CCAI Newsletter November-21

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Vol. L No. 08 Published on : 28.11.2021 CCAI Monthly Newsletter November 2021

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2 | CCAI Monthly Newsletter January 2021 jsplcorporate

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From the Editor’s Desk

Following a few months of inte nse Power demand and appreh ensions on severity of the situation over the nat ion, India’s coal shortage eas ed in November as concer ted efforts by the Min istry of Power, Coal and Rai lways have enabled generators to avert the cris is, rebuild depleted coal sto cks and the grid to operate with greater stability.

While there is no immediate uncertainty, it has successful ly alluded to the possible calamity that over-d ependence on coal might lead this nation to.

With commitments made at the United Nations Climate Change Conference in Glasgow earlier this year to “phase down” coal usage and achieve net-zero emissions target by 2070, the country with third highest coa l-reserves in the world is clearly looking to dev ise a plan-B for sustainable gro wth.

However, India cannot afford to dump coal in a jiffy as it is the cheapest fuel available in abundance dom estically for fuelling the leve l of economic growth needed to lift hundreds of mil lions out of poverty.

In spite of a lot of promise, inte rmittency and vulnerability to adverse weather conditions remain major issu es with renewables. The recent double-digit surge in power demand amid low er generation from solar, win d and hydel sources due to seasonal factors once again highlighted the actual scenario as coal-fired plants stepped up to meet the demand.

Thankfully, the work has alre ady begun. Since coal has to play the role of primary fuel for power gen eration in our country for the time being, the Ministry of Coal has already moved forward with a compre hensive Sustainable Development Plan.

Action has already started for its speedy implementatio n. Emphasis is to put major thrust on Sustainable Development in coal mining , taking care of its environmental and social imp act such as the inception of a full -fledged Sustainable Development Cell (SDC) in Min istry of Coal to advise, mento r and plan action to minimise the adverse impact of mining. Apart from sugges ting a way-forward, SDC is also formulating a fut ure policy framework for env ironmental mitigation in the Coal and Lignite sector s of our country.

In line with our country’s com mitment to reduce the total projected carbon emissions by one billion tonnes within 2030, Bio-Reclamatio n of mined out land has already been taken up on a big scale by all coal compan ies through massive tree plantation drives. In nex t five years, the target is to cover more than 12000 hectares of land for plantation which will help in having carbon sink potential to the tune of mo re than one lakh tonne per annum, as per details released by the Government.

Phasing down coal from the pow er sector makes economic sen se given the falling costs of Renewable based elec tricity and will most likely be the path that India takes. To phase down unabat ed coal from the industrial sector would require commercial availability of tec hnologies such as carbon captur e, batteries for grid storage, and green hydrogen.

May be in line with South Afr ica at present, suppor t from developed countries in terms of low-cost finance and technology transfer or codevelopment would be required in India as well to materialize these developments .

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CONTENT Vol. L No. 08 November 2021

Official Organ of the Coal Consumers’ Association of India. Disseminates News and Views on Coal and all other sources of Energy.

4, India Exchange Place - 7th Floor Kolkata - 700 001 Landline : +91 33 22304488 E-mail : sec.ccai@gmail.com Website : www.ccai.co.in

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Consumers' Page

12

Power

18

Domestic

24

Global

Editor : Subhasri Nandi Annual Subscription Rs. 400/(including postage) MO/DD to be made in favour of “Coal Consumers’ Association of India” CCAI do not necessarily share or support the views expressed in this Publication.

30 Monthly Summary Of

Imported Coal &Petcoke

33

Production And Offtake Performance Of Cil And Subsidiary Companies

34 Overall Domestic Coal Scenario

CCAI Monthly Newsletter November 2021

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CONSUMERS’ PAGE Present Coal Scenario: National miner Coal India Limited’s production and offtake figures for November ’21 improved compared to the same month a year ago as the unprecedented coal crisis across India’s Power sector eases out to an extent and coal stock at most of the inventories rose above critical level. In November, CIL produced 53.8 MT of coal which is over 4% more than 51.7 MT in Nov ’20. For the period of April’21 to November’21 CIL’s cumulative production stands at 353.4 MT which is 5.6% higher than the same period last year, when all sectors including coal were severely hit by the pandemic outbreak.

Coal offtake by the Maharatna Company has also gone up by more than 10% from 51.3 MT in Nov ’20 to 56.8 MT in November this year. The cumulative coal offtake figures

by CIL for the ongoing fiscal has been nearly 18% higher than the same period in the previous financial year.

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Issues faced by Power Sector Consumers:

regarding significant grade slippage in coal supplied via Rail Mode:

1. Submission by Power sector regarding regular and significant short-supply from various mines of MCL, SECL, ECL & WCL: *Power consumers procuring coal from MCL’s Talcher, Sardega and IB Valley sidings under Linkage auction FSA were facing regular shortreceipt in rakes to the tune of 4%-5% while on some occasions, short-receipt ranged up to 9% as well. The issue of short-receipt kept recurring even after recalibration of weighbridges of the affected sidings. *ForPower Utilities procuring coal from SECL’s Burhar, Churcha, Naurajabad, Bhatgaon, Rajnagar OC, Katora and NCPH sidings, 4%-7% short-receipt was occurring in almost all the rakes supplied during Oct-Nov’21 period. *ForPower Utilities procuring coal from ECL’s Bankola, Jhanjra, SonepurBazari, Pandaveswar, regular short-receipts to the tune of nearly 2% was occurring in the rakes supplied from those sidings in October ’21. *For Power Sector Consumers procuring coal from various sidings in Wani area of WCL, regular short-receipts to the tune of over 3% was occurring in the rakes supplied during October ’21.

As such regular instances of short-receipts lead to significant financial loss to the generators, requests has been made to CIL and the concerned Subsidiary Coal Companies to take up necessary measures including ensuring proper loading of coal in rakes, examining the weighbridges at regular intervals etc. so that the issue of short-receipt could be mitigated. .

2.

Submission

by

Power

sector

*Power Sector Consumers procuring coal from ECL’s POCP, Bankola, SonepurBazari sidings were facing the issue of grade slippage as coal received from those sidings during August-October ’21 period had been 3-4 grade lower than the declared grades (G4-G5), while in a few rakes grade slippage has been as high as 7 grades. *Power Sector Consumers procuring coal from NCL’s Dudhichua, Dudhichua WW, Bina WW, Block-B sidings were facing the issue of grade slippage as coal received from those sidings during August-October ‘21 period had been 2-3 grade lower than the declared grades (G7-G11). *Power Utilities procuring coal from CCL’s Birds Sounda and Churi sidings were facing the issue of grade slippage as coal received from those sidings during August-October ‘21 period had been 2-3 grade lower than the declared grades (G7-G9) while in a few rakes grade slippage has been as high as 5 grades.

As some of these Power Plants are in agreement to supply the entire power generated to the state discoms, request has been made to CIL and the respective Subsidiaries take adequate steps in order to eradicate grade slippage and ensure supply of FSA-grade of coal.

3. Submission by Power consumers regarding impediments of coal transport through RcR mode: While procuring coal through Road-cum-Rail (RcR) mode as and when supply through Rail mode is not sufficient, the Power Sector Consumers are facing certain issues: *As it is an intermittent supply arrangement, number of interested bidders is significantly less which causes the rate for loading and transportation of coal to be significantly higher

CCAI Monthly Newsletter November 2021

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than the long-term contract awarded by the Coal Companies.

