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Higher coal imports to push up power costs
Steel Insights Bureau
To take care of any shortfall in domestic coal supply, Power Ministry has directed a minimum 6 percent blending of imported coal till September. It has also ordered emergency procurement of power from imported coal-based power plants during April-May period, when availability of power in the day-ahead market is expected to be less than the demand.
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‘Unprecedented’ rise in power demand
Grid India (POSOCO) has reported to the government that energy demand has increased sharply and is expected to remain at increased level during the first half of FY24. India’s coal-based power generation grew 15.5 percent to 49,757.10 million units (MU) during the first half of January 2023 compared to 43,080.78 MU during the first half of January 2022, according to CEA.
On a month-on-month basis, coal-based generation till January 15, 2023 was up by 8 percent as compared to 46,062.85 MU during the same period of December 2022.
During April-January 15, 2022, thermal power generation has risen by 11.6 percent at 896,152.25 MU compared to 803,070.99 MU during the corresponding period of 2021.
Between FY23 and FY30, CEA expects electricity demand to grow at a CAGR
Coal Ministry
of 7 percent. “Although coal supplies has increased during Q4, it is not adequate to meet the unprecedented increase in the demand for electricity,” Power Ministry said.
Steps to procure 1,500MW from imported coal-based plants
Power Ministry has decided to procure 1,500 MW from imported coal-based (ICB) power plants during April-May 2023 period, being seen as the ‘crunch period’ as during that time availability of power in the day ahead market (DAM) is expected to be less than the demand.
NTPC Vidyut Vyapar Nigam Ltd, a wholly-owned subsidiary of NTPC Ltd has been nominated as the nodal agency to facilitate the procurement of 1500 MW.
“This would ensure sufficient supply in the Day Ahead Market, which in turn is expected to have moderating effect on clearing price,” the Power Ministry said on January 23.
The seller of power, to be selected through
