Amid coal supply crunch, govt reworks allocation plan
While Thursday’s demand was not even the highest the country has ever seen, at least 3,000 MW of power demand could not be met on the same day
Summers have just begun and India is already staring at yet another coal crisis as power demand continues to soar with India recording a peak demand of 197,283 MW on Thursday.
While Thursday’s demand was not even the highest the country has ever seen, at least 3,000 MW of power demand could not be met on the same day, primarily owing to plants either being shut or running below their installed capacity due to coal shortage.
Taking note of the imminent crisis, the power ministry on Friday changed the methodology of how coal allocated to states could be used by private independent power generating stations (IPPs). It also tweaked the timeline of the bidding process, in an attempt to ease coal availability at power plants going ahead.
On Wednesday, the power demand that remained unmet was as high as 7,681 MW. If we compare the peak power demand that was met on April 21 this year with that on the same date last year, there is a 15.5% increase in demand. On April 21, 2021, the peak power demand was 170,796 MW, while the shortfall was merely 358 MW.
States such as Andhra Pradesh, Maharashtra, Gujarat, Punjab, Jharkhand, and Haryana have already started raising alarm over low coal stocks in their thermal power stations which could lead to electricity outages. Some of them have already started facing planned power cuts to rationalise the demand.
“In line with various measures being taken in view of increasing power demand, the power ministry has amended the methodology for use of coal (allocated to states) by IPPs. Larger visibility has been given to the power plants by extending the period of supply of coal from 1 year to 3 years. The Ministry has further made amendments in the timeline of the bidding process which has been reduced from 67 days to 37 days. The measures have been taken for ensuring more efficient utilisation of domestic coal,” read a statement issued by the power ministry on Friday evening.
Data from the Central Electricity Authority (CEA) showed that as on Thursday (April 21), as many as 89 of 150 power plants running on domestic coal had critically low coal levels. The reasons cited in the remarks stated it was mostly due to low supply from Coal India Limited and lack of rakes to transport them.
The highest ever peak power demand was 200,570 MW at 12:01 hours on July 7, 2021. This year, that record is set to be broken with the ministry projecting a peak electricity demand of 215,000 MW.
“The Government has taken these measures in order to optimally utilise the railway infrastructure for maximum transportation of coal to the power plants. The ministry said that this would enable States to optimally utilize their linkage coal in the plants nearer to the mines as it would be easier to transmit electricity instead of coal transport to far off States,” the ministry further stated.
India has been reeling under a coal crisis which aggravated between October and November last year as well, owing to extended monsoons and an increase in the demand for domestic coal over expensive imported coal. The crisis triggered power supply issues in several states and union territories such as Delhi, Maharashtra and Gujarat where distribution companies (discoms) had to resort to scheduled power cuts.