5. Request for consideration of CEA norms in determining normative coal *There is substantial time lag between the issu- requirement for CPP sub-sector in ance of DOs and starting of supply of coal from Tranche-V NRS Linkage Auction: pithead to Railway good sheds in RcR mode due to formalities such as obtaining mining permit, truck permit etc.

*Each Road loading point functions with a fixed capacity for loading a certain number of trucks per day. Therefore, when more consumers procure from the same source, deployment of no of truck per consumer gets drastically reduced resulting in lifting of less quantity on a daily basis.

Request has been made to CIL to ensure that consumer-wise allocation of coal quantity may be commensurate with the loading capacity as per available infrastructure of a particular road loading point to avoid congestion at mine end and rational allocation of good sheds / private sidings based on booked quantity may be provided to ensure smooth supply of coal under RcR mode.

As per coal consumption norms laid down by CEA for CPP Sector, certain factors needs to be considered for calculating normative coal requirement including loss of heat value of coal for storage @85 KCal/kg, 5% GCV loss due to the difference between GCV (ARB) and GCV (EQ) and 0.8% transit loss. However, these factors are not considered in the calculation of normative coal requirements as given in the scheme document of CIL. As a result, the Captive Power Plants will be eligible for less quantity of coal in comparison to their actual coal requirement in the upcoming NRS Linkage Auction.

Request has been made to CIL so that normative requirement of coal in the CIL scheme document for NRS linkage auction for the different capacity Captive Power Plants may be calculated as per existing CEA guidelines.

4. Submission by Power Sector to ex- 6. Request for allowing NRS Consumers who had cancelled their FSA within pedite release of e-Auction rakes: Lock-in period to participate in the There has been extremely low materialization of Tranche-V NRS Linkage Auction: rakes allotted under e-Auction including Special Forward e-Auction for Power Sector. It has been pointed out that a large number of rakes allotted for Power Sector under various e-Auction schemes have been pending since long.

Request has been made to CIL so that at least 15% - 20% of the total supply of rakes / day may be earmarked and supplied against e-Auction quantities. This would enable the Power houses to build up their stock levelswithin the ensuing Q3 & Q4 of the current FY with adequate supply.

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The successful bidders of Tranche-IV NRS Linkage Auction, who had cancelled their FSAs within the lock in period of two years, are debarred from participating in the ongoing Tranche-V NRS Linkage Auction as per FSA norms. Also, may have terminated their FSAs even after the completion of lock-in period are also not being allowed to participate in the upcoming Tranches as their IDs have been blocked due to untimely termination of Tranche-IV agreement.

However, respective quantities booked by these NRS consumers in Tranche-I have already expired.

Request has been made to CIL to allow these

CCAI CCAI CCAI Monthly CCAI Monthly CCAI CCAI Monthly Monthly Monthly Monthly Newsletter Newsletter Newsletter Newsletter Newsletter Newsletter September November August June April May July 2021 2019 2020

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consumers to participate in the ongoing NRS Linkage auction for CPP and Other Sub-sectors (Tranche-V) for materialisation of their eligible normative quantity except the terminated quantity within the lock-in period of the immediately previous tranche (Tranche-IV).

7. Submission by NRS consumers to allow inter-plant transfer of coal: Certain plants from the Non-regulated Sector are often facing constraints due to restrictions on rake allocations and of coal movement via Road and RCR modes for Non-regulated Sector.

Also, coal stock at some plants remain alarmingly low due to lack of production/transport issues at the designated mines which eventually hampers the plant operations.

Submission has been given to the Ministry of coal to allow interplant transfer of coal within the same company/business group (within different units of the same organisation) for high-

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er capacity plants in the Non-power Sector in line with the Power Sector as it wouldensure maximum lifting of booked Linkage/Exclusive e-Auction quantities, reduce dependence on imported coal and encourage the NRS consumers to go for more long-term Linkage/Exclusive Auction security.

8. Submission by NRS Consumers for change of mode from Rail to Road/ RcR: In order to ensure uninterrupted generation of electricity across the country, coal supply to the Power sector has been prioritized. As a result, rakes allotted to many successful bidders from the Non-power sector in the recently conducted Spot e-Auctions are getting delayed indefinitely.

Request has been made to the Ministry and CIL to allow the NRS consumers to opt for change of mode for coal transport temporarily from Rail mode to Road mode as well as Road cum Rail (RcR) mode if the allocation of rakes is delayed beyond 90-days period.

With Best Compliments From:

Sharda Ma

Logistics Pvt. Ltd. ( )

COAL MERCHANTS, IMPORTERS HANDLING AGENTS Handling and Transportation of Coal&both

by Rail and Road and also via Rail cum Road mode from SECL INDIA and SOUTH INDONESIA SINGAPORE HONG NIGERIA otherAFRICA Subsidiary Coal Companies of Coal IndiaKONG Limited

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UGF 1& 2, Kanchenjunga Building, 18 Barakhamba Road, New Delhi-110001, India - 110095 P : +91 11 23354046/47Shakarpur, F Delhi : +91-11-23354047 E : corporate@shardamaa.com W : www.shardamaa.com Phone: +91 1141 510 186, Email: nj@shardamaa.com

POWER Column: India's coal electricity shortages ease

and

India's coal shortage and electricity blackouts have eased in recent weeks as the seasonal decline in power demand has enabled generators to rebuild depleted coal stocks and the grid to operate with greater stability.

The grid's ability to meet power demand was stretched to breaking point in October by a combination of strong underlying growth in demand, the seasonal peak, and fuel shortages, which forced many generators offline. But the seasonal decline in power demand as temperatures have cooled since then has allowed generators to rebuild stocks and helped improve

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the grid’s margin of spare capacity.

Coal stocks at power stations have climbed to 13.7 million tonnes, up from just 8.1 million at the end of September, though still far below the level two years ago of 21.2 million.

Power generators' stocks are now sufficient for around 8 days of current consumption, up from just 4 days at the end of September, according to the Central Electricity Authority.

Stocks are still rated critically low at 63 out of a total of 135 plants, but the number is down from 116 in mid-October, and those plants account for 75 Gigawatts of capacity, down from 142 GW last month.

Power plants imported 47% less Peak power demand deficit alcoal in April-August most wiped out, in 2020-21, says Indian power plants imported 47% less coal Union power ministry during April-August this year compared to the period last year due to high prices of the fuel in international markets. During FY 2021-22 upto August 21, the imports of non coking coal used mainly in the power sector decreased to 15.24 MT from 28.69 MT during the same period of FY 2019-20.

Due to substantial reduction of import of Non Coking Coal in the current year, the total import of coal has also reduced to 94.15 MT in the period from April to August 2021 compared to 107.01 MT during the corresponding period of FY 2019-20, a decrease of about 12%.

In the first five months of the financial year 2021-22 up to August 2021, the import of all varieties of non coking coal reduced to 70.85 MT from 84.44 MT during the corresponding months of the financial year 2019-20 representing a decline of about 16.09%.

