India's surplus coal power capacity under development

09 Aug 2023 CW Team

It has been observed that the country is actively working on the development of approximately 65.3 GW of coal power capacity. Among this total, about 30.4 GW of coal power capacity is currently under construction, and an additional 35 GW is in various pre-construction phases. The researchers have determined that India granted approvals for coal projects amounting to approximately 3.9 GW, while around 7.6 GW received Terms of Reference, indicating a step closer to obtaining permits.

Flora Champenois, a research analyst at GEM, remarked that the surge of coal approvals in India during 2023 signifies a change in the nation's energy transition pattern. In the previous year, India did not provide approval for any new coal power plants to be integrated into the grid. This approach aligned with the global trend of moving away from environmentally harmful and outdated energy sources.

The study also emphasises that the present proposals for coal capacity expansion in the country exceed the already significant expansion projected in the energy plan. The analysis of the National Electricity Policy (NEP 2023) indicates that the under-development coal power capacity in India surpasses the estimated requirements for both 2027 and 2032. As per the study's findings, more than 8 GW of non-captive coal-fired power plant capacity currently in active construction is deemed unnecessary, along with the entire 34.9 GW of pre-construction capacity. The 10-year coal projections within the plan do not necessitate the initiation of any new projects in the pre-construction phase.

Sunil Dahiya from CREA stated that the electricity demand estimates within the plan have historically been overstated. This overestimation has previously resulted in the transformation of billions of dollars' worth of coal power plants into non-performing assets (NPA). The ongoing push for an increased number of coal power proposals in India exceeds the actual requirements, thereby raising concerns of potential creation of more stranded assets in the future.

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The latest analysis by Global Energy Monitor (GEM) and Centre for Research on Energy and Clean Air (CREA) has revealed that around 11.5 gigawatts (GW) of coal power capacity under development in India progressed through different approval stages in the first five months of the current year. It has been observed that the country is actively working on the development of approximately 65.3 GW of coal power capacity. Among this total, about 30.4 GW of coal power capacity is currently under construction, and an additional 35 GW is in various pre-construction phases. The researchers have determined that India granted approvals for coal projects amounting to approximately 3.9 GW, while around 7.6 GW received Terms of Reference, indicating a step closer to obtaining permits. Flora Champenois, a research analyst at GEM, remarked that the surge of coal approvals in India during 2023 signifies a change in the nation's energy transition pattern. In the previous year, India did not provide approval for any new coal power plants to be integrated into the grid. This approach aligned with the global trend of moving away from environmentally harmful and outdated energy sources. The study also emphasises that the present proposals for coal capacity expansion in the country exceed the already significant expansion projected in the energy plan. The analysis of the National Electricity Policy (NEP 2023) indicates that the under-development coal power capacity in India surpasses the estimated requirements for both 2027 and 2032. As per the study's findings, more than 8 GW of non-captive coal-fired power plant capacity currently in active construction is deemed unnecessary, along with the entire 34.9 GW of pre-construction capacity. The 10-year coal projections within the plan do not necessitate the initiation of any new projects in the pre-construction phase. Sunil Dahiya from CREA stated that the electricity demand estimates within the plan have historically been overstated. This overestimation has previously resulted in the transformation of billions of dollars' worth of coal power plants into non-performing assets (NPA). The ongoing push for an increased number of coal power proposals in India exceeds the actual requirements, thereby raising concerns of potential creation of more stranded assets in the future. Also read: Nilkanth coal mining wins Sherband coal block in 7th auction 6 coal mines auctioned in 7th tranche; NLC, NTPC win