BackCaptive power projects now seek restoration of coal supplies
‘CPP industry consumers are struggling to get uninterrupted coal supplies for continued operations. CPP are getting overall coal supplies at just 40% to 50% levels’
PremiumNew Delhi: While the fuel stocks at coal-powered power projects are being ramped up, it's the captive power projects who are now pitching for restoration of coal supplies.
In a communication to union power secretary, Indian Captive Power Producers Association (ICPPA) has said, “CPP industry consumers are struggling to get uninterrupted coal supplies for continued operations. CPP are getting overall coal supplies at just 40% to 50% levels."
This comes in the backdrop of fuel stock at 136 power projects totalling 166.109 giga watt (GW) run on coal being built up after depleting to 7.23 million tonnes (mt) on 8 October. India’s power plants burn around 1.85-1.87 mt of coal every day to generate electricity.
“Out of total 78,000 MW installed CPP capacity in the country, around 56,000 MW (i.e. 70%) CPPs are thermal-coal based, which require ~200 million MT coal per annum. Huge investments of $30 billion have been made for setting up these CPPs and infrastructure and generate 15 lakh direct and in-direct employment," the communication added.
The depleted fuel stocks at power plants had led to concerns about a possible electricity shortage. This assumes significance given that coal fuelled power projects totalling 202.22 gigawatt (GW) remain the mainstay of India’s power generation and account for more than half of India’s power generation capacity.
With the government diverting available coal through “Priority Coal Supplies" to thermal power projects, “Significant part of the Linkage-FSA & Auctioned Coal Rakes meant for CPP & industries have been either stopped or significantly curtailed for diversion to these IPPs. Even coal movement by road mode to CPP industries has been affected," the communication said.
India has the world’s fourth-largest reserves and is the second-largest producer of coal. While Coal India Ltd (CIL) annual production target is 660 mt for the current financial year, the coal off take is expected to be 740 mt.
“Instead of using own-generated power, many CPP industries were forced to buy Grid- Power, which was produced by IPPs using coal diverted from CPPs," the communication said and added, “During each 3-4 year’s cycle, Captive Power Producers have to suffer heavily for one to two years because their Linkage Coal rakes are diverted to other power producers for stock- building; CIL stops or reduces Spot / forward auctions; towards the “end of each Crisis-Period" railways dump 1-1.5 yrs‟ inventory on CPP in 1-3 months, forcing CPP to loose Linkage Qty."
State-run CIL plans to invest Rs19,650 crore by FY24 to increase coal transportation capacity by an additional 330 million tonne (mt) through rail by constructing rail links and setting up joint ventures.
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