Electricity provided in every village, home in India: Power minister R K Singh Union power minister R K Singh claimed the government has provided electricity in "every village and every house" in the country and if any settlement or home remains untouched, officials should be informed about it.

The Minister of Power and New & Renewable Energy said the Centre has set up 1.59 lakh km long power grid and provided electricity in every household.

Madhya Pradesh is fast heading towards generating 50 per cent of the country's total energy requirement through solar source as per Prime Minister Narendra Modi's target of achieving that goal by 2030.

He said MP is generating 22,000 MW of electricity per day. The government is generating power from all available sources, including water (hydro), coal ((thermal), air (wind) and sun (solar).

The Union power ministry has said that peak power demand deficit in the country was almost wiped out in 2020-21 period. Providing statistics, the ministry said the deficit stood at 0.4 per cent in 2020-21 compared to 16.6 per cent in 2007-08 and 10.6 per cent in 2011-12.

In the current year (2021-22) till October, the peak power demand has been (-)1.2 per cent and the marginal spike was attributable to the annual post monsoon pressure on power output. This is also likely to normalise by the end of the year, the ministry said in a statement. According to the statement, India had a massive power deficit of 16.6 per cent in 2007-08 and in 2011-12, it was 10.6 per cent.

Through the multi-pronged, comprehensive and aggressive interventions of the government, this deficit is near about wiped out, consistently over the last three years -- 0.4 per cent in 2020-21, 0.7 per cent in 2019-20 and 0.8 per cent in 2018-19, the statement said.

This transformation from an acutely power deficit country to a situation of demand being met, except for an extremely marginal shortfall of less than 1 per cent, has been made possible by the schemes brought in by the current government to address the unhappy situation, it noted.

R K Singh asks officials to focus on storage of surplus energy Power Minister R K Singh has asked senior government officials central PSUs, renewable energy developers, PSP developers and battery manufacturers to focus on the storage of surplus energy in the country.

The minister emphasized that the objective should be to ensure that no energy is lost. "For that, we need to be in a position to store all the energy, which is going to be surplus at any point of time."

Singh stated that some storage needs to be added with the generation to ensure round-theclock renewable energy.

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He further directed to prepare separate guidelines on the treatment of energy storage and resource adequacy.

distribution companies (discoms) to pay higher tariffs to power plants as soon as the cost of fuel escalates.

To meet the target of 500 gigawatt (GW) renewable energy by 2030, the minister directed to work out the requirement of storage capacity year-wise in keeping with the upcoming addition of solar and wind projects.

The move is seen to cut the delays traditionally seen in the process of vetting power costs and improve the liquidity position of power generators. However, a fallout of the move could be a further rise in discoms’ losses, if the end consumers are spared from the burden, under political pressure.

Power Ministry asks states to provide for automatic pass through in tariff change in costs The Power Ministry has asked states to provide for automatic pass through in tariff change in costs on account of change-in law or power purchase costs. This will result in less working capital requirements by the discoms, leading to less costs of power for the consumers.

The ministry also stated that state government have the powers to give subsidy in consumer tariff, by advance payment of subsidy to distribution companies under Section 65 of the Electricity Act. The state commissions are requested to place the mechanism in operation with immediate effect.

Along with this, the ministry has asked all stakeholders in the power sector value chain to ensure timely recovery of cost, which involves the cost pass through by generating companies to the distribution companies, or discoms, and from the discoms to the consumer.

Section 62(4) of the Electricity Act provides that tariff or part of any tariff can be amended more frequently than once in any financial year in respect of any changes expressly permitted under the terms of any fuel surcharge formulae as may be specified.

State discoms to pay higher power tariffs if fuel costs spike In a move aimed at ensuring timely compensation to power generating companies for any post-contract spike in fuel costs, the Union power ministry has asked state electricity regulators to adopt an ‘automatic pass-through model’, which will require the state-run power

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The step was taken by the power ministry after assessing the recent coal crisis scenario in the country, when many power plants had run short of the fuel. Private power plants have to pay for the fuel in advance to coal companies, and low liquidity prevents them from keeping adequate stocks at the generating stations.

8,982 crore released for payment of subsidies to DISCOMs The State government has informed the Legislative Assembly that it had released 8,982 crore for the 2020-21 and 2021-22 financial years (4,230 crore and 4,752 crore respectively) towards the subsidies payable to the power distribution companies (DISCOMs).

A sum of 13,390 crore is due to the DISCOMs towards subsidies on power connections to the agriculture and aquaculture sectors and Scheduled Castes and Scheduled Tribes (SCs and STs) and arrears. In total, 12,812 crore has been sanctioned to them through budget release orders for 2020-21 (6,709 crore) and 2021-22 (6,103 crore).

The government said that 74.75% of the headworks of the Polavaram irrigation project and 20.19% of the land acquisition and relief and rehabilitation works were completed.

The government pegged the total expenditure incurred on Polavaram project till November 16, 2021 at nearly 18,341 crore and the total funds released by the Centre through the Polavaram Project Authority was put at approximately 11,493 crore.

PM Modi welcomes US International Solar Alliance

to

Prime Minister Narendra Modi welcomed the US joining the International Solar Alliance (ISA) and said this will further strengthen the alliance in its shared quest of harnessing solar energy for a sustainable planet.

The United States became the 101st member country of the India-led International Solar Alliance (ISA), as US Special Presidential Envoy for Climate John Kerry signed the ISA framework agreement to catalyse global energy transition through a solar-led approach.

This will further strengthen the alliance in our shared quest of harnessing solar energy for a sustainable planet, Modi said.

Ministry of External Affairs Spokesperson Arindam Bagchi said on Twitter, "More power to solar! A very warm welcome to USA as it joins the International Solar Alliance at COP26. With this, USA becomes the 101st country to sign the framework agreement of the solaralliance.”

No transmission charge waiver for green power projects from July 2028 In a move that can be seen to expedite the installation of renewable energy projects in the next few years, the Union power ministry has said that 100% inter-state transmission (ISTS) charge will be waived off power supplied by solar and plants commissioned on and after July 1, 2028. Currently power distribution companies (discoms) do not have to pay ISTS charges for solar and wind-based electricity, and the waiver was used as an incentive to encourage renewable power capacity addition.

The government has also relaxed the norms for availing ISTS charge waivers for hydro pumped storage plant (PSP) and battery energy storage system (BESS) projects. Earlier, these projects were eligible for waiver benefits only if at least 70% of the electricity used by these systems are

supplied from wind or solar power plants. Now, they can get the benefits even if they source if at least 51% of the electricity from wind or solar projects. ISTS transmission charges shall be waived for solar, wind and PSP projects for 25 years from their commissioning, while BESS projects can avail the waiver for 12 years only.

Green hydrogen plants, commissioned within July 30 2025, will also receive ISTS charge waivers for the first eight years of their operation. Renewable energy-based electricity being traded in the spot power markets (green dayahead and green term-ahead) will also be entitled to ISTS charge waiver till July 30, 2025.

India's state coal companies target installing 5.56 GW renewable power by 2030 India's state-run coal companies are aiming to install 5.56 GW of renewable power capacity by 2030 and take other measures designed to cut CO2 emissions in line with recent pledges made at the UN Climate Change Conference in Glasgow, the Ministry of Coal said in a statement.

