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Coal India Has Sufficient Buffer Stock For Non-Power Sector: Govt

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Coal India is currently supplying around 3.4 lakh tonnes of coal per day to the non-power sector, says govt

State-owned CIL on Saturday said it is currently supplying around 3.4 lakh tonnes of coal per day to non-power sector which is the company’s average supply to this segment and stressed that it has sufficient buffer stock to increase supply to the sector.

The development assumes significance in the wake of reports of captive power plants in various sectors including steel and aluminium facing fuel shortages.

The non-power sector (NPS) imports around 170 million tonnes (MT) of coal in any given fiscal for blending with domestic coal. But in FY’22 the spiralling international coal prices proved to be a hindrance for importing requisite quantity, giving rise to scarcity of coal at their end.

Coal India’s “despatch to NPS during April-January FY’22 at 101.7 million tonnes was up by 8.2 per cent compared to 94 MTs in corresponding period of a standard pandemic free FY20. For comparable period of even FY19, when CIL recorded the highest ever total coal despatch since its inception, supply to NPS sector grew by 11 percent over 91.5 MTs”, the mahratana firm said.

Growth in supplies to non-power sector customers was at a higher rate than the supplies to the power sector during this period.

In dispatch during the April-January period to NPS segment at 105 MT was higher by a little over 3 MT compared to same period of FY’22. The reasons for increased despatch during the Covid ravaged year were several.

As power sector regulated coal intake for major part of FY’21, due to demand disruption caused by Covid, CIL scaled up supplies to NPS segment. Further, NPS customers also opted to lift higher volumes of coal as CIL’s e-auction sales were capped at notified price for the first half of FY’21.

With more than 37 million tonnes of coal at its pitheads, the PSU aims to further step up supplies to this sector.

“CIL has sufficient buffer stock to increase supply to non-power sector. Coal availability is not a problem, the company said.

CIL said FY’22 has witnessed an unprecedented surge in power generation, the growth rate being the highest in a decade, necessitating the need to meet the power sector’s coal demand on a national priority.

Riding on robust economic recovery, total coal-based power generation till January of the fiscal in progress grew by 11.2 per cent on year-on-year comparison. Whereas domestic coal-based generation was up by 17 per cent during this period. Bulk of the coal supply to power sector was met by CIL on priority.

In a sharp contrast, power generation by 14 imported coal-based power plants was down by 48 per cent during April-January 2021-22. Meeting the resultant generation gap fell on domestic coal-based generators requiring enhanced indigenous coal supply. CIL supplied to the tune of around 20 MT of this additional demand. In other words, imports were curtailed to that extent.

Despite prioritisation of coal to the power sector and facing other challenges, CIL at 101.7 MT till January FY’22 supplied 97 per cent of same period last year’s quantity to NPS customers.

Coal India accounts for over 80 per cent of domestic coal production.

(PTI)

Coal

Supply Of Coal By CIL To Non-Power Sector Suspended Temporarily

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On being asked about the development, a CIL official said, “This is only a temporary prioritization, in the interest of the nation, to tide over the low coal stock situation at the stressed power plants and scale-up supplies to them.” The company, the official said, is increasing its production and offtake steadily.

The supply of coal by Coal India (CIL) to the non-power sector has been kept suspended temporarily amid electricity generating plants in the country grappling with coal shortages. “Supplies to non-power sector plants have been kept suspended till further information,” according to a recent letter of Coal India’s arm South Eastern Coalfields Limited (SECL) seen by PTI. 

On being asked about the development, a CIL official said, “This is only a temporary prioritisation, in the interest of the nation, to tide over the low coal stock situation at the stressed power plants and scale-up supplies to them.” The company, the official said, is increasing its production and offtake steadily.

For the past four days, supplies to the power sector are consistently at 1.61 million tonne (MT) per day. Once the situation stabilises, expectedly within a short time, and stock at coal fired plants attains comfort level, other sectors will be brought back to their regular supply norm.

In fact, supplies to non-power sector during H1 of the current fiscal at a little over 62 million tonne posted 10 percent growth over last year same period and 11 percent compared to a COVID-free April-September 2019. Even since the demand for coal reached a higher pitch from power sector from August supplies to non-regulated sector (NRS) consumers was close to 18 MT during August-September clocking a growth of 37 percent compared to pandemic free August-September 2019.

Owing to the skyrocketing coal prices at international markets all the consumers have been vying for domestic coal, hiking up the demand. Instead of restricting coal intake, had the power utilities stocked up coal from October of last year till February this year, as was repeatedly requested by coal companies of CIL stock position at the plants would have been better, the official said.

Coal Minister Pralhad Joshi had on Wednesday said cumulative coal supplies to thermal power plants crossed 2 million tonne on Tuesday and dispatch of the dry fuel is being enhanced to the plants. “Happy to share that cumulative coal supplies to thermal power plants from all sources including @CoalIndiaHQ recorded more than 2 million tonne yesterday. We are increasing coal dispatch to power plants further to ensure sufficient coal stocks at power plants,” Joshi had said in a tweet.

According to a Coal India official, supplies to power stations have already touched 1.62 million tonne a day in the past two days, with total offtake rising to 1.88 million tonne per day, compared with the month’s average of 1.75 million tonne.

The company also ramped up its output to 1.6 million tonne a day in the past two days and CIL expects to raise production after Dussehra, when workers are back from holidays and the attendance picks up, the official said. Joshi had on Tuesday said the government is making full efforts to meet the coal demand of power producers and stressed that steps are being taken to soon ramp up the dry-fuel supply to 2 million tonne per day, from the current overall dispatch of 1.95 million tonne per day.

The minister had assured all stakeholders of the coal supply required for power generation. CIL had earlier said it is marshalling all its efforts to bridge the demand-supply gap to the extent possible.

Coal India accounts for over 80 percent of domestic coal output.

(PTI)