India on brink of energy crisis, coal shortage – power stations on alert

A surge in energy demand had left power stations with an average of four days’ worth of coal at the end of last month, the lowest level in years – an energy crisis awaits India. Of the 104 thermal plants monitored daily, 15 with a generation capacity of 14,875 MW had zero days of coal stocks on September 30, while another 39 with a capacity of 52,530 MW had stocks of less than three days.

Power Minister Raj Kumar Singh told The Indian Express that it’s going to be a touch and go. Singh said the bridging of the fuel gap is still likely to be a touch and go affair, and that he is bracing for a trying “next five-six months”.

India’s coal crisis has been spurred by the deficient stock build-up in April-June 2021, and the sharp fall in imports due to high international prices of coal. Normally too, all-India electricity peak demand is recorded in October, which typically follows a monsoon-impacted mining output trough.

Moreover, the economic revival after the second COVID wave has brought about a rise in the share of coal-based power in the electricity mix. India has an installed capacity of 388 giga watt (GW), of which nearly 55% is coal-fired and operates as base load.

“I can’t say I am secure. If you have 40,000-50,000 MV with less than three days of stock, you can’t be secure,” the power minister said. “I don’t know whether I will be comfortable in the next five-six, four-five months. Normally demand starts coming down in the second half of October when the weather starts cooling. But it’s going to be a touch and go.”

Singh highlighted that his team is working continuously in coordination with other ministers to avert a crisis, and that till now there is nowhere that they have not been able to supply the quantity of power demanded. “If there has been load-shedding, it must be for other reasons.” He noted that demand has gone up tremendously. “In August, the demand was 124 billion units. Compared to pre-COVID period, the demand has increased in one month by 18 billion units. We touched 200 GW during COVID period, and the demand has been hovering around 170-180 GW. I expect it to go up again to near about 200 GW, and stay there.”

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The minister said demand is not going to go away, in fact, it’s going to increase. “We have added 28.2 million consumers. Most of them are lower-middle class and poor, so they are buying fans, lights, television sets.”

On the positive side, Singh pointed out that India’s idle power capacity can be utilized optimally. He said the load factor for India’s electricity system was around 60%, meaning that about 40% of capacity was not being scheduled on a daily basis. Some of this is also because the new capacity addition has been in the form of renewables.