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Indian power plants on full throttle amidst global coal price crash

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In Short:

China’s oversupply of coal has led to a decrease in global coal prices, benefiting Indian power plants. Electricity generation has increased in India, reducing the risk of outages during the high-demand summer months. The government has ensured adequate coal stocks at power plants, allowing them to operate at full capacity. This is a welcome relief for consumers during the hot summer.

NEW DELHI : Hey there, folks! Feeling the heat this summer? Well, here’s some good news – you might experience fewer electricity outages thanks to China.

Powerful Impact of Coal Prices

Electricity generation by Indian power plants fired by imported coal has nearly doubled in the first three weeks of April this year thanks to a 30% decline in global coal prices.

This drop in prices is a result of an oversupply in China, the world’s largest coal producer, making it easier for Indian power plants to access this nonrenewable energy source.

With India expecting its highest ever power demand this year, coal prices easing has come at the right time. The Central Electricity Authority estimates peak power demand may reach 260 GW by September.

“Coal prices have eased in the past year and power plants in Maharashtra and Gujarat are importing coal amid the falling prices,” said Jabal Patel, proprietor of Giant Asia, a Gujarat-based coal supplier.

Boost in Power Generation

Thermal or coal-based power plants make up about 55% of India’s total electricity production. Plants using imported coal are crucial for coastal states far from domestic coal mines.

Between December and February, thermal coal imports into India increased to 50.6 million tonnes from 36.6 million tonnes.

Indian power plants relying on imported coal typically reduce operations when prices are high. However, the recent fall in coal prices has allowed them to operate at maximum capacity.

The government has also directed these plants to operate at full capacity to meet the country’s electricity demand.

Adequate Supplies

Coal stocks at power plants in India are at 46.88 million tonnes, enough for about 19 days of operation. This is higher than the 33.70 million tonnes available in the same period last year.

Total coal stock in India currently stands at 154.37 million tonnes, 29.4% higher than the previous year.

Amrit Lal Meena, secretary to the Union ministry of coal, assured that there would not be any major depletion of coal stock and it would be adequate to meet the rising demand.

So, here’s to fewer power outages and a more reliable electricity supply, all thanks to the changing global coal prices!

Published: 29 Apr 2024, 03:52 PM IST

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