Coal news and updates

Private power firms are seeking higher coal supplies as Coal India (CIL) has announced that state firms have cut fuel purchases due to their weak finances. They say newer plants built by companies are more efficient and can better utilise the scarce fuel to meet the country's demand. 

 

CIL earlier said it had a pit-head stock of 40 million tonnes at the end of February as offtake has been falling since last September, creating an ironical situation where thousands of megawatts of capacity is stranded due to fuel shortage while the monopoly producer is sitting on a growing heap of unsold coal. 

 

Association of Power Producers (APPs) wrote to the ministry of coal saying that attributing reduced offtake to sluggish demand does not convey the right picture. "This gives an impression of reduced demand from all power generating utilities leading to a surplus coal availability scenario. 

 

However, our interaction with private generators clearly shows that in many cases they have not been receiving adequate coal quantities as per the 65% level decided by CCEA. In fact, some of the private generators have actually been receiving progressively reducing supplies over the last few months," APP director general Ashok Khurana wrote to coal secretary SK Shrivastava. 

 

Indian Captive Power Producers Association (ICPPA), which represents industrial houses that are generating electricity for their captive requirements, has also sought higher coal allocation and supplies. ICPPA secretary Rajiv Agrawal said that captive power producers have been complaining of poor quality and unavailability of adequate coal supplies besides CIL charging 30-35% more for its supplies to them. "Higher coal supplies to captive power producers will give great relief to the industry that is often dependent on imported coal. We have written to the authorities concerned to allocate industry the unused coal," said Agrawal. 

 

APP said that unused coal should be diverted to those plants that have not received the approved level of 65% domestic coal from CIL. It requested the coal ministry to initiate necessary action to ensure higher supplies to power producers in a situation where (CIL) has adequate inventories. 

 

Private power companies are struggling because CIL's output has not been able to keep pace with growing demand. Many power plants are idling while others are running at sub-optimal capacity because of the acute scarcity in the country, whose reserves of coal are among the highest in the world. 

 

 

Source: ET