Indian Govt sets coal import targets and timeline amid rising power woes
If the target timelines are followed, then in the next five months import of coal for blending in India will be much more than total coal imported during the past six years
The Indian government has asked state and private sector utilities to import 19 million tons of coal from overseas by the end of June. This is in order to help secure supplies in an expensive market, as power outages have become more common.
The move by the world’s second largest coal importer could put pressure on the global prices of coal, as utilities rush to avoid the electricity crisis. A relentless heat wave pushed April’s electricity demand to record highs, causing the worst electricity crisis in more than six years, forcing India to return to a policy of reducing coal imports.
If the timelines are followed, the states and private utilities will import more coal to blend with domestic coal in the next five months than they have imported in the past six years.
According to the power ministry’s letter given to media agencies, the state government-owned utilities to import over 22 million tonnes of coal while the and private power plants have been asked to import 15.94 million tonnes, by the central government.
All utilities have been asked to ensure the delivery of 50 per cent of the allocated quantity by June 30, 2022 by the Power Ministry. It further noted that the utilities should make sure that the delivery of another 40 per cent is completed by end-August and the remaining 10 per cent by the end of October, 2022.
Since the year ending March 2017, state government-run utilities have imported the maximum of 7.1 million tonnes while the private power companies have imported the maximum of 13.1 million tonnes of coal for blending.
Though, utilities are not required to comply with central government directives, but in case of failing to import the proposed quantity, the states are sure to face power outages amid growing demand for electricity, stated the government officials. The government demands that states and private companies import coal and provide uninterrupted power supplies to the respective states.
The letter from the Power Ministry notes that it is necessary that awards for importing coal for blending purposes are finalized by May 31, 2022, in order to ensure that adequate coal stocks are available in power plants before the onset of the monsoon season.
The letter has also directed several private companies, including Adani Power, Tata Power, Reliance Power, Jindal Steel and Power, Torrent Power, and Sembcorp, on the coal import targets.
The letter from the ministry of power also noted that all the state power generation companies and independent power plants must submit weekly management information system reports to the Central Electricity Authority (CEA) and the Ministry of Power about the port-wise imports of coal as well as report of arrival and delivery of imported coal plant wise.
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