“India Extends Imported Coal-Based Power Plant Operation Amid Soaring Demand and Shortages”

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The Ministry of Power extends the operation of imported coal-based power plants at full capacity until June 2024 due to increased electricity demand, insufficient domestic coal supply, and reduced hydropower generation, aiming to address power shortages.

Ministry of Power Extends Imported Coal-Based Power Plant Operation
Ministry of Power Extends Imported Coal-Based Power Plant Operation

In response to a substantial surge in electricity demand, a shortage of domestic coal, and decreased hydropower generation, India’s Ministry of Power has extended the emergency clause of the Electricity Act, 2003. This extension mandates that imported coal-based power plants must continue operating at their full capacity until June 30, 2024, rather than the initial deadline set for the end of the current month.

The decision comes as the government anticipates a peak power demand of 256.53 GW (256,530 MW) for the upcoming fiscal year (2024-25), following a record-breaking peak demand of 239.978 GW (239,978 MW) on September 1. However, this surge in electricity demand has also led to an alarming power shortage of 10.745 GW (10,745 MW) on the same day, prompting the government’s action.

“In view of the surge in electricity demand, inadequate supply of domestic coal and the reduced availability of hydro power, it is imperative that the availability of power from imported coal-based (ICB) generating stations is available to meet the demand. Therefore, after consultations with the Central Electricity Authority (CEA), the government has decided to extend the time period for Section 11 directive to imported coal-based generators, up to 30.06.2024,” read the official order dated October 23.

Section 11 of the Electricity Act, 2003, allows the government to instruct power-generating companies to maintain their output according to specific directions in extraordinary circumstances. The order also empowers the appropriate commission to offset any adverse financial impacts on generating companies.

This extension will affect at least 15 imported coal-based generators, including Coastal Gujarat Power Ltd, Adani Power Mundra Ltd, Essar Power Gujarat Ltd, JSW Ratnagiri Ltd., Tata Trombay Ltd., GSECL Sikka Ltd., IL&FS Tamilnadu Power Company Ltd, Muthiara-Coastal Energen, and Udupi Power.

Coal stocks at domestic thermal power plants have fallen below the comfort zone, from the standard 33-35 million tonnes (MT) maintained between March and August this year. As of October 23, coal stocks at domestic thermal power plants stood at 18.55 MT, with 75 out of 165 domestic coal-based thermal power plants in the country having critical coal stocks.

Government officials stress that coal-fired thermal power plants will play a crucial role in 2024-25, contributing up to 70-75 percent of the total energy mix during peak demand hours. The continued reliance on coal power is due to the absence of round-the-clock renewable energy sources, primarily because of the lack of energy storage systems in the country.

As India navigates its energy needs, the extension for imported coal-based power plants aims to ensure a consistent supply of electricity and address power shortages during peak demand periods. This development will be closely watched as the nation works to balance energy supply and demand.

Sources By Agencies

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