The renewable capacity additions planned by India's largest coal miner Coal India Ltd. and its subsidiaries, along with other state-run coal miners Singareni Coal Company Ltd. and NLC India Ltd., will see an investment of over Indian Rupees 150 billion ($2.02 billion) by 2030, taking their combined installed renewable capacity to 7 GW. India's zero-carbon generating capacity renewables, nuclear and hydro power -- stood at 156.35 GW at the end of October, representing 40% of national capacity of 390.79 GW, according to the New and Renewable Power Ministry.

India had a solar power capacity of 45.61 GW and wind power capacity of 39.69 GW at end August.

India has pledged to raise its renewable capacity target from 450 MW to 500 GW by 2030 and cut its emissions intensity per unit of GDP by CCAI Monthly Newsletter November 2021

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45% by then from 2005 levels. It has also set itself a net zero target for 2070

Indian government expands budget for PV manufacturing scheme Bidders who failed to win projects under the Indian government’s production-linked incentives scheme for solar manufacturing still stand a chance to secure funding, because the authorities are providing US$3.2 billion (AU$4.3 billion) of additional funding for the subsidy program.

Power Minister RK Singh said that the government has approved the ministry’s proposal to expand funding. The additional funds will help more manufacturers under the incentives scheme, paving the way for India to become a solar panel manufacturing hub and exporter.

Jindal India Solar, Shirdi Sai Electricals and Reliance New Energy Solar have already secured funds under the incentives scheme to support gigawatt-scale production of high-efficiency solar modules. Other companies – including Adani Infrastructure, First Solar, Coal India, Larsen & Toubro, Renew Solar, Tata Power, and Waaree Energies – are on the waiting list to obtain similar support.

Singh said that at present, India has a solar module production capacity of 8.8 GW and cell capacity of 2.5 GW. The incentives scheme tender drew bids for 54.5 GW of solar equipment production capacity.

Govt plans to install 6,000 charging stations across 9 expressways: Mahendra Nath Pandey The government is planning to install 6,000 charging stations for electric vehicles across nine expressways in the country, said Dr Mahendra Nath Pandey, minister of heavy

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Industries at Automotive Research Association of India (ARAI). He also asked ARAI to develop technology to reduce charging time.

According to the minister, the sale of EVs in India has increased drastically in the last few months due to various schemes and subsidies provided by the government. “However, there are various challenges that we have to counter, including the price and the charging infrastructure.

Pandey emphasised on the government’s FAME (Faster Adoption and Manufacturing of Hybrid and EV) scheme I and II which has been extended by another two years to March 31, 2024. “The production-linked incentive (PLI) scheme will lead to an investment of ₹42,500 crore and will further accelerate manufacturing of components and batteries in India.

Considering the increase in the usage of drones in the coming years for various applications, the ministry of heavy industries has sanctioned 120 crore for research and other related work in this regard

Gujarat Will Become India's Renewable Energy Capital By 2025 Gujarat Chief Minister Bhupendra Patel has said that the state will consolidate its position as the renewable energy (RE) capital of India by 2025.

Pointing at the development initiatives taken by the state government, Patel said, "Gujarat's development will witness many mega infrastructure projects and one such megaproject is Dholera, India's First Greenfield Smart City. A fin-tech hub is being set up and incentives for aircraft-leasing companies are being given.

Gujarat will soon become a renewable energy hub. By 2025, Gujarat will consolidate its position as the renewable energy capital of the country."

As per the estimates by the state government, Gujarat's renewable energy power generation

capacity, carried by policy initiatives and support from good investors is expected to escalate to 38,466MW by 2025.

within 'Island Coastal Regulation Zone' in bigger islands with geographical areas of more than 100 sq. km.

As per the state Energy and Petrochemical Department, Gujarat's present cumulative installed power generation capacity from renewable energy sources like solar, wind, biomass, and bagasse is about 13,152 MW

The environment ministry has, to this effect, issued two draft notifications. Final decision would be taken on this after mid-January next year after analysing suggestions and views of stakeholders including environmentalists and local residents in the next two months.

Government issues list of modules & manufacturers eligible for its projects In yet another boost for India's domestic solar manufacturing industry, the government has issued an all-Indian list of modules and manufacturers to be used for its projects.

This approved list of models and manufacturers (ALMM) released by the Ministry of New and Renewable Energy (MNRE) comes a day after the announcement of the much-awaited basic customs duty on Chinese solar imports.

Only the 23 manufacturers and their vetted modules included in the list will be eligible for use in government and government-assisted projects, schemes, and programmes for projects bid-out on or after April 10, 2021, the notification said.

The basic customs duty (BCD) will be imposed on solar modules and cells, which will attract a 40 per cent and 25 per cent charge respectively.

Already bid-out projects will not be exempted from the BCD, the ministry had clarified

Gas-based power plants to be allowed in coastal regulation zone in Andaman & Nicobar Islands Seeking to meet energy requirements of the islanders while reducing the dependency of Andaman & Nicobar Islands on highly polluting diesel-based power generation, the Centre has proposed allowing gas-based power plants

Besides providing cleaner energy to islanders at a low cost, the move also assumes significance in view of India’s attempt to augment its strategic capabilities by improving infrastructure in the region against the backdrop of China’s 'One Belt One Road initiative' and its naval outreach.

India needs to tap hydro resources to achieve 500 GW RE capacity target: R K Singh In a bid to achieve the target of installing 500 GW (giga watt) renewable energy capacity by 2030, India needs to tap its hydro resources, Union Minister R K Singh has said.

The Minister has directed NHPC to exploit hydro resources in the country to become one of the largest hydro power companies in the world.

The Minister said that the projects which were stalled for long before being resumed recently. The 2,000 megawatt Subansiri lower hydroelectric project (in Assam and Arunachal Pradesh) is progressing well. In Dibang (dam), all hurdles have ended and 3,000-MW project will also begin.

NHPC Ltd presently has an installation base of 7071.2 MW from 24 power stations including 2 projects in JV mode. Besides, the company is also making progress in the solar and wind energy sectors. It has commissioned 103.13 MW of solar, rooftop solar and wind energy projects at various locations in India.

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DOMESTIC Coal will continue to feed growing energy need of India for next five decades: Experts

ue investment in coal mines and infrastructure going forward, else we will face fuel side challenges like in October," Debasis Mishra, partner at Deloitte Touche Tohmatsu in India said.

Given India's dependence on coal for 70% of the power sector's need, the 50% non-fossil fuel sourcing by 2030 itself will be quite challenging and coal will continue to feed the growing energy need of India for the next five decades, according to industry experts.

India’s thermal coal capacities are increasing from current 210 GW to 267 GW projected by CEA by 2030. Also there will be retirement of old capacities. Therefore, while coal share may go down but it terms of quantity and in terms of capacity it will perhaps go up from the current levels.

Coal will continue to feed the growing energy need of India in next five decades and only going to peak in the 2040s- hence we need to contin-

18 | CCAI Monthly Newslette November 2021

Imported energy may be the first casualty compared to domestic coal. "However, the fourth

commitment related to reducing energy intensity of the economy so sharply, will pose a challenge for steel, aluminium and cement sectors.

Coal's demise is not a foregone conclusion, especially in the power sector. What happens to coal will be a function of India's growth, overall energy demand in India, Niladri Bhattacharjee, Partner, Metals & Mining said.

