- Lower stocks in south point to need for inter-regional power transfers
- Coal-rich, central states maintain much larger fuel inventories
Coal stock levels at thermal power plants have improved significantly compared with the tight conditions seen in previous years. Total coal inventory across monitored plants rose from 45.8 million tonnes (mnt) in September to 59.3 mnt in February, indicating that the system has entered the summer season with comfortable overall fuel availability.
This steady increase reflects strong domestic coal supply, improved logistics, and higher stock-building by utilities ahead of the summer demand season.
However, while national stocks appear comfortable, the regional distribution of coal stocks remains uneven, and this could become important as electricity demand rises in the coming months.
Regions with the lowest coal stocks
Several states that experience strong electricity demand have relatively lower coal inventories compared with major coal-producing states. Coal stock levels remained relatively low across several Indian states in February 2026, highlighting regional supply tightness.
Among the states with the lowest inventories, Assam reported the smallest stock at 0.23 mnt. Karnataka and Telangana followed with 1.36 mnt and 1.8 mnt, respectively. Punjab and Rajasthan maintained slightly higher but still limited reserves at 2.04 mnt and 2.14 mnt.
Meanwhile, Tamil Nadu held the highest stock among these states at 2.86 mnt, though levels still indicated relatively constrained availability compared to states with stronger coal inventories. Overall, the data suggests that several regions were operating with tight coal buffers during the month.
These states are largely located in the southern and northern regions, where electricity demand typically rises sharply during the summer months due to air-conditioning load, irrigation pumping, and industrial consumption.
Lower stock levels in these regions mean they are more dependent on steady coal deliveries from producing regions such as Chhattisgarh, Odisha and Jharkhand.
Coal-producing states hold the largest stocks
In contrast, coal-rich and central states maintain much larger fuel inventories. In February, several states maintained comparatively high coal inventories, reflecting stronger supply buffers at power plants. Chhattisgarh and Uttar Pradesh reported the highest coal stocks at 8.49 mnt and 8.48 mnt, respectively.
They were followed by Maharashtra with 5.26 mnt, while Gujarat and Madhya Pradesh held 4.47 mnt and 4.34 mnt. Meanwhile, West Bengal and Odisha also recorded substantial reserves at 3.84 mnt and 3.33 mnt, respectively. Overall, these states accounted for the largest coal stock holdings during the month, indicating relatively stronger fuel availability compared to other regions.
These states host several large pithead power plants located close to coal mines, allowing them to maintain higher inventories and operate with lower transport risk.
For example, Chhattisgarh hosts several large coal-based stations, including NTPC, Jindal Power and CSPGCL plants. Uttar Pradesh, India’s largest electricity-consuming state, has built up significant stocks at major NTPC and state-run plants. Maharashtra also maintains substantial reserves across MAHAGENCO, NTPC, and private generators.
Implications for the summer demand season
The distribution of coal stocks becomes particularly important as India moves into the summer months, when electricity demand typically rises sharply.
The earlier analysis of early March demand trends already shows that national peak demand reached 238 GW on 7 March, slightly higher than the previous year.
As temperatures increase further during April and May, peak demand could move significantly higher.
Regions with relatively lower coal inventories — particularly southern states such as Telangana, Karnataka and Tamil Nadu — may therefore rely more heavily on inter-regional power transfers, renewable generation, and spot market purchases through power exchanges.
Meanwhile, coal-rich central and eastern states are likely to remain the main base-load suppliers for the national grid, given their higher coal stock levels and proximity to domestic coal mines.
Market implications
The current coal stock situation suggests that India is entering the summer demand season with adequate fuel availability, reducing the risk of the severe coal shortages seen in earlier years.
However, regional imbalances in coal inventory could still create localised supply tightness if demand rises sharply in southern or northern states.
This dynamic may also contribute to the higher trading volumes seen on the Indian Energy Exchange, where utilities increasingly turn to short-term markets to balance supply and demand.
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