Coal Shortage: India Will Increase Output To 100 Million Tonnes; Plans To Reopen Closed Mines To Meet Demand

India plans to increase its coal output by 75-100 million tonnes in the next two-to-three years.

Emergency Law To Move Things Along

Coal secretary A K Jain said that it would do so by restarting closed mines.

Specifically more than 100 coal mines previously considered financially unsustainable.

In order to facilitate that, the government has invoked an emergency law which will help start generation at some idle power plants running on imported coal which are inactive due to financial stress or high international prices of coal.

Why So Many Plants Are Inactive

India has 17,600-MW imported coal plants, however, only 10,000 MW are operating due to the lack of compensation for the high imported coal prices.

Officials have also invoked Section 11 of the Electricity Act which will allow the plants to run.

Power ministry officials will work with financially stressed idle plants to make them functional.

A government committee will facilitate passing the higher costs of generation to customers.

Green Goals Forced To Take Backseat

The country is undergoing a heat wave-driven power crisis and is being forced to be more dependent on the fuel after months of low consumption.

Its coal dependence has environmental effects since it is the world’s third-biggest greenhouse gas emitter.

Coal usage for power generation is growing at the fastest pace in over a decade this year.

Coal Minister Pralhad Joshi said that although the government is pushing renewable sources of energy, coal is also going to be one of the major contributors in energy production.

Raising Output By 100 Mn-Tonnes

India is currently the world’s second largest producer, importer and consumer of coal after China.

It had produced 777.2 million tonnes during the year ended March 2022 and burnt over a billion tonnes.

It expects to increase output by up to 100 million tonnes in the next three years by reopening closed mines.

Coal India, the world’s largest coal miner, also plans to increase annual output to 1 billion tonnes by 2024, from 622.6 million tonnes currently.

It produces 80% of India’s domestic coal output.

Reasons Behind The Crisis

Its production had fallen for two straight years due to a lack of demand during the COVID-19 pandemic.

Now this demand is back following a recovery from the pandemic and an unforgiving heatwave boosting air conditioning use.

The power crisis is worsened by months of declining fuel inventories at power plants.

The situation is the worst it has been in more than six years, disrupting industrial activity and forcing acceleration of coal mining.

To meet this demand, the government is forcing utilities to step up imports and Coal India to ramp up production to address supply shortages.