With the substantial increase in power and electricity supply for the coming few weeks and estimation for its further increase in demand, the union power ministry has now recommended the direct import for coal blending by up to 10% to make sure that we have an adequate supply of power and supply.
The ministry has also further allowed the tolling of coal which in short means that the electricity producers with an access to coal near a plant can now directly transport it rather than being dependent to transport it from mines at a faraway location.
The measure has followed that all coal inventories are dropping their lowest pre summer level of 9 years and therefore the power demand for supply is expected to increase at a much faster pace of 38 years.
As per the official statement issued by the Ministry, it stated that now coal tolling will be allowed all state power generating companies (gencos) to make sure that there is optimal utilization of coal. It said that, “In order to avoid long-distance coal transport in respect of certain state gencos, tolling facility would be allowed up to 25 percent of linkage coal”.
The tolling module will allow the gencos to utilize coal from the nearest linkages available to them for supplying them to the independent electricity producer on a competitive bidding process. It will help the independent electricity producer to effectively produce power and supply it further to the states which has originally coal linkage.
The official statement of the Ministry further stated that “The minister took a review of the operations of imported coal-based plants and directed all the procurer states to ensure that all Imported Coal Based (ICB) plants are operational at fair and reasonable tariffs. Therefore it was then decided that it will all help to resolve all the operational issues in the ICB plants and make them fully and better functional,” the statement said.
Also, with the ever rising demand for power and to fight back this challenge it is best recommended for all gencos that they shall make it a point to import coal with blending for up to a limit of 10%. The genco wise and state wise targets are already fixed and there is a strict urge to meet the timely delivery of coal for coal blending purposes before the raging demand increase in power supply at the onset of monsoon season.
In an addition to this, the government and ministry is looking for ways to avoid a repetition of last year when most of the big states saw power cuts due to depleting coal stocks. During this time of the year, it is working on its ways and finding different aspects of the supply chain of fuel as power supplies may have not been able to meet up with the increasing and growing demand and it is no doubt the international coal prices also continue to soar.
With 75 percent of India’s electricity is generated through thermal power, the government is working with a priority to increase supplies to the electricity and power sector and allow other sectors to push and scale-up output from their captive electricity power plants.
Credit Source: https://solarquarter.com/2022/04/14/ministry-allows-coal-tolling-states-can-import-coal-for-blending-up-to-10-to-meet-rising-power-demand/