Sunday, May 22, 2022

Coal India says will step-up coal supply to starved non-power sector further

Must read

  • CIL’s despatch to the non-power sector during April-January period of FY22 at 101.7 MT was up by 8.2 percent compared to 94 MT in the corresponding period of FY20
  • Despite prioritisation of coal supplies to the power sector, CIL, at 101.7 MT till January FY22, supplied 97 percent of the quantity supplied to NPS customers last year, said CIL

New Delhi: Coal India Limited (CIL) is currently supplying around 3.4 lakh tonnes of coal per day to the non-power sector (NPS), which is the company’s average supply to this segment, said CIL in a statement on Saturday. With more than 37 million tonnes (MT) of coal at its pitheads, CIL aims to further step up supplies to this sector. CIL’s despatch to the non-power sector during April-January period of FY22 at 101.7 MT was up by 8.2 percent compared to 94 MT in the corresponding period of a standard pandemic-free FY20. 

In comparison to FY19, when CIL recorded the highest-ever total coal despatch since its inception, supply to the NPS sector for the current year has went up by 11 percent. In the corresponding period of FY19, CIL’s coal supplies to the non-power sector were at 91.5 MT. Growth in coal supplies to non-power sector customers grew at a higher rate than the supplies to the power sector during this period. 

‘CIL has sufficient stock to increase coal supply to non-power sector’

In April 2020-January 2021, despatch to the NPS segment at 105 MT was higher by a little over 3 MT compared to same period of FY22. The reasons for increased despatch during the Covid ravaged year were several. As power sector regulated coal intake for major part of FY21, due to demand disruption caused by Covid, CIL scaled up supplies to the NPS segment. Further, NPS customers also opted to lift higher volumes of coal as CIL’s e-auction sales were capped at notified price for the first half of FY21.

The non-power sector imports around 170 MT of coal in any given fiscal for blending with domestic coal. But in FY22, the spiralling international coal prices proved to be a hindrance for importing requisite quantity, giving rise to scarcity of coal at their end. “CIL has sufficient buffer stock to increase supply to the non-power sector.  Coal availability is not a problem,” said a senior executive of the company. 

FY22 witnessed unprecedented surge in power generation

“FY22 has witnessed an unprecedented surge in power generation, the growth rate being the highest in a decade, necessitating the need to meet the power sector’s coal demand on a national priority. Riding on a robust economic recovery, total coal-based power generation till January 2022 of the fiscal in progress grew by 11.2 percent on year-on-year comparison. Whereas domestic coal-based generation was up by 17 percent during this period. Bulk of the coal supply to the power sector was met by CIL on priority,” said CIL in the statement.

In a sharp contrast, power generation by 14 imported coal-based power plants was down by 48 percent during April-January 2021-22. Meeting the resultant generation gap fell on domestic coal-based generators requiring enhanced indigenous coal supply. CIL supplied to the tune of around 20 MT of this additional demand. In other words, imports were curtailed to that extent.

Despite prioritisation of coal supplies to the power sector and other challenges, CIL, at 101.7 MT till January FY22, supplied 97 percent of the quantity supplied to NPS customers last year during the same period, said CIL.

Backdrop

The statement comes as non-power sector has been sending repeated SOS to the Central government, urging the Centre to increase the allocation of coal to the power sector. Bodies representing the non-power sector, like the Indian Captive Power Producers’ Association (ICPPA), the Federation of Indian Mineral Industries (FIMI), among others, have made repeated appeals to the government for regularisation of coal supplies to the sector, citing the precarious position of coal stock at their ends. However, the government has asked Coal India Ltd (CIL), India’s largest coal miner, to prioritise coal supplies to the power sector until sufficient coal stock has been built up at thermal power plants.

Recently, Congress’ trade union wing INTUC held a protest in Chhattisgarh’s Bilaspur district to protest against low coal supplies to the non-power sector. INTUC’s National General Secretary Sanjay Kumar Singh had said then that if the non-power sector’s coal requirement is 100 percent, it is receiving only 20 percent supplies from coal miners.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Google News. Click here to follow. Also, join PSU Watch Channel in your Telegram. You may also follow us on Twitter here and stay updated.)

- Advertisement -

More articles

- Advertisement -

Latest News