Thursday, September 29, 2022

Power plants go easy on unloading to build coal supply for summers

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Kolkata: As coal stockpile stabilised, thermal power plants have started delaying coal unloading, industry sources said. According to Coal India Ltd (CIL) executives, some plants are trying to cut power supplies without formally asking for a cut, so that they do not face a problem when the demand surges during summers. However, they added, that unloading takes longer than normal when coal is already piled up in the storage space. A senior executive at Coal India said that unloading a rake normally takes two to five hours, depending on the level of mechanisation but some plants are taking as much as eight hours to release rakes.

Sources said that this is happening in power plants across Punjab, Haryana, Uttar Pradesh, Gujarat and Maharashtra. While some plants are running out of storage space, others are financially stressed and not in a position to stock coal.

Power plants find way to set off demurrage charges

Delays in releasing rakes incur demurrage charges, which means power plants have to pay this fee when the cargo exceeds the time allotted sitting at the terminal. The payment requires approval from the management. What power plants do is to set off demurrage charges by cutting down the cost of maintaining an inventory of smaller coal stock.

As coal availability has improved over time, both private and state-run plants have fuel enough to produce power for over a month. Some years back, some power plants had asked Coal India to reduce supplies but they had struggled to get increased supplies during summers. However, this year, they have formally asked Coal India to cut power supplies.

The Central Electricity Authority (CEA) data showed that 24 plants have stocks that will last more than 30 days. The average stock at a total of 126 plants is around 30 million tonnes, enough to last for 17 days.

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