Coal-fired plants in the country have reported a decline in inventory levels as increased coal consumption puts supply under pressure.
As on 27 Mar’22, the inventory was assessed at 25.44 mnt, indicating a marginal fall compared to 25.97 mnt recorded at the end of Feb’22, as per the data provided by the Central Electricity Authority (CEA).
This put a break on the power plants’ efforts to replenish the depleted stock which came down to a 3-year low of 11.41 mnt at the end of Sept’21. Incidentally, the inventory level progressively increased since then up to Feb’22.
The stock replenishment gradually picked up momentum with an increase in coal supplies, but the pace slowed down in the ensuing months with a revival in power demand. In fact, the closing stock for the January-March period has remained almost stagnant.
Adding to the woes, the gradual rise in temperature with the onset of summer has increased power plants’ generation schedule.
Scaling new highs, the coal-based plants generated 3.47 billion units (BU) of electricity on 25 Mar’22. As a result, the average output was lifted to 3.29 BU/day in Mar’22 against 3.13 BU/day in Feb’22, which was also around 2% higher than the year-ago levels.
Coal supply to plants not adequate
Notwithstanding the increased demand, coal dispatches dropped, putting these plants in a hand-to-mouth situation as logistic constraints pose a key challenge to the supply chain.
During the first 28 days of Mar’22, the plants received coal at an average of 2.16 mnt/day from domestic as well as imported sources, which was almost at par with the consumption rate of 2.17 mnt/day.
On its part, state-run miner Coal India Ltd (CIL) scaled-up its production to 2.57 mnt/day in Mar’22. However, its overall dispatches to various sectors, including power plants, registered at 1.99 mnt/day, were still lower than in the previous month.
Moreover, there is an additional burden on the domestic coal-based power plants to compensate for the generation loss from the imported coal-based ones. Notably, only 6 out of 14 such plants are currently in operation as on 24 Mar’22, as per the power ministry.
In this scenario, the government is likely to make an all-out effort to ensure uninterrupted electricity supply in the peak summer season. This implies that power plants would continue to be first in line for coal supplies, thereby depriving the non-regulated sector of its share in the short term.
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