New Delhi: Coal inventories at India’s thermal power stations plunged nearly 42 percent on-year to 29 million tonnes in August 2026, down from 50 million tonnes a year earlier, dragging fuel cover down to just nine days, according to a recent report by research agency Crisil.
The report added that this marks the thinnest stockpile cover recorded in the last 34 months since November 2023, driven by a sharp 13 percent spike in coal-fired power generation amid intense electricity demand.
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A sweltering summer followed by an erratic southwest monsoon, where cumulative rainfall between June and August lagged 13 percent below the long-period average, pushed overall electricity demand up by 9.5 percent during the April–August period.
While renewable power generation expanded by 20.7 percent, its intermittent profile meant coal-fired units shouldered the bulk of baseload requirements. Consequently, domestic thermal plants consumed 395 million tonne of coal over the five months, an 8 percent increase on-year.
The sudden drawdown left 51 out of 190 thermal power stations grappling with critically depleted stockpiles in August, compared to 20 plants a year ago. As percentral Electricity Authority norms, stock is deemed critical when it drops 25 percent below normative thresholds.
The strain was acute across inland northern and southern grids: 72 percent of coal capacity in Rajasthan, 69 percent in Madhya Pradesh, and 60 percent in Andhra Pradesh slipped into the critical zone.
In contrast, pithead-proximate states such as West Bengal and Odisha fared significantly better, with critical capacities contained at 6 percent and 10 percent, respectively.
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Crisil said that the crunch stems from transportation bottlenecks rather than underlying fuel scarcity. Extended monsoon showers in the eastern mining belt hampered pithead evacuations.
Sehul Bhatt, Director at Crisil Intelligence, noted, “India's pithead inventories moderated sharply from a peak of 157 MT in early March 2026 to 76 MT in August 2026, reflecting the normalisation of elevated stocks.”
“Current levels remain broadly aligned with the average of 76.1 MT recorded across August 2024 and 2025. This indicates that despite the significant drawdown, coal availability is adequate and there is no material supply-side stress,” Bhatt added.
Coal India permitted plants under fuel supply agreements to lift supplementary volumes by road starting September 7.
“The recent decline in power plant stocks appears to be a temporary logistical issue rather than a sign of any structural supply constraint,” said Surbhi Kaushal, Associate Director at Crisil Intelligence.
She expects electricity demand and dispatches to expand between 6 and 7 percent in the second half of the fiscal year.
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