his point, the official said, “If we talk about NTPC or any other plant, they know well that they have added many new units and will have to use imported coal because CIL’s commitment is only to the extent of 65% of their total requirement and they should have arranged for the balance coal on their own.”