Coal news and updates

NTPC’s ‘dil maange more’ coal!

September 1: NTPC Ltd Chairman Arup Roy Choudhury has said the current supply of domestic coal is fine, but the PSU is not too satisfied because it is a kind of a “dil maange more” scenario.

“It is like dil maange more. If you see, CIL has signed FSAs to supply coal to us. By and large, they are meeting their FSA commitments towards the end of any financial year. But the country wants much more power than that is being generated through FSA coal,” Choudhury said when asked by ICMW whether he is satisfied with the current coal supply position.

He pointed out that during the recent summer season, there was a huge demand for power and consequently demand for coal. The volume supplied via the FSA clause was not enough. The scenario is thus but questions are raised why enough coal is not available in the country.

“But the fact is whenever there is demand for power we will have to burn coal to generate that power,” he said.

Asked about CIL’s allegations that the shortage in coal can be traced to low imports by the power plants and their tendency to operate at a higher plant load factor (PLF), Choudhury said, “This (operating at high PLF) is not of our choice. We are compelled to operate at high PLF in the interest of the nation.”

Being a government-owned company, NTPC cannot just reduce or stop production whenever there is any issue, he said, adding, “Recently, there was a Supreme Court order, after which some of the generators stopped producing power. But we cannot do that. NTPC is owned by the government, and we cannot say we will stop generation because of certain issues.”

“Higher generation is due to higher demand. However, this has to be appreciated that CIL is also correct because it has to supply coal to the extent we can operate at 71% PLF. But who is allowing me to operate at 71% PLF? As per the CERC/CEA directive we have to operate at 85% PLF. Most of our plants are operating at above 85% PLF and the situation is such that even if we operate at 100% PLF, there will be takers for power,” Choudhury said.

This is happening because of the fact that power supplied by NTPC is the cheapest among all generators and also because of the fact that there is huge demand for power in the country, he said, adding, because of the situation, NTPC has no option other than to operate at a high PLF.

Asked on the recent cancelling of an enquiry for 5 million tons of imported coal, as reported by ICMW, the CMD said, “There is no specific reason. Basically, we want to reduce cost in whatever way possible. Even if there is $1 reduction in coal prices, it goes to the benefit of the consumer.”

Asked whether scrapping of the enquiry will lead to delay in procurement of imported coal, the CMD said, “Even if it leads to delay in procurement, we have to go for it.”

Asked about his views on reports that unless NTPC’s captive coal blocks come to production as per schedule it will face huge shortage of the fuel, the CMD said, “Hypothetically, I will agree with you 100%. Naturally, all capacity addition in power generation is planned with coal supplies.”

“But the only silver lining is that, as per leading experts, it takes only two years to start coal production from a mine while, on the other hand, a power project takes four year to go on stream. So that way there is little comfort for us that coal will come,” Choudhury added.