States told to import 13.25 mt of coal

The power ministry has asked states to import 13.25 million tonnes of coal during the current financial year to meet the coal shortage in the economy.

How coal will be procured will be decided by the states, but they have been asked to ensure a steady inflow of the fuel throughout the year so that power plants do not face shortages.

National Thermal Power Corporation (NTPC), which has tied up imports of about 2.1 million tonnes via MMTC Ltd, has also been asked to increase the import level to 4 million tonnes in 2005-06.

Gail India has also been asked to organise LNG imports on a priority basis for gas-based power plants.

Full utilisation of the existing gas-based capacity will require an additional 15 mcmd of gas and can add about 3000 Mw generation to the system.

"NTPC's recently-commissioned 500 Mw unit at Talcher is not being run because there is no coal available. Four other NTPC plants "" Talcher, Simhadri, Kahalgaon and Farakka -- will continue to face shortages for some more months," said a power ministry official.

Coal shortage in the current fiscal is estimated at about 10 million tonnes and 20 power stations have coal supplies that will last them less than a week.

But, with new capacity expected to be added in the current and next fiscal, it is likely that the gap between demand and supply will increase to 30 million tonnes by end 2007.

"Maximum capacity addition is expected in the period between 2006-2008 and the coal situation can worsen," the official warned.

The shortfall in coal availability is because of delays in completing 12 projects of Coal India Ltd and its subsidiaries, which were to be developed for power plants. These projects were to be commissioned during the Tenth Plan period (2002-07).

In a number of cases, even sanctions have not been obtained. "The level of import will need to go up further in order to meet the demand from plants expected to be commissioned over the next two years.

Capacity addition is meaningless if it cannot be utilised," the official said.

This quantum of coal imports can be easily handled by the existing infrastructure in ports and by the railways.

But, if the level of coal imports had to be increased, there could be logistical problems in moving the commodity, he added.

The fuel shortage has meant that 18 bu of generation potential were lost in 2004-05. In the gas-based plants, the situation is worse. The plant load factor in these plants was less than 60 per cent in 2004-05.