Coal India possesses sufficient buffer stock to increase supply to non-power sector

State-owned CIL on Saturday said it is currently supplying around 3.4 lakh tonnes of coal per day to non-power sector which is the company's average supply to this segment and stressed that it has sufficient buffer stock to increase supply to the sector.

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The development assumes significance in the wake of reports of captive power plants in various sectors including steel and aluminium facing fuel shortages.

The non-power sector (NPS) imports around 170 million tonnes (MT) of coal in any given fiscal for blending with domestic coal. But in FY'22 the spiralling international coal prices proved to be a hindrance for importing requisite quantity, giving rise to scarcity of coal at their end.

Coal India's "despatch to NPS during April-January FY'22 at 101.7 million tonnes was up by 8.2 per cent compared to 94 MTs in corresponding period of a standard pandemic free FY20. For comparable period of even FY19, when CIL recorded the highest ever total coal despatch since its inception, supply to NPS sector grew by 11 percent over 91.5 MTs", the mahratana firm said.

Growth in supplies to non-power sector customers was at a higher rate than the supplies to the power sector during this period.

In dispatch during the April-January period to NPS segment at 105 MT was higher by a little over 3 MT compared to same period of FY'22. The reasons for increased despatch during the Covid ravaged year were several.

As power sector regulated coal intake for major part of FY'21, due to demand disruption caused by Covid, CIL scaled up supplies to NPS segment. Further, NPS customers also opted to lift higher volumes of coal as CIL's e-auction sales were capped at notified price for the first half of FY'21.

With more than 37 million tonnes of coal at its pitheads, the PSU aims to further step up supplies to this sector.

"CIL has sufficient buffer stock to increase supply to non-power sector. Coal availability is not a problem, the company said.

CIL said FY'22 has witnessed an unprecedented surge in power generation, the growth rate being the highest in a decade, necessitating the need to meet the power sector's coal demand on a national priority.

Riding on robust economic recovery, total coal-based power generation till January of the fiscal in progress grew by 11.2 per cent on year-on-year comparison. Whereas domestic coal-based generation was up by 17 per cent during this period. Bulk of the coal supply to power sector was met by CIL on priority.

In a sharp contrast, power generation by 14 imported coal-based power plants was down by 48 per cent during April-January 2021-22. Meeting the resultant generation gap fell on domestic coal-based generators requiring enhanced indigenous coal supply. CIL supplied to the tune of around 20 MT of this additional demand. In other words, imports were curtailed to that extent.

Despite prioritisation of coal to the power sector and facing other challenges, CIL at 101.7 MT till January FY'22 supplied 97 per cent of same period last year's quantity to NPS customers.
Coal India accounts for over 80 per cent of domestic coal production.