Coal crisis, the three most industrialized countries plan to import 10.5 million tonnes of coal as authorities help prevent massive blackouts.
Maharashtra, Gujarat and Tamil Nadu plans to import coal to fulfill rising power need, coal crisis in India is becoming a major problem.
India’s three most industrialized states plan to import 10.5 million tonnes of coal over the next few months as officials struggle to prevent massive blackouts that could push global coal prices to record highs.
The size of purchases and the decision to abandon plans to cut coal imports underscore the seriousness of India’s fuel crisis. Utilities’ coal stocks are at their lowest level in nine years and electricity demand is growing at the fastest rate in at least 38 years.
Maharashtra aims to import 8 million tonnes for “blending” and Gujarat will order 1 million tonnes next week, state energy officials told the federal government on April 13, according to minutes reviewed by Reuters on April 13. said.
Tamil Nadu State Public Utilities Chairman intends to import 20 per cent of the state’s coal needs, adding that they have already placed import orders for 1.5 million tonnes.
These three states are among the largest consumers of electricity in India and will account for nearly a third of India’s electricity demand in 2021.
The specifics of the state’s revenue plans have not been reported previously. Projected cumulative revenues from only the three states will exceed the annual revenues of state utilities for blending for at least six years.
World prices already approaching record highs have been further pushed up by fears of supply cuts following the European Commission’s decision to ban coal imports from Russia after India, the world’s second-largest coal importer, invaded Ukraine can elevate.
Indonesia is likely to be a major beneficiary of India’s purchasing craze, but these producers are already under pressure from the recent surge in demand.
Russia is also likely to supply, but prices are already high and buyers are likely to seek discounts, both traders said.
Government of India on coal crisis:
The central government has also asked the states of Karnataka, Uttar Pradesh, Madhya Pradesh, Punjab and Haryana to import a total of 10 million tonnes of coal.
Punjab has promised to import 625,000 tonnes, but other states have not provided detailed plans, the minutes said.
Maharashtra’s estimated 8 million tonnes of coal imports are expected to be delivered on 8 May, in addition to the 2 million tonnes already ordered. It has mixed requirements but has since proposed increasing revenues by 10% of the amount needed to meet growing electricity demand last week.
Many Indian states, including Andra pradesh in the south, Maharashtra in the west, Haryana in the north, Punjab, and Rajasthan, are already facing power outages.
Tamilnadu utilities average less than two days of coal vehicle inventory, while Maharashtra and Gujarat power plants average about five days. Federal guidelines recommend that the state be in stock for at least 24 days.
Authorities also enforce urgent provisions in national electricity law to allow currently idle power plants designed to operate on imported coal to pass on higher costs to distribution companies.
The minutes of the meeting show that this move will facilitate the operation of factories operated by Adani Power, Essar Power, CLP India and IL & FS Tamil Nadu, whose electricity production has been significantly reduced due to soaring global prices.
Lets hope for the best that the coal crisis will be managed soon.