Coal import cannot be zero, its blending with domestic dry fuel helped plants maintain stock: Govt

Coal imports cannot be reduced to zero as several thermal power projects in India are designed to utilise the imported dry fuel for its high calorific value and blending it with domestic coal is also needed to maintain fuel stocks, Parliament was informed on Tuesday.

"The power plants designed for utilizing high Gross Calorific Value (GCV) non-coking coal, and cement, sponge iron, aluminum customers are utilizing high-ranked low ash coal. The coal requirement for such category of consumers cannot be substituted by domestic coal. Thus, import of coal cannot be reduced to zero," Power Minister R K Singh said in a written reply to the Rajya Sabha.

Singh said thermal power plants have been importing coal for blending since 2009.

During 2022-23 (till January 2023), Coal India Ltd despatched 485.99 million tonne (provisional) coal to the power sector as compared to 440.05 MT during the same period a year ago, registering a growth of about 10 per cent.

However, he stated that with the rise in electricity demand, the increase in supply of coal to power plants is not commensurate with the domestic coal requirement.

Also Read: Declining core inflation limits need for further interest rate hikes by RBI: S&P

The gap between daily coal consumption and daily arrival of domestic coal ranged from 2.65 lakh tonne to 0.5 lakh tonne between September 2022 and January 2023.

If the imports for blending had not been made, coal stocks at thermal power plants would have been reduced to zero in September 2022, he pointed out.

Therefore, he said, Ministry of Power advised central, state gencos and Independent Power Producers (IPPs) on January 9, 2023 to import coal through a transparent competitive procurement for blending so as to have sufficient coal stocks at their power plants for smooth operations till September 2023.

About the high price of imported coal, he said its price is not comparable with that of domestic coal due to difference in calorific value.

The pricing of imported coal is linked with international indices, source of origin and factors like ocean freight, insurance etc which vary with international demand-supply scenario, he explained.

Every power generating company imports coal as per its requirement, he told the House.

In another reply to the House, he said power generating companies (gencos) procure coal from coal supplier companies and need to pay for the same.
Ministry of Power monitors supply of coal to power plants in coordination with ministries of coal and railways.

As on January 31, 2023, the stock of coal with power plants was 31.5 MT, he stated.

Catch latest stock market updates here. For all other news related to business, politics, tech, sports and auto, visit Zeebiz.com.