CIL says supply to non-power industries at average level

Coal India on Saturday said it is currently supplying around 3.4 Lakh tonnes of coal per day to non-power sector (NPS) which is the company’s average supply to this segment.

With more than 37 million tonnes (MTs) of coal at its pitheads CIL aims to further step up supplies to this sector, an executive said.

Earlier, non-power industries sought Prime Minister Narendra Modi’s intervention to address coal shortage in their captive power plants. In a joint representation, eight industry associations including of fertiliser, paper, textile, aluminium and sponge iron have submitted that the persisting coal crisis is hurting power-intensive plants and small and medium enterprises by forcing them to operate at reduced capacities amid a looming risk of plant closures.

Coal India, however, said despatch to non-power industries during April-January FY22 at 101.7 million tonnes (MTs) was up by 8.2% compared to 94 MTs in corresponding period of a standard pandemic free FY20. For comparable period of FY19, when CIL recorded the highest ever total coal despatch since its inception, supply to NPS sector grew by 11% over 91.5 MTs.

He said growth in supplies to non-power customers was at a higher rate than the supplies to the power sector during this period.

In April’20-January 21 despatch to non-power segment at 105 MTs was higher by a little over 3 MTs compared to same period of FY’22.

As power sector regulated coal intake for major part of FY’21, due to demand disruption caused by Covid, CIL scaled up supplies to non-power segment. These customers opted to lift higher volumes of coal as CIL‘s e-auction sales were capped at notified price for the first half of FY 2021, he said.

The non-power industries imports around 170 MTs of coal in any given fiscal for blending with domestic coal. But in FY’22 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 non-power sector. Coal availability is not a problem” the executive said.

FY’22 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. The total coal-based power generation till January’22 of the fiscal in progress grew by 11.2% on year-on-year comparison. Whereas domestic coal-based generation was up by 17% during this period.

Power generation by 14 imported coal-based power plants was down by 48% during April-January 2021-22. CIL supplied to the tune of around 20 MTs of this additional demand.

Despite prioritisation of coal to power sector and facing other challenges, CIL at 101.7 MTs till January FY’22 supplied 97% of same period last year’s quantity to non-power customers, he said.

The representation by non-power industries stated that a curtailment in coal supply via rail and road modes in recent weeks has pushed non-power coal consumers to catastrophic conditions.

The requirement of non-regulated sub-sectors is around 25-30% of the total coal production, with around half a million tonnes needed daily for sustainable operations. However, they have been receiving less than 300,000 tonnes a day, which is leading to derailment of operations and rampant losses, it said.