Coal import for blending by power sector declined 12.31% in April-June period of FY25

New Delhi: Coal import for blending by the power sector declined 12.31 percent year-on-year in Q1 (April-June) of FY2024-25 even as power generation during the period went up by 11.3 percent in comparison to the last year. According to figures reviewed by PSU Watch, the power sector imported 5.70 MT coal in April-June period of 2024-25 for blending as opposed to 6.50 MT in the same period a year ago. “Coal production has went up by more than 10 percent in Q1, which has ensured increased availability of coal to the power sector, bringing down imports,” said a source on the condition of anonymity.

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The news is significant because the April-June period saw record-high temperatures, with June 2024 going down history as the hottest month in India on record, which, in turn, drove up power demand across the country. The total power generation in April-June period of 2024-25 was 4,20,582.12 GWH, up from 3,77,857.50 GWH recorded in the same period a year ago.

Decline in coal imports by power sector

India has the world’s fifth-largest coal reserves and is the world’s second-largest consumer of coal. With the government prioritising energy security, India is looking to mine out as much coal as required to meet the domestic demand from various sectors until the demand begins to dry out and the energy transition cycle kicks in. As a result of this policy thrust, India’s coal production has increased in the last few years, going up from 609.18 MT in 2014-15 to 997.23 MT in 2023-24. In 2024-25, India is aiming to produce 1.08 BT of coal, 874 MT out of which will be supplied to the power sector.

With India’s power demand growing exponentially, there is still a gap between coal supply and consumption in the power sector, which is being met through coal imports. However, the government has set out a target of reducing the import of all varieties of coal that can be substituted with domestic coal to zero by FY2025-26. With coal production from captive and commercial coal mines picking up pace, growing 32.70 percent in April-July period, the availability of coal is expected to improve further. “With sufficient coal available, the government is now in a comfortable place where coal can be made available for coal gasification as well after meeting the demand from the power sector. The next big challenge for us is to increase domestic coal availability for NRS (non-regulated sector) consumers,” said the government official quoted above.

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