Thermal Power Plants Running Out Of Coal: Here's How Government Plans To Overcome The Disruption And Shortage

Over half of the country’s thermal power plants are running low on coal, forcing some of them to stop operations. As of 28 August, for which the latest data is available, out of 134 thermal power plants which are monitored by the Central Electricity Authority (CEA), 69 power plants have critical stock of coal (supplies for less than a week).

This translates into plants with total capacity of 87,000 MW, which is more than half of the total capacity of 168,000 MW. This figure excludes the number of thermal power plants having low supply of coal due to non-payment of dues.

This has led to power supply disruptions in various states. According to the power supply report of the Power System Operation Corporation Limited (POSOCO), on 28 August, there was an energy shortage of 77 Million Units (MU), with northern region reporting the highest shortage of 40 MU followed by the western region, reporting a shortage of 31 MU.

Reasons for Shortage

According to the government, the reasons for such shortage are—increase in power demand on account of opening up of the economy throughout the country and less generation from hydropower plants due to shortage of rains which is currently being met by the coal-based power generation.

Other reasons for the shortage of coal supply include disruptions in production in South Eastern Coal Fields Ltd. (SECL) due to excessive rains and refusal to supply coal to certain power plants because of non-payment of dues by some states.

Thermal power plants at the western coast at Mundra designed on imported coal have around 30 days of coal stock and are not supplying power due to Power Purchase Agreement (PPA) related issues.

Measures Being Taken

The Union Power Ministry constituted a Core Management Team (CMT) on 28 August consisting of representatives of CEA, Ministry of Power (MoP) and Coal India Ltd. (CIL) to ensure daily monitoring.

In the first meeting of the CMT, it was decided to regulate coal supply to thermal power plants which currently have coal supplies that can last for 14 or more days. This freed up coal (1.77 lakh tonnes from 26 stations) would be supplied to the plants under super-critical category first and thereafter critical category plants, so that an equitable distribution of coal stocks across all power plants is maintained. This regulation would last for seven days.

It was also decided to map Producing Captive Coal mines with the inter-linked thermal power plants so that coal supply to these plants could be reduced from CIL.

In the second meeting of the CMT, which took place on 29 August, it was understood that one unit of Neyveli Lignite Corporation (NLC), which was shut, would resume operations from September, and another unit, which is under maintenance, would restart its operations from 10 September, thereby ensuring complete capacity utilisation at NLC.

It also emerged that the 1,000 MW Kudankulam nuclear power station would be back on bar before 2 September 2021 and replace some portion of coal generation, thereby reducing pressure on coal requirements.

The National Thermal Power Corporation (NTPC) has decided to increase the production of coal from its captive mines and augment 0.27 MT of imported coal left out from the contracts placed earlier.

Non-payment of Dues

According to the CEA, coal supply has been restricted to 16 power plants due to non-payment of dues. These plants are located in West Bengal, Rajasthan, Maharashtra, Uttar Pradesh, Andhra Pradesh and Chhattisgarh. In such power plants, supply would be restarted only after payment of dues by the states.

According to the government, the Damodar Valley Corporation (DVC) would be clearing dues to the tune of Rs 1,200 crore to the different CIL subsidiaries within a week, which would augment the coal supply to different plants of DVC. This would ramp up the power generation from DVC plants from the present level of 61 per cent to a Plant Load Factor (percentage of energy sent out by the power plant corresponding to installed capacity in that period) to 90 per cent.