Coal likely to remain in short supply until 2024, CIL tells govt

business-standard.com Viewpoint,  International 2019-09-11 11:49:15

Coal is likely to remain in short supply until 2024, national miner Coal India has informed the ministry of coal in a recent note. Considering the current fuel supply agreements (FSAs) and several MoUs for coal supply, Coal India said the current year will witness a deficit of 168.45 million tonne; the next year's shortfall will be 71.25 million tonnes.


Coal India also said the deficit may widen to 262.4 million tonnes in the current financial year, if the Centre brings in more schemes. And if such a scenario prevails, the deficit will be 111.27 million tonnes for the next financial year. According to the note, the deficit will continue until 2026 in such a case.


In the current financial year, Coal India has set a production and sales target of 660 million tonnes, which it plans to scale up to 710 million tonnes in the next financial year. During 2024-25, the company aspires to achieve a production of 940 million tonnes of coal.


Coal India expects a spurt in demand of coal as more households get electricity connections and industrial demand bounces back. Coal offtake to the power sector increased by 29.3 tonnes during the last 11 months, thereby improving the coal stock situation at power units. CIL sold 411.5 million tonnes coal to the power sector during the April-February period last year.


During the last quarter, Coal India sold 142.42 million tonnes of coal via the FSA route, which helped it earn Rs 20,794.15 crore; another Rs 4,602.64 crore was earned by selling 16.71 million tonnes of coal via the e-auction route.


Besides the FSA and the e-auction routes, Coal India has started supplying for the new scheme of the Centre — SHAKTI.


The Scheme for Harnessing and Allocating Koyala Transparently in India or SHAKTI is for power units with power purchase agreements (PPAs) but no long-term coal supply. Under the scheme, Coal India offers assured coal supply to units through bidding. The units have to quote the discount in their power tariffs that they would offer after getting cheaper coal from the company. The total quantity booked was 27.8 million tonnes of coal.


Including SHAKTI, Coal India is currently supplying coal through more than 12 supply channels. This includes linkage auctions, FSAs with public sector companies, e-biddings, linkages with states, and short-term PPAs.


(Writing by Becky Du  Editing by Tammy Yang)
For any questions, please contact us by inquiry@fwenergy.com or +86-351-7219322.

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