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New UserSolar, Wind focus has hit low-cost coal-based power production: Partha BhattacharyyaSolar, Wind focus has hit low-cost coal-based power production: Partha Bhattacharyya
06 Sep 2016
The country could have produced an additional 170 billion units of power at
around rs 1.75 per unit the variable cost, if the government went slow on fresh capacity
addition projects and instead ramped up capacity utilisation of running thermal power plants.
"It could have powered 170 million homes and created additional demand for 120 million
tonnes of coal that could help mitigate the present oversupply situation of coal," Partha
Bhattacharyya, former Coal India chairman, told reporters at 10th International Coal Markets
Conference organised by mjunction on Monday.
"The foregoing of thermal power resulting from fall in capacity utilisation from 75 per cent to
62 per cent as a result of displacement by solar and wind power, the cost of which is over Rs
4.25 per unit, places an additional burden of over Rs 42,500 crore on the overall cost of
power generation. This is certainly not in sync with the imperatives in a country where
affordability needs to remain a key area of focus in the power policy," he said.
At present, the country is faced with some 70 million tonnes of stock of which 45 million tonnes are stacked at coal mines while the rest at
25 million tonnes are staked at power plants.
Stocks have built up because growth of demand for power has been at a lower rate than anticipated leading to more coal production than
could be consumed. Not everyone agrees with Bhattarchayya's views.
A senior analyst from one of the Big Four accounting firms, said: "Power from different sources has different usage. For example, while
thermal can be used for base load, solar could cater to day peak demand. Hydel canbe turned on and off when necessary...While coal
costs are low today, there is no certainty that coal prices would be at the same level tomorrow if demand rose," he said.
Bhattacharyya said: "If firm commitment to 175 GW renewable power programme is the cause of the present state of affairs, there is need
to pause for a while and rethink. Solar power with all its positive features will surely emerge as the leading source of power in course of
time. A policy support to make that happen is undeniable. However it needs to be calibrated in a manner that does not deny the country
the advantage of harnessing low cost coalbased power from existing capacity to the maximum till such time the solar power cost drops
below the marginal cost of coalbased power.
SOurce: ET