Coal India to import for first time in years as power shortages loom



State-run Coal India, the world’s largest coal miner, will import the fuel for use by utilities, a power ministry letter seen by Reuters showed on Saturday, as shortages raise concerns about renewed power outages.


It would be the first time since 2015 that has imported the fuel, highlighting efforts by state and federal officials to stock up to avoid a repeat of April, when India faced its worst power cuts in more than six years.





would import coal for blending on government-to-government (G2G) basis and supply … to thermal power plants of state generators and independent power producers (IPPs),” the federal Power Ministry said in the letter dated May 28.


The letter was sent to all utilities, top Central and state energy officials including the federal coal secretary and the chairman of .


India is expected to face a wider coal shortage during the third quarter of 2022 due to expectations of higher demand, stoking fears of widespread power outages.


The power ministry said in the letter the decision was taken after nearly all states suggested that multiple coal import tenders by states would lead to a confusion and sought centralised procurement through Coal India.


India stepped up pressure on utilities to increase imports to blend with local coal in recent days, warning of cuts to the supply of domestically mined coal if power plants did not build up coal inventories through imports.


But the power ministry on Saturday asked states to suspend tenders that are “under process”.


“The tenders under process by state generators and IPPs for importing coal for blending may be kept in abeyance to await the price discovery by Coal India through G2G route, so as to procure coal at least possible rates,” the ministry said.


Coal inventories at power plants have declined by about 13% since April to the lowest pre-summer levels in years.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor





Source link

Leave a Comment