Sharp rise in temperature across the country helped Coal India Ltd (CIL) to increase its coal dispatch to the power plants. Data compiled by Coal Ministry shows that average coal supplied to the tune of 1.44 mn t/day during February was the highest recorded in a single month for FY ’21.
On an absolute basis, total dispatch of 40.18 mn t in Feb ’21 witnessed a modest drop of 0.6% m-o-m against 40.43 mn t in Jan ’21 mainly because of lesser number of working days in a non-leap year.
Power generation from coal-fired plants which is a major factor driving the coal movement has been on a roller-coaster ride during the year.
In the first half of FY ’21, the output was curtailed as industrial and commercial activities remain muted amid lock-down restrictions, which later started increasing from Sep ’20 with the relaxation being introduced.
Growth rate slowed down post Nov ’20 due to fall in power consumption; however, indication of early onset of summer has kept generation volume soaring in Feb ’21.
Notably, average coal based power generation per day was assessed 3.05 BU in Feb ’21, up 3% m-o-m from 2.96 BU in Jan ’21, and was also marked 7% higher on the year from 2.85 BU in Feb ’20.
Momentum Likely to Continue:
Higher coal burn at the power plants has resulted into depletion of coal inventories at a faster rate. At the end of Feb ’21, coal stock levels were assessed at 31.906 mn t sufficient for 17 days of power generation, down 6% m-o-m from 33.965 mn t in Jan ’21.
Although, no power plants are in critical need of coal as per the triggered level defined by CEA, which excludes the plants having less coal stock due to outstanding dues and which are not lifting offered coal against the linkage contract.
Nevertheless, number of plants having stock less than 7 days have gradually increased to 20 at the end of Feb ’21. In contrast, number of such plants was only 9 at the beginning of this fiscal.
While, power plants are expected to replenish their stock ahead of the peak summer demand, mandate to maintain normative stock of 19 days would also require increased coal supplies from CIL. Moreover, the upcoming assembly polls in various states too would cause a spike in daily power consumption apart from rising temperature.
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