He further handed over 52 mineral blocks to various State Govts in the 5th National Conclave On Mines And Minerals today. These G4level blocks have been identified by the Geological Survey of India and can be put up for auction

by States.

These mineral blocks are located across 15 States, comprising several types of mineral deposits.

CIL despatches grow; coal stocks rise Coal mines auction: Govt devises Coal India Ltd (CIL) despatched a total of 364.4 plans to seek interests, participamillion tonnes (MTs) of coal during the first tion of private sector seven months of the ongoing fiscal, the highest ever for this period so far, posting 19% growth over corresponding period last year, a senior company official said.

The increase in volume terms is 58.6 MTs compared to 305.8 MTs of same period last fiscal.

Overall coal supplies for October’21 reached 56.7 MTs with nearly 12% jump against October of last year when the despatch was 50.7 MTs. During the last week of October, the average per day stock accumulation at thermal power plants has been over 3 Lakhs tonnes touching almost 4 lakh tonnes on four days. Against coal consumption of around 1.8 MTs per day, by the power sector, the supply from CIL and other sources has been around 2.2 MTs during the last week of October.

On October 28, CIL’s despatch to power plants peaked to 1.8 MTs the highest ever recorded for a single day since the inception of the company.

CIL expects to further boost up the stocks to 12 MTs by Diwali.

In view of acute requirement of dry-fuel in downstream sectors, the government has laid down a plan to auction coal blocks which will also be a major boost for increasing the revenue streams for the mine bearing states.

The development assumes significance in the wake of the Ministry of Coal launching the third round of commercial coal mining for 88 coal mines last month.

The coal ministry is planning to organise road shows in different parts of the country to create sensitisation on the amendments made in Acts and Rules and generate private sector interest and participation.

These road shows will be organised in Ranchi, Hyderabad and Ahmedabad, according to a notice by the coal ministry. In this regard, the Ministry of Coal will appoint a Programme Management Partner to organise and manage this event successfully.

The country has an estimated 350 billion tonnes of coal deposits, which is third largest in the world. However, 25 per cent of coal demand is still catered through imports.

Coal Minister announced reimbursement of transaction advisor fee for mineral auctions Coal gasification: Ministry proUnion Coal Minister Shri Pralhad Joshi adposes tax sops for syngas tech; dressed the 5th national conclave on mines and minerals on November 23, 2021. At Na- 15% methanol blending with pettional Conclave he announced reimbursement rol of transaction advisor fee for mineral auctions.

100% transaction advisor fee to be reimbursed in case of successful auctioning 50% fee to be reimbursed in case of unsuccessful auctioning

A blueprint for the ‘National Coal Gasification Mission’ prepared by the Union coal ministry has proposed 15% methanol-blending target with petrol to encourage investments in the CCAI Monthly Newsletter November 2021

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sector. It also proposes massive tax waivers to incentivise coal gasification, which can lead to eco-friendly alternate utility of the fuel abundantly available in the country.

Prime Minister Narendra Modi had said in June 2020 that Rs 20,000 crore will be invested in coal gasification projects by 2030 to utilise 100 million tonne of coal.

Most of India’s known coal deposits are nonrecoverable. Underground coal gasification could help extract those plentiful reserves that are deep, scattered and covered by forests. Coal can be gasified to turn it into a cleaner syngas or synthesis gas—a mixture of hydrogen and carbon monoxide — which constitutes the basic building block of the chemical industry and can be converted into a wide range of downstream products such as methanol and olefins of which India is at present a net importer. The syngas technology allows conversion of non-mineable coal/lignite into combustible gases through in situ gasification of the material.

The mission document, reviewed by FE, pointed out that if levies such as GST compensation cess and additional duties on coal are removed, the tentative reduction on aggregate price of methanol may be in the range of Rs 1,450-1,650 per MT

before interest, taxes, depreciation, and amortisation) and the increased capex of the miner, the chairman said that the mining industry is not like any manufacturing entity in which an increase in capital expenses will translate into higher EBITDA

Coal India consolidating its sustainable development goals: Govt The government said state-owned Coal India Ltd (CIL) is quietly engaged in further consolidating its sustainable development goals.

In many of the backward and remote hamlets of the country, CIL and its subsidiaries are bringing about tangible improvements in basic amenities and the living standards of the villagers, the coal ministry said in a statement.

Eastern Coalfields Ltd (ECL), one of the subsidiaries of CIL, is further strengthening the hands of the PSU to provide solar energy, other environmental friendly amenities and quality education facility in the remote villages of Purulia district of West Bengal.

CIL, being aware of its role in sustainable development in coal mining, decided to take up the challenge in converting 38 villages of Neturia Block into a model, it added.

"Coal India Aims 40,000-Rs 50,000 Crore Capex In Next 4-5 Joshi asks CIL to make efforts to ensure 18 days stock with power Years": Chairman State-run Coal India has recently said that the plants by Nov-end company is aiming at investing 40,000-50,000 crore as capital expenditure in the next 4-5 years. The 17,000-crore capital expenditure for the current fiscal is "on track", said Coal India's chairman Pramod Agrawal, according to news agency PTI. He also highlighted that the price revision is "inevitable" and may happen soon.

"We have spent 7,000 crore capex so far and our 17,000-crore target for the current fiscal is on track. We will invest around 40,000-50,000 crore in the next 4-5 years. Most of the incremental capex will go into coal production and evacuation'', he said.

On the mismatch between EBITDA (earnings

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Union minister Pralhad Joshi asked stateowned Coal India Ltd and its subsidiaries to make all out efforts to ensure at least 18 days of coal stock with thermal power plants by the end of the month.

He directed the CMDs of coal PSUs to formulate revised targets and detailed strategy to attain this goal.

The minister pointed out that international coal prices have increased more than three times recently which resulted in 38 per cent decrease in coal imports to India. At the same time, electricity demand has gone up by more than 24 per cent indicative of robust economic growth.

CIL had stepped up the fuel supply to meet the increased demand of the power sector and arrest shortages at thermal power plants caused due to the rising cost of the imported coal. As per a report of the Central Electricity Authority (CEA), the coal stock with power plants stood at 9.03 million tonnes as of October 26.

Coal India's price hike plan likely to be delayed Coal India's plan to raise prices, which has been pending for some time, is likely to be delayed further as the mining major has failed to secure the nod of key stakeholders amid an outstanding of Rs 24,000-25,000 crore pushing the company in a tough situation, a source close to the development said.

The agenda of price hike is unlikely to be placed before the upcoming board meeting on November 12 as the board has not yet received the goahead from important stakeholders in the wake of the chaos of coal shortage since last month, though the global price of coal had risen significantly.

Unrestricted supply of the dry fuel amid crisis in power plants has resulted in a further jump in dues that has already reached around Rs 24,000-25,000 crore.

Coal dispatch to the power sector has increased by 27.13 percent to 59.73 million tonnes in October, owing to a spurt in power demand amid an unprecedented rise in import prices. The coal major was attempting to reach 2 million tonne per day production but till November 6 the average production was 1.6 million tonne.

Coal India, other production units set to ramp up output as imports decline Coal India and other coal producing units are all set up to ramp up domestic production as the country has reduced its dependence on imports for non-coking coal. The Coal Ministry said in a statement that although coking coal is nonsubstitutable, India has substantially reduced the imports of various grades non-coking coal during the current financial year.

