India to Double Thermal Coal Linkages

07 Nov 2023 CW Team

Coal linkages play a crucial role in supplying power plants, with the power sector being the largest consumer of domestic coal in the previous fiscal year, accounting for 84% of total dispatches.

The surge in coal linkages aligns with the government's plans to boost domestic coal production to 1.5 billion tonnes and increase the peak-rated capacity of coal mines to 2 billion tonnes, ensuring that coal production matches demand.

The power sector's peak demand is forecasted to reach 334.8 GW by 2030, well above the Central Electricity Authority's estimate of 230 GW.

While India is actively expanding its renewable energy capacity, coal remains a cornerstone of the power sector, contributing around 75% of the country's electricity generation.

The rise in coal linkage projections comes as India strives to meet its growing power demand while ensuring a consistent supply of coal to power plants. This initiative aims to prevent the near-crisis situations experienced in FY22 and FY23 due to power demand and coal supply mismatch.

Coal India has reported a 12% increase in production so far in the current fiscal year, with 394 million tonnes produced. The power sector has also seen a 4.5% increase in coal supplies to 346 million tonnes during the April-October period.

Despite efforts to boost domestic coal production, the Ministry of Power recently directed power generation companies (gencos) to blend 6% imported coal until March next year due to falling inventory at thermal plants.

As India seeks to increase its renewable energy capacity to 500 GW by 2030, coal is expected to remain a key element of the power sector, ensuring a elestable electricity supply while transitioning to cleaner energy sources.

India's drive to harness its coal resources is expected to persist, with coal linkage to thermal power projects projected to increase from around 550 million tonnes to 1 billion tonnes. This is significant as India boasts the world's fourth-largest coal reserves and is the second-largest coal producer. The country's coal production is expected to reach 1 billion tonnes this year. Coal linkages play a crucial role in supplying power plants, with the power sector being the largest consumer of domestic coal in the previous fiscal year, accounting for 84% of total dispatches. The surge in coal linkages aligns with the government's plans to boost domestic coal production to 1.5 billion tonnes and increase the peak-rated capacity of coal mines to 2 billion tonnes, ensuring that coal production matches demand. The power sector's peak demand is forecasted to reach 334.8 GW by 2030, well above the Central Electricity Authority's estimate of 230 GW. While India is actively expanding its renewable energy capacity, coal remains a cornerstone of the power sector, contributing around 75% of the country's electricity generation. The rise in coal linkage projections comes as India strives to meet its growing power demand while ensuring a consistent supply of coal to power plants. This initiative aims to prevent the near-crisis situations experienced in FY22 and FY23 due to power demand and coal supply mismatch. Coal India has reported a 12% increase in production so far in the current fiscal year, with 394 million tonnes produced. The power sector has also seen a 4.5% increase in coal supplies to 346 million tonnes during the April-October period. Despite efforts to boost domestic coal production, the Ministry of Power recently directed power generation companies (gencos) to blend 6% imported coal until March next year due to falling inventory at thermal plants. As India seeks to increase its renewable energy capacity to 500 GW by 2030, coal is expected to remain a key element of the power sector, ensuring a elestable electricity supply while transitioning to cleaner energy sources.