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Power supplies to improve in 4-5 days: Shinde

India's power supply situation will improve in the next four-five days as coal supply to power plants is slowly picking up, power minister Sushil Kumar Shinde said on Friday.

business Updated: Oct 14, 2011 19:24 IST

India's power supply situation will improve in the next four-five days as coal supply to power plants is slowly picking up, power minister Sushil Kumar Shinde said on Friday.

Floods in Orissa, a strike at state-run Coal India Ltd, the key supplier, and political protests in Andhra Pradesh had hit coal supplies, leading to lower power generation and blackouts in cities earlier this week.

India holds 10% of the world's coal reserves but local supplies are falling short of demand as the country builds more power plants, and as domestic coal projects run into environmental and land acquisition delays.

Shinde said power plants with sufficient coal stocks have been asked to divert some fuel to units with low inventory.

"Now slowly the position is improving," he said, adding his ministry has asked the coal ministry to expedite supplies and has sought more wagons from Indian Railways.

Shinde, however, said return to normalcy will take "sometime".

India needs to significantly raise its power generation capacity to reduce peak hour power shortages and provide electricity to millions of rural households.

The power sector in Asia's third-largest economy is likely to import 55 million tonnes of coal in the fiscal year that began on April 1. Coal-fired plants account for 54.7% of 182,345 megawatt (MW) installed capacity in the country.

State-run NTPC Ltd has been getting sufficient supplies from Tuesday evening and gradually most units will start operating at normal rate, said a company official on Friday.

NTPC on Monday said generation at its several plants were hit by coal shortages. The company did not gave the extent of outages due to less fuel supply but government official said generation was down by about 4,000 MW.

NTPC, which is India's biggest power producer, consumes 164 million tonnes of coal a year to fire over two-thirds
of its about 35,000 MW installed capacity.

To ease the pains of power stations, the coal ministry has decided to offer power sector some of the fuel sold through e-auction this month besides asking Coal India to increase supply to the sector.

According to the government policy, 10% of the total available coal can be sold through e-auction, which usually yield higher realisation compared with annual contracts for Coal India.

"Only e-auction is not the solution," Shinde said.

Power-hungry India, where frequent black-outs are common, aims to halve its peak-hour power deficit of nearly 14% in two years.

The coal ministry on Friday said coal dispatches have increased to 169 wagons, with 148 being supplied to the power sector.

The dispatches are likely to further increase to around 180 wagons in the next few days, it said in a statement.

"The coal companies have been advised to ensure priority movement of coal to power stations," the statement added.