CIL draws up Rs 16,000-crore capex plan for FY26, bets big on RE, thermal power
04 Jun 2025
Coal India plans a Rs 16,000 crore capex for FY26 focusing on coal production, renewable energy, and thermal power. Targets 875 MT coal output, 3 GW solar capacity by 2028, and advances coal gasification, pumped storage, and critical minerals to diversify and boost sustainable growth. State-owned Coal India has charted out a Rs 16,000 crore capex plan for the fiscal 2025-26 spread across coal production, renewable energy (RE), and thermal power projects. With a coal production target of 875 million tonnes in FY26, the company is also advancing its diversification into solar, coal gasification, thermal power, and critical minerals, chairman -cum-managing director P M Prasad told Arunima Bharadwaj in an interview. The company aims at installing 3 giga watts (GW) of RE capacity by 2028 and is keen on pumped storage power projects. What is Coal India’s target for coal output in FY26? CIL has been given an 875 million tonne (MT) coal output target for FY 2026. For the power sector we are aiming at 668 MTs. The actual supply to power utilities during FY25 was 616 MTs. Target for coking coal production is pegged at 76 MTs. ALSO READ Who is Manish Tiwary? Next Nestlé India Chairman and MD What is your capital expenditure plan for FY26? CIL as whole has a capex target of Rs. 16,000 crore for FY26. Depending on the requirement this may even go up higher. During the past few years we have already heavily invested in large equipment, land, evacuation infra etc. Of this year’s total capex, cumulatively, coal transportation and evacuation infrastructure which includes setting up rail sidings and corridors; coal handling plants/silos; and roads account for over a third at nearly Rs. 5,622 crore. This is followed by land, at Rs. 2,382 crore. Heavy earth moving equipment, washeries, and other plant and machinery make up Rs. 1,952 crore. Other heads like mine development, solar, JVs and pithead power plants consume the remaining capex. What are the key sectors where CIL is diversifying into to generate additional revenue streams? What will the investments be like? Solar power of 3000 MW capacity by FY28 tops our diversification portfolio. Coal gasification is another avenue that the company is pursuing vigorously. On this front, we have aligned with three PSUs, through joint venture mode. Bharat Coal Gasification & Chemicals Limited, a JV of CIL and BHEL has been incorporated for setting up a coal gasification based ammonium nitrate project of 6.6 lakh tonnes per annum capacity at Lakhanpur, Odisha. Coal Gas India Limited, a JV between CIL and GAIL, deals with coal-to-synthetic natural gas of 633.6 million normal cubic metre capacity at Bardhaman, West Bengal. The gasification is technology capable of gasifying coal having high ash content in the range of 18% to 30%. For a similar project having similar capacity, which would come up in Chandrapur Maharashtra, CIL has joined hands with BPCL. Coal Gasification Plant Development and Production Agreement was signed with the Ministry of Coal for financial support of Rs. 1,350 crores for each project. We are also pushing for two pithead based thermal power units. One is MBPL, fully owned by our subsidiary MCL. It will be an ultra-super critical thermal plant of 2X800 MW in the first phase. It will have a capital investment of around Rs. 16,000 crores. The other is a JV on 50:50 equity sharing with Damodar Valley Corporation – a 2×800 MW ultra-supercritical thermal power plant in Jharkhand. It is a brownfield project that will expand the existing Chandrapura Thermal Power Station and is estimated to cost around Rs. 16,500 crore.