21 | CCAI Monthly Newsletter May 2021

The country has reduced imports of high gross calorific value (GCV) thermal coal meant for industrial purposes and low GCV coal for power generation, the ministry added.

Coal Ministry said it has not taken financial year 2020-21 for comparison purpose due to industrial production getting severely affected during this year because of Covid-19 related restrictions where the decline observed is 21 per cent.

The reduction of imports of low GCV of noncoking coal, which is mainly used in power sector, is even more significant, the ministry stated.

During FY 2021-22, up to August 2021, the imports of such grades of coal have decreased by about 47 per cent to 15.24 MT from 28.69 MT during the same period of FY 2019-20, it added.

Coal India deploys additional third party samplers to lessen grade slippage Even as quality issues have started cropping up with Coal India (CIL) enhancing supplies to the power sector, CIL says it has been able to achieve improved grade conformity even after the monsoons when there are increased chances of grade slippages.

As per CIL, till August this year the grade conformity was 63%, up from 60% during the same month last year. But a section of power engineers are of the view that power plants’ present average 7 days stock position with around 13.4 million tonne have a lot of basalt and soil mixed in it. Plants mainly linked with the ECL are facing the problem, though most of the mines in other CIL subsidiaries are basalt free.

The PSU miner has engaged two more globally reputed third party sampling and testing agencies including COTECNA Inspection India and SGS India to ensure lesser grade slippage.

This engagement has been done in addition to the existing agencies namely CSIR-CIMFR and Quality Council of India.

CIL ascertained the quality of supplies during the last fiscal, sampling and analysing 487 MT compared to 448 MTs in FY20. “Sampling to production was higher in FY21 and is likely to be higher at the end of the current fiscal, though CCAI Monthly Newsletter November 2021

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total production this fiscal is expected to surpass the FY20 level at 602 MTs,” the CIL executive said

in the first seven months 352 lakh tonnes of coal was produced with a growth of 60%, SCCL noted.

Captive coal output rises 35% in H1

In same period last year 156 million cubic meters of Over Burden (OB) was removed whereas in the same period this year in the first seven months 201 million cubic meters of OB was removed with a growth of 28%.

Coal production from captive mines have recorded an impressive growth rate of 34.8% year-on-year in the first half of the current fiscal year, with these blocks producing 33.2 MT of the key fuel. Though captive coal still constitutes only 10.5% of the total domestic coal production, recent steps by the government such as allowing sale of 50% captive coal in the open market will likely encourage these miners to ramp up production further.

Captive coal production has seen a steady rise since the nadir hit in FY16 due to the Supreme Court’s cancelation of 214 blocks in 2014, following an adverse CAG report that highlighted arbitrariness in allocation. In April-September this fiscal, the coal production by captive mines maintained the accelerated pace gathered in recent years, while the country’s overall coal output (read production by Coal India and its subsidiaries) declined.

Captive coal mines are increasing output at a time when scarcity of coal has led to electricity supply shortages across several states. The government claimed that the move to allow sale of 50% captive coal in the open market is likely to benefit over 100 captive coal and lignite blocks with over 500 MT per annum peak rated capacity.

Singareni Collieries Company Limited records 68% growth in coal transport The Singareni Collieries Company Limited (SCCL) has revealed that the company has achieved a record 68% growth in coal transport and 60% growth in coal production in the last seven months ending October in this financial year when compared with last year ensuring that there is no shortage of coal supply. that last year in the first seven months 220 lakh tonnes of coal was produced whereas this year

22 | CCAI Monthly Newslette November 2021

Target has been set to achieve 330 lakh tonnes of coal production and transport in the remaining five months.

STEEL

State panel begins groundwork for Deocha-Pachami coal project The state-appointed apex committee, formed a week ago to supervise pre-mining activities and initiate confidence-building measures among residents, has begun talking to stakeholders for acquisition of land for the Deocha-Pachami coal block in Birbhum.

Compensation will soon be announced for 3,012 families living in 24 villages and the package promises to be one of the most lucrative for any coal block land acquisition so far The Deocha-Pachami coal block, which has an estimated reserve of 2.1 billion tonnes, was allocated to Bengal by the Centre in June 2018.

Spread over 9.7km, the block in south-western Birbhum is estimated to bring an investment of Rs 12,000 crore.

The government has also proposed a feedback system to thrash out an action plan for development of infrastructure through social welfare activities. “Based on what people need, projects on healthcare, education, drinking water and sanitation and community infrastructure will be started,” said an official close to the development. The committee will also liaison with the block and district administrations.

Cheaper Coking Coal May Not Bring Cheer For Indian Steelmakers Just Yet

Prices of a key raw material in steelmaking have declined but that may not lift margin for Indian mills. Australian coking coal fell $50 a tonne over the preceding month to $383 in November, according to data released by SteelMint. That, it said, came as demand for the metallurgical coal and steel dropped in the world’s top consumer China, and production increased.

Input costs for Indian steel producers surged as a shortage of coal in the nation forced them to compete with other industrial consumers for supply. Domestic mills are paying more than four times the normal cost. However, the companies’ margin may not benefit much.

Any reduction in variable cost (coking coal) will be directly passed on to the consumers in the form of price cuts within a period of 45 days or two months. Coking coal prices have cooled to $360 a tonne from the peak of $430-plus levels—savings of $70 a tonne. But steelmakers would pass this benefit mostly in the fourth quarter. margin would remain steady, he said, adding the impact of a price rise would reflect only in the fourth quarter of the ongoing financial year.

A fall in global steel prices may impact domestic rates, dragging down realisation, or the average selling price per unit of the product. That would offset any benefit from reducing cost pressures. Indian hot-rolled coil export offers fell about $25 a tonne, weighing on buying sentiments, SteelMint said in a report..

Steel players increase prices by Rs 1,500-3,500 a tonne from Nov 1 Indian steel companies have raised prices across different grades of the alloy by Rs 1,5003,500 a tonne from November 1.

Following the hike, which comes on the back of hardening raw material costs, especially coking coal which all domestic companies mostly import, hot rolled (HR) prices are in the range of Rs 70,000 a tonne.

The increase had a rub-off effect on steel stocks which outperformed the benchmark in-

dices by a wide margin.

Sources confirmed that JSW Steel and Tata Steel, the country’s top two private steel makers, had raised prices for November both for the flat category, which goes into consumer durables and cars, and the long segment, which finds uses in the construction sector.

The latest round of hike comes after a brief period of lull during July-September. Steelmakers had intermittently raised prices in October both in the long (rebar) and flat steel (hot rolled and cold rolled coils) categories. However, despite the spate of hikes, Indian prices remain at a discount vis-a-vis United States and Europe but on a par with Asia, indicating domestic manufacturers will still be competitive vis-a-vis imports

CEMENT Cement price will rise as cost of coal is up, says India Cements The India Cements Ltd said price of cement would increase as every cement factory faces "pressure on cost" and the industry was suffering from the huge impact of rise in coal price.

"The rise in cost (of coal) has taken place the price of coal we were getting was about USD 70-80 per tonne and went up to USD 105; and from there it went to USD 135. Now, it is USD 250 per tonne," said vice-chairman and managing director of the cement-making company N Srinivasan.

