Govt Set To Import 76 MT Coal To Meet Power Demand: Report

Coal import may result in a hike in electricity tariff by 50-80 paise, according to the report

Coal India Ltd would import 15 MT to supply to the plants as India's coal production is affected in the monsoon season and coal supplies to power plants are hit in August and September. ( Image Source :Getty )

The government has decided to import nearly 76 million tonnes (MT) of coal this fiscal year to help plug a shortfall of fossil fuel in power plants, Mint reported, citing two government officials.

According to the report, this move may result in a hike in electricity tariff by 50-80 paise.

The report said that state-run Coal India Ltd (CIL) would import 15 MT to supply to the plants as India's coal production is affected in the monsoon season and coal supplies to power plants are hit in August and September.

According to the news report, India's largest power generator NTPC Ltd and Damodar Valley Corporation (DVC) will import another 23 MT of coal. Power generating firms and independent power producers (IPPs) are planning to ship another 38 MT this fiscal year.

On June 9, India met peak electricity demand and it touched a record high of 211 GW. On July 20, the maximum power demand met stood at 185.65 GW as demand eased during the monsoon. The power tariffs will increase depending on the distance of the power stations from the seaport.

Imports have become necessary amid an increase in demand led by heat waves across the country.

According to the report, power plants in India currently consume about 2.1 MT of coal daily.

One of the officials told Mint, “The fuel bill will vary from generator to generator. For NTPC and DVC, after blending 10 per cent of imported coal, the cost will be up 50-60 paise per unit. For others, it will depend upon distance, and vary from 50 to 80 paise. We shall be able to weather the crisis, given the arrangements that have been made,” while adding, “One has to observe till September to see if we have weathered the crisis. The imported coal orders by our companies have started coming in.”

During this period, the shortfall is generally around 15 MT, which the Coal India will meet from July end, the official said.

“The problem will come in August-September. We are assuming that the supply shortage may remain till October 15. Hopefully, we will tide over the problem with the help of imported coal. The problem may kick-in after August 15,” the official added.