urges states to import coal for blending with local grades to avert power outages this year
urges states to import coal for blending with local grades to avert power outages this year
India has allowed some state utilities to sell up to 25% of their allotted coal to other producers and has urged states to import coal for blending with local grades to avert power outages this year, a government statement said on Wednesday.
India is likely to face more power outages this year as utility coal stocks are at their lowest pre-summer level in at least nine years and power demand is expected to rise at its fastest rate in at least 38 years, officials and analysts say.
Tolling, or selling up to 25% of the coal allocated by state utilities, would give some power producers access to fuel from the coal mines and help increase power generation at a lower cost.
This would also reduce rail congestion by reducing the need for long-distance fuel transport.
“The toll would allow states to make the most of their connecting coal at the facilities closer to the mines, as it would be easier to transport electricity to distant states than coal,” the government statement said, citing Energy Minister RK Singh.
A sharp increase in power demand in India — the world’s second-largest coal producer with the world’s fourth-largest reserves — could mean local supplies may not be sufficient.
India has also asked utilities that rely on local coal to scramble to import up to 10% of their coal needs to blend with domestic grade to meet increased electricity demand.
“Government and company targets have been set and it has been strongly recommended to ensure the supply of coal for blending purposes before the start of the monsoon as domestic coal supplies will be impacted during the rainy season,” the statement said.
