Coal India Ready To Meet Dry Fuel Demand From Power Sector

The public sector coal producer also expressed hope to supply 156 million tonnes of coal to the power sector during April-June quarter of FY24.
<div class="paragraphs"><p>A Coal India mining site. (Source: Company website)</p></div>
A Coal India mining site. (Source: Company website)

Amid early onset of summer and a pick-up in industrial demand for electricity, state-owned Coal India Ltd. on Tuesday said it is geared up to meet the demand of dry fuel from the power sector.

The public sector coal producer also expressed hope to supply 156 million tonnes of coal to the power sector during April-June quarter of FY24. This would be 25.6% of the enhanced annual dispatch target of 610 million tonnes slated for the sector in 2023-24.

"Coal India is optimistic about supplying 156 million tonnes of coal to power sector during April-June 2023 quarter amid concerns over spike in coal demand," the coal behemoth said.

Coal India which accounts for over 80% of domestic coal output, is a major supplier of dry fuel to the electricity generating plants.

Factors in favour of Coal India are a strong 68 million tonne coal stock build-up expected at its pitheads by the end of current fiscal, which as of Monday was 57.3 million tonne.

Also, the maharatna firm will scale up its production into a higher orbit maintaining the pace on the back of an unprecedented 700 million tonne output, which it is on course to achieve by the end of FY23.

"Even after despatching the planned coal to power utilities in the first quarter of FY24, Coal India is likely have a healthy 50 million tonne coal stock at its pitheads by June 2023 end," said a senior official of the company in a statement.

The state-owned coal mining behemoth is confident of meeting the enhanced 610 million tonne coal supply target to power sector in 2023-24. The target is 20 million tonne more than the initially projected 590 million tonne requirement by power sector.

Of the total 821 million tonne domestic coal demand projected for the power sector in 2023- 24, Coal India's target alone accounts for nearly three-quarters at 610 million tonnes.

By the end of the ongoing financial year it is estimated that there would be at least 115 million tonne of domestic coal available to the power plants, with 68 million tonne at Coal India's pitheads and 32 million tonne at plants' end.

Coal lying at private washeries, goods sheds, ports and captive mines account for around 12 million tonne. Rakes on run, that is coal in transit, normally make up three million tonne of coal.  Compared to last year's 92.7 million tonne, from the same sources, coal availability in the system would be 22.3 million tonne more.

"Even in the current financial year the initial target of 565 million tonne, to thermal plants, was increased to 569.5 million tonne by the power sector in May 2022. Taking the rejigged target into its stride, Coal India as of 13 March 2023, had already clocked 554 million tonne supply to power sector," the company said.

The company is well on its track to close FY23 with more than 585 million tonne despatch to power sector which represents an 8.3% jump over 540 million tonne of FY22.

"We are fully cognizant of the importance of meeting the demand surge from power sector and would do everything within our means to meet it," said the executive.

The power ministry had earlier directed all thermal plants using imported coal to operate with full capacity from March 16 to June 15 so as to avoid electricity shortage.

The direction under Section 11 of the Electricity Act came amid rising power demand due to higher-than-normal temperature in several parts of the country.

This order will remain valid for generation and supply of power from March 16, 2023 to June 15, 2023, stated a notice sent to 15 thermal plants that use imported coal.

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