Elaborating on this, he said the company was prudent as it has coal of about four lakh tonne which can produce 27 lakh tonne of cement clinkers. "We have four months of stock, but beyond that we are looking at the higher costs of coal. This will apply to everybody (every cement-maker) not only us (The India Cements)," Srinivasan, also managing director of the company, told reporters.

Noting that the rise in cost of coal affects cost of power generation and cost of fuel at the kilns, he said

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GLOBAL Coal Seaborne Trade on the Rise in 2021 as new Routes Emerge Seaborne coal trade has reversed the downward trend of the past couple of years, with 2021 so far being in positive territory. In a recent weekly report, shipbroker Banchero Costa said that “2021 continues to see a steady but consistent recovery in coal demand and therefore also trade. In the first 10 months of 2021, global seaborne coal trade increased by +5.1% y-o-y to 984.7 mln tonnes, from 936.7 mln tonnes in the January-October 2020 period.

However, this is still -9.1% down from the 1083.7 mln tonnes in JanOct 2019. The worst this year was in the first quarter, as 1Q 2021 recorded a

24 | CCAI Monthly Newslette November 2021

-8.6% y-o-y decline to 276.7 mln t, which was also a massive -12.6% down compared to the (pre-Covid) first quarter of 2019. In the second quarter of 2021, global coal loadings reached 297.0 mln tonnes, which was +8.2% y-o-y compared to 2Q 2020, and down -10.1 compared to 2Q 2019.

NE Asia coal prices jump on fiercer competition A cold snap across the northern hemisphere and fiercer inter-basin competition for fuel amid a decline in Russian natural gas deliveries to Europe supported coal prices across northeast Asia this week.

The decline in Russian natural gas deliveries along the 33bn m³/yr Yamal-Europe pipeline at the Mallnow entry point from Germany to Poland and colder weather across the northern hemisphere sent the gas market higher, with the price of solid fuels moving in tandem. Most of Argus' spot coal assessments rose on the week, although China-delivered prices slipped amid ongoing government interventions.

Argus assessed NAR 5,800 kcal/kg coal at $144.69/t fob Newcastle and $165.08/t cfr South Korea, up by $20.81/t and $17.15/t on the week, respectively.

In South Korea, state-owned Korea Midland Power (Komipo) reportedly purchased a Capesize cargo of NAR 5,400 kcal/kg Canada-origin coal at about fob $141/t on a NAR 6,080 kcal/kg basis for February loading.

Allegiance Coal announces first Black Warrior cargo contract Allegiance Coal Ltd has announced the completion of an agreement for the sale of Black Warrior’s first 80 000 t cargo to an Asian buyer.

While the company waits for a pilot coke oven test to be completed on the premium Mary Lee and Blue Creek Top coals, this sale comprising all Black Warrior coals plus other coals available for acquisition, enables us to get Black Warrior coal on to the seaborne market now to take advantage of the current price environment with an alternative product.

coal had departed from local areas in China every day from Nov. 1 to 15, marking an increase of around 10,000 trains, or 13.5 percent from last year, data from the China State Railway Group Co., Ltd. showed.

During the period, the daily average number of trains loaded with thermal coal reached approximately 62,900, surging 31.8 percent from the same period last year, according to the data.

By the end of October, the shipping company affiliated with China Energy, the main force for maritime transportation of coal in the country, had transported 170 million tonnes of coal this year, an increase of 25.6 percent from a year earlier.

Thermal coal futures have plunged more than 60 percent to around 800 yuan ($125) a ton from a historic high of nearly 2,000 yuan in midOctober, Zhu said. The state planner last month set an initial target of 1,200 yuan in its most direct intervention yet to cool the market for the key power-generating fuel amid the severe power crunch.

China coking coal futures leap on demand optimism Chinese coking coal futures surged more than 13%, boosted by improving sentiment in the property market and expectations of higher steelmaking demand at mills, although analysts are flagging risks on weak fundamentals.

China sees surge in coal transportation by rail, ship.

Financial regulators have told some banks to issue more loans to property firms for project development, in efforts to marginally ease liquidity strains across the industry, according to sources. Meanwhile, the industry expects increase in steel production in the coming months after curbing its output more than what authorities required.

The volume of coal transported by trains and ships in China saw a surge in October and November amid the country’s solid efforts to ensure stability in coal supply during this winter, official data showed.

The most-traded coking coal futures on the Dalian Commodity Exchange DJMcv1, for January delivery, powered as much as 13.5% to 2,170 yuan ($339.71) per tonne. They ended up 12.4% at 2,149 yuan a tonne.

On average, about 86,300 trains loaded with

Coke futures on the Dalian bourse DCJcv1

The price was agreed at a discount to high-vol B due to the untested nature of the coal pending results of the pilot coke oven tests. The laycan is 1 – 10 December 2021.

CCAI Monthly Newsletter November 2021

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China’s daily coal output stabilizes at 12m tons

Coal demand is also expected to decline in the future from a growing pressure to shift to renewable energy and the retirement of coalfired power plants to decrease greenhouse gas emissions. Because of this, the ESDM expects coal use to shift from a fuel source for power generation, to a carbon source for chemical products and carbon raw material.

China’s daily coal output has stabilized at 12 million tons, amid a raft of measures to ramp up power production, the country’s state planner said.

Indonesia 2022 coal consumption for power generation seen at 119 million T - state utility

jumped 4.8% to 3,050 yuan per tonne at close.

Benchmark iron ore futures DCIOcv1 extended gains after hitting a 10% daily trading limit and were up 5.8% to 617 yuan a tonne when market closed.

Beijing has been trying to cool a red-hot market for coal, China’s main fuel for power generation, after shortages led to electricity rationing for industry in many regions, adding to factory gate inflation in the world’s second-biggest economy.

Coal stocks at ports and power plants have been picking up quickly, with stocks in power plants hitting 129 million tons as of Nov. 14 and expected to hit 140 million tons by the end of November, said state media CCTV

Indonesia's 2022 coal consumption for for power generation is likely to reach 119 million tonnes, Zulkifli Zaini, CEO of the country's state utility Perushaan Listrik Negara (PLN) told parliament recently.

Coal demand by PLN itself is expected at 68.43 million tonnes next year, while 50.76 million tonnes next year, while 50.76 million tonnes is likely to be used by independent power plants, he said.

PLN Electricity Still Generated by Jakarta eyes higher revenue from Coal downstream coal use State-owned electricity company PLN is currently The Indonesian government is expecting a significant increase in state revenue once the country's downstream coal industry is developed. It has projected that collections from both non-tax and tax revenue from the industry will reach 136 trillion rupiah ($9.57bn).

Derivative products from the industry can replace imported goods, which could reduce foreign imports by up to Rp140 trillion, it said.

Indonesia's energy ministry (ESDM) said that the downstream coal market has the capability to be one of the largest industries in the country, given Indonesia's large coal reserves and a growing pushback against coal use as a power generation fuel. The ESDM said that the country has coal reserves of up to 39bn t and estimated resources of 144bn t. But most of this coal is low and medium grade product that fetches lower prices.

