Friday, June 24, 2022

Power crisis: Govt tells gencos to place orders for coal imports by May 31

RK Singh has asked several states to direct electricity generation companies (gencos) to ensure timely coal imports for blending purpose

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  • The ministry has clarified that if orders for coal imports are not placed by May 31, the defaulter gencos will have to increase their imports to the extent of 15 percent
  • In separate letters to Haryana, Uttar Pradesh, Karnataka and West Bengal, he has expressed concern that the tender process for coal import has either not started or not completed

New Delhi: Union Power Minister RK Singh has asked several states to direct electricity generation companies (gencos) to ensure timely coal imports for blending purpose so as to meet the requirements during the monsoon season. According to the Ministry of Power, directions have also been issued to all gencos (power generation companies) asking them to place import orders well in time.

The ministry has clarified that if orders for coal imports are not placed by May 31, and the imported fuel does not start arriving at power plants by June 15, the defaulter gencos will have to increase their imports to the extent of 15 percent.

Coal imports: Gencos must start fuel blending by June 15

“If blending with domestic coal is not started by June 15 then the domestic allocation of the concerned defaulter thermal power plants will be further reduced by 5 percent,” the ministry said in a letter written to state secretaries/principal secretaries and all gencos.

Keeping in view the less materialisation of coal supply from domestic sources as compared with the requirement to meet power demand, domestic coal will be allocated proportionately to all gencos based on likely availability from June 1 and the balance requirement will need to be met from imported coal for blending purpose and the coal production in captive coal mines, the Power Ministry said in the letter.

The ministry had earlier advised state gencos to import 10 percent of their coal requirement for blending purposes. States were advised to place orders by May 31, so that delivery of 50 percent quantity is ensured by June 30.

Haryana, UP, Karnataka, Bengal have not placed orders for coal imports

“The Minister of Power and New & Renewable Energy RK Singh has written to states that state gencos may be asked to take immediate steps to import coal for blending in order to meet their requirement during monsoon season. In separate letters to Haryana, Uttar Pradesh, Karnataka and West Bengal, he has expressed concern that the tender process for coal import has either not started or not completed in these states,” the Power Ministry said in a statement on Wednesday.

The minister has also said that state gencos may expeditiously lift the entire quantity of coal offered under RCR mode to build coal stock. In case of failure on either account, it would not be possible to give additional domestic coal to make up for the shortfall.

“If RCR (Rail-Cum-Road) allocation is not lifted, it will be allocated to other needy state gencos, and if the present state of affairs continue, it may lead to a shortage of coal in states during monsoon, adversely affecting the power supply situation in the states,” Singh said.

India has 88% of its total coal requirement

Due to higher demand and consumption of electricity, the share of coal-based generation has risen and the total coal consumption by power plants has also increased. Singh added that the materialisation of domestic coal is only about 88 percent of the total requirements.

In a separate statement, the Power Ministry informed that directions have also been issued to all gencos, including Independent Power Producers (IPPs), for timely import of coal for blending purposes.

“Not much blending has taken place in the months of April and May 2022. The power plants which have not started blending yet will ensure that they blend coal at the rate of 15 percent up to October 2022 and thereafter at the rate of 10 percent from November 2022 to March 2023,” the ministry said.

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