PowerMin expects 20 million tonnes domestic coal shortfall in April-June

Ahead of peak electricity demand season, the power ministry has informed power generators a shortfall of 20 million tonnes (mt) in the domestic coal supply during the first quarter of financial year 2023-24. In a presentation to all the stakeholders, the ministry has indicated a shortfall of domestic coal and railway rakes in the coming months. Business Standard has reviewed a copy of the presentation.

According to the data shared by the ministry, during April-June 2023, the total coal requirement across the country would stand at 222 mt to meet the anticipated record high power demand of 229 gigawatt (Gw) this summer. The likely availability of domestic coal is expected to be around 201 mt. An earlier projection by the coal ministry had pegged the coal supply to be around 205 mt during Q1.

With the central power stations, of which NTPC is the largest supplier, there would be a shortfall of close to 6 mt during Q1. State-ow­ned power plants will see a shortfall of 8.4 mt during the same period. The worst hit are the privately owned ones that would have 20.8 mt of domestic coal.

With regards to railways rakes, against the demand of 428 rakes per day, the ministry is expecting 418 rakes per day at the national level during Q1. Senior power ministry officials said, states have been apprised of the gap in requirement and availability of domestic coal and they should plan in advance to bridge the gap.

Ideally, there should be no or minimal shortfall of domestic coal as more the share of costlier imported coal, more the energy charges that will be passed on to the consumers in the final power tariff. 

Charing a meeting with all stakeholders on Thursday, Union Power Minister R K Singh had urged the state-owned power distribution companies to not resort to “gratuitous load shedding” during the summer season. The discoms have also been directed under Section 11 of the Electricity Act with effect from March 16 to ensure timely payment to the generating companies, failing which the genco will sell the power in exchanges.

The Centre has started early preparations for the summer months to avoid the coal demand supply crisis like last year. This also includes increasing share of imported coal in the supply chain.

In January, the power ministry had asked all gencos to import coal up to 6 per cent of their total requirement. According to the Electricity (Amendment) Rules, 2022, the power ministry has allowed pass-through of additional coal cost on the final consumer tariff.  According to data accessed by Business Standard, 4.26 mt of imported coal tenders have been placed by five states — Haryana, Punjab, Maharashtra, Rajasthan, and Tamil Nadu.

The power ministry is also pinning hopes on new coal-based capacity totalling 2.9 Gw coming online by end of this month.