BW Communities

Running Low On Coal

BW Online Bureau Nov 08, 2014

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[HAND TO MOUTH: Number of plants in India running low on coal India’s state-owned thermal power plants, taking care of 52 per cent of the country’s power production, are facing an unprecedented coal shortage that could bring some of them on the brink of a closure. For over a month now, about half of the 77 thermal power plants owned by the Centre and state governments have reported coal stocks lasting for less than a week against the required stocks of at least 2-3 weeks. That’s not all. Out of these 26 stations with less than a week’s stock, a third of the power stations have less than four days' stock, which is considered a critical situation. On 11 August, the plants that reported less than four days of coal stock add up to a phenomenal 33,000 MW capacity. While power ministry officials rule out shutdowns on account of fuel shortage, the managing director of Apgenco (the generating company of Andhra Pradesh), Ajay Jain, told BW that it was a “hand to mouth” existence. On some days, over 3,000 MW of Apgenco’s plants reported nil to two days’ stocks. The coal shortage is being attributed to a variety of factors that, according to the Central Electricity Authority, range from low receipt from the coal companies to demand for coal from the power station going beyond the coal-supply linkage committed to them. While the coal ministry denies shortages, a top NTPC official says that part of the problem is on account of rains that flooded some of the mines. He said that the situation should improve shortly. However, given the shortage, Andhra Pradesh has resorted to coal imports and things should ease in the state on account of imports. Jain says 150,000 tonnes of imported coal for AP is already tied up and tenders for another 100,000 tonnes are being finalised. However, this comes at a heavy price — imported coal costs double that of domestic coal. Depending on the location of the power plant, they are required to maintain coal stocks ranging from 15 to 30 days. Since some plants need huge quantities of coal to be transported over long distances, stocks at plant site ensure that in the event of any disruption of supplies, the power plant has enough reserves to keep running until the supplies are restored. Coal-based thermal stations form over half of the country’s installed capacity of slightly over 130,000 MW. The balance is spread between hydel plants, nuclear plants, liquid fuel plants and some imports from Bhutan. Coal India through its subsidiaries supply almost all the required coal for the power plants (barring some imports and lignite-based plants). With coal being the mainstay, what is alarming is that it is not the small plants that have reported low coal stocks on randomly-chosen dates between July and August. Surprisingly, it is the large strategic super thermal power stations (STPS) that have reported low coal stocks. On 10 August, Talcher STPS (3,000 MW) in Orissa reported stocks for one day. The 1,260-MW Tata Rao power station in Andhra Pradesh showed a coal stock of 4,000 tonnes (zero stock). The 2,600-MW Ramagundam thermal power plant again in Andhra that supplies power to all states in the southern region showed a coal stock of 8,000 tonnes. Adding more to the list, two critical STPS in the north — Rihand and Singrauli — both having a capacity of 2,000 MW each, showed they have one day and zero days of coal stock, respectively. The list goes on. bweditor (at) abp (dot) in (Buisnessworld Issue 26 Aug-01 Sep 2008)