26 | CCAI Monthly Newslette November 2021

pushing to construct supporting infrastructures for electric vehicles (EV). However, the electricity production in Indonesia is still mostly generated by coal-fired power plants (PLTU), which continues to contribute to carbon emissions.

This was confirmed by PLN executive vice president of marketing and product development Hikmat Drajat. He said 60 percent of the company’s power plants are still composed of PLTUs and that producing electricity that eventually establishes the EV environment cannot be done in a short amount of time.

" The power plants that were built about 3 to 4 years ago were still predominantly PLTU, so that currently approximately 60 percent of the composition is still PLTU," said Hikmat at the IEMS 2021 exhibition, November 25.

However, he assures that the company is halting the use of coal-fired power plants and is starting to turn to renewable energy power plants through its geothermal power plants or PLTP

Australia’s Whitehaven Coal hit with blasting ban Australian producer Whitehaven Coal has stopped blasting at its 13mn t/yr Maules Creek thermal and semi-soft coking coal mine in the Gunnedah basin after the New South Wales (NSW) Environmental Protection Authority (EPA) issued a prevention notice.

The company is only allowed a maximum of six blasts between 18 November and 13 December and only if it is approved by the EPA under the recommendation of an independent export, according to the prevention notice.

Whitehaven has appointed an independent expert to investigate concerns that its blasts are releasing excessive volumes of oxides of nitrogen. It said that overall production at Maules Creek will stay within guidance over the 2021-22 fiscal year to 30 June.

It did not comment on the more immediate impact of the blast ban on export sales through the port of Newcastle, although it is likely to be lower over the remainder of 2021.

Entrepreneurial coal firms that picked up projects or old mines over the past few years of depressed metallurgical coal prices are already moving ahead with restart projects, like the 1mn t/yr Gregory-Crinum and 1.2mn t/yr Bluff mines in Queensland. Others paused during the Covid-19 pandemic are reinvigorated and pushing toward construction or final approval, such as the 3.5mn t/yr Tahmoor South extension and the 15mn t/yr Olive Downs mine with a stage one phase of 4.5mn t/yr.

A new generation of Australian mid-tier firms are developing, with Stanmore taking on UK-Australian mining firm BHP's 80pc stake in the BHP Mitsui Coal (BMC) joint venture, Pembroke pushing forward with Olive Downs, Bowen Coking Coal aiming for 5mn t/yr of mined coal in 2024 and Fitzroy Australia reopening the 1mn t/yr Broadlea mine and starting construction of its 2.7mn t Ironbark No.1 project this year.

These firms could replace the mid-tier firms Gloucester Coal, Macarthur Coal and Felix taken over by Glencore, Peabody and Yancoal respectively around 2010 when coal prices were higher than average.

QRC: Queensland’s high-quality Anglo CEO expects investor supcoal industry here for the long port for plan to keep ‘met’ coal Anglo American, which divested its thermal coal haul Queensland coal producers are willing and able to meet the challenges of modern-day mining and will be operating for decades to come as the world turns its attention to using higher-quality, lower carbonemitting coal, the Queensland Resources Council (QRC) has said.

QRC Chief Executive, Ian Macfarlane, said having a superior, in-demand product backed by an industry already embracing renewable energy in its operations and heavily investing in low emissions technology will ensure the long-term future of the state’s AUS$28 billion annual export industry and the 300 000-plus Queensland jobs it supports.

“Queensland coal mines should be the last coal mines closed in the world because it’s the best quality coal there is, and that goes for our thermal and metallurgical coal,” Macfarlane said.

“The world needs Queensland coal more than ever to support the transition to a cleaner, greener and more sustainable future

mines this year after pressure from investors, plans to retain its steelmaking coal portfolio as it is confident that they will not press for an early exit, the mining group’s chief executive said.

Anglo spun out its South African thermal coal operations and sold its stake in a Colombian mine to Glencore GLEN.L after shareholder calls to ditch the more polluting fossil fuel to meet emissions targets.

However, the price of thermal coal, which is burned for steam to produce electricity, rose as high as $280 a tonne in the second half of 2021 from as low as $57 in 2020, generating strong returns for the new owners.

Anglo also produces metallurgical, known as ‘met’, coal and iron ore, which are key ingredients in steelmaking. Emissions from steelmaking account for up to 9% of the global total and producers are pushing to develop technology to meet global climate commitments.

South Africa Sued Over Plans to New generation of Australian Construct New Coal-Fired Power Plants coking coal emerges CCAI Monthly Newsletter November 2021

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South Africa’s energy regulator and energy minister have been sued by environmental activists over national plans to allow the construction of new coalfired power plants.

Plans for the construction of 1,500 megawatts of coal-fired generation capacity are included in the 2019 Integrated Resource Plan for Electricity and a ministerial determination passed on Sept. 25 last year.

“New coal-fired power flies in the face of our constitutional right to an environment not harmful to health and wellbeing, not only for the present generations but for future ones too,” Nicole Loser, Programme Head: Pollution and Climate Change at the Centre for Environmental Rights, a legal group representing the activists, said in a statement

US coal prices jump to highest level since 2009 US coal prices have jumped to their highest level in more than 12 years as the industry scrambles to keep pace with surging demand driven by power producers switching to the heavily polluting fossil fuel.

coal miners and associated sectors, for favoring the industry. For President Joe Biden, fresh off of international climate talks in Scotland, the lapsing of the National Coal Council’s charter may be an opportunity to signal to climate hawks his desire to evict coal, a fuel with high greenhouse gas emissions, from the U.S. power system.

Outlook for Canadian coal ‘stronger’ in a de-carbonised future: North Coal CEO The new chief executive officer of North Coal took the opportunity to talk up his company’s confidence in the future of metallurgical coal during a presentation to the District of Sparwood council this week.

North Coal’s development project, the Michel Coal Project, is located to the south east of Sparwood, and is envisioned as a 2 million tonne per year mine with a lifespan of around 25 years. The company projects it would create 500 jobs during construction, and 300 full-time jobs upon completion. It is currently undergoing regulatory assessments, and the company hopes to begin construction in 2025.

The spot price of coal in the Central Appalachian region — a benchmark for the eastern US thermal coal market — jumped by more than $10 last week to $89.75 per short ton, the highest level since 2009, according to data released from S&P Global.

Ian Maxwell, who has recently taken over as CEO, said that given the current climate and thinking about coal in the aftermath of the 26th United Nations Climate Change Conference (COP26) in Glasgow, “it’s become very clear that there are mixed views on the outlook of coal.”

The use of coal has rebounded, driven by stronger electricity demand and a doubling of natural gas prices this year, leading some power generators to switch to the fuel. High international prices have also propelled US coal exports.

Colombia sees coal output recovering 20% in 2021 – minister

Four-decade-old US coal advisory council hours may be numbered A nearly 40-year-old coal advisory council to the U.S. federal government will cease to exist as of Nov. 20 if the Department of Energy does not take action — and the agency has been silent on the body’s fate.

Congressional Republicans sounded the alarm on the potential loss of the charter with a letter in October proclaiming the need to preserve the volunteer group. The council, founded in 1984, advises the Secretary of Energy on federal policies that affect coal production, marketing and use.

Environmental groups have long criticized the council, whose members are largely representatives from

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Colombia’s coal output could recover some 20% in 2021 versus last year, Mines and Energy Minister Diego Mesa said, adding that