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The parliamentary standing committee on energy has said that the union ministries of power and coal should ensure optimum utilization of locally-produced coal through effective collaboration so that imports can be phased out over time.

In its 26th report, the panel chaired by member of parliament Rajiv Ranjan Singh, said efforts made by both ministries led to a 56% drop in coal imports for blending in FY21, but higher international prices hit imported coal-based power plants. This led to increased demand for domestic coal, and consequently reduced domestic coal stocks at power plants, it said in a report.

The recommendations on phasing out imports tracks India’s emergence out of a severe coal crisis during April and May when the country was in the midst of an unprecedented heatwave leading to a surge in power demand. This forced the government to float tenders for coal imports.

The report said the Central Electricity Authority and the power ministry had advised power generating companies to import to replenish critical coal stocks at power plants. “While the committee urges the ministry to learn appropriate lessons from the 2021 episode, it reiterates its recommendation that the ministry of power and the ministry of coal should collaborate effectively on this issue and make concerted efforts for optimum utilization of domestic coal reserves keeping in view the basic objective of doing away with the import of coal in a phased manner."

The committee said that it should be apprised of the strategy being followed in this regard and the outcome thereof.

On 18 July, Mint reported that the Centre was trying to convince imported coal-based power plants to modify their infrastructure to use domestic coal.

The panel said the quality of indigenous coal can be enhanced and design of boilers at power plants can be modified to enable them to run on domestic coal. There was a need for formulating a clear-cut policy that is in consonance with the idea of ‘Atmanirbhar Bharat’, besides helping achieve energy security and provide affordable power for the common man, it added.

In view of India’s energy security targets, the emphasis on higher production of coal has grown. On Wednesday, the ministry reported 26.22% growth in domestic coal production in April-July to 265.65 million tonnes.

According to the standing committee report, India imported 45.5 million tonnes of coal in FY21, down from 69.2 million tonnes in FY20. In April-September 2021, imports stood at 16.3 million tonnes. On 22 July, Mint reported that India has firmed up a plan to import around 76 million tonnes of coal to help plug a shortfall at power plants for FY23.

On delay in operationalizing coal blocks, the committee expressed disappointment on the slow progress despite the Central Electricity Authority monitoring the operationalization of coal blocks for the power sector. “Since most issues are pending with state governments, the committee now desires that the matter should be taken up at the highest level to persuade concerned state governments to resolve issues so that excavation work can start without any further delay. The committee would like to be apprised of the outcomes achieved in this regard at the time of furnishing the action-taken statement."

Meanwhile, the parliamentary standing committee on coal, mines and steel has asked the government to prepare an action plan to incentivize and promote the domestic copper industry and reduce dependency on imported refined copper and copper scrap, as consumption is expected to rise from the current level of 0.6 kg to 1 kg per capita per year. It has recommended the mines ministry to collaborate with the finance and commerce ministries to offer more incentives to the copper industry for capacity addition under the ‘Make in India’ campaign.

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