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Power Ministry asks CEA to determine appropriate quantity of domestic coal for power plants

by Team Indopost
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India has produced 51.7 Million Ton (MT) raw coking coal during the financial 2021-22 which is 15 % more as compared to 44.8 MT during FY21. Domestic raw coking coal production continues to witness increasing trend in the current fiscal as well with production of 8.3 MT, as per the figures up to May 2022, which is 20% more compared to 6.9 MT during the same period of the previous year. At present, domestic raw coking coal washing capacity is about 23 MT per annum including 9.26 MT of the private sector. Coal India Ltd.(CIL) is planning to set up and operationalize nine more new washeries with a capacity of 30 MTPA. With setting up of new washeries, it is estimated that CIL will be able to supply about 15 MT of washed coking coal to the steel sector, thereby reducing import of coking coal. There is need to set up more washeries to enhance capacity to meet the fast increasing demand of coking coal in the country. During FY 22, CIL supplied 1.7 MT washed coking coal to the steel sector and has set a target of 3.45 MT during FY23. To further enhance raw coking coal production, the Ministry of Coal has auctioned 10 coking coal blocks to the private sector with a PRC of 22.5 MT during the last two years. Most of these blocks are expected to start production by 2025. The Ministry has also identified four coking coal blocks and the Central Mine Planning and Design Institute (CMPDI) also will finalize GR for 4 to 6 new coking coal blocks in the next two months. These blocks may be offered in subsequent rounds of auction for private sector to further step up domestic raw coking coal supply in the country. CIL has planned to increase raw coking coal production from existing mines up to 26 MT and identified nine new mines with PRC of about 20 MT by FY 2025. Also, CIL has offered six discontinued coking coal mines, out of the total 20 discontinued mines, on an innovative model of revenue sharing to the private sector with expected PRC of about 2 MT. With these transformative measures taken by Ministry of Coal under ‘Atmanirbhar Bharat’ initiative of PM, domestic raw coking coal production is likely to reach 140 MT by 2030.

NEW DELHI:

Power Ministry has directed CEA to determine the eligible quantity of domestic coal for the power plants using coal under Shakti B(viii) (a) taking into account 10% imported coal for blending which is equivalent to about 15% of domestic coal in energy terms. Shakti B (viii) (a) is the window for power plants having untied capacity to bid for coal, to generate power using this coal and sell it in the exchange under Day Ahead Market (DAM) or the DEEP portal for short term PPA.

For such plants, Ministry has directed CEA to compute the quantity of coal consumed (procured under SHAKTI B (viii) (a) window) on the basis of mandatory blending of 10% by weight for generation during the period starting from 15th June 2022 upto 31st March 2023. This will give a window of about 3 weeks for these plants to procure imported coal.

Considering the increased demand of electricity, and coal supplies from domestic coal companies not matching with the consumption of coal, Power Ministry advised all Gencos including IPPs on 28.04.2022 to blend 10% of imported coal for power generation. This was done to supplement domestic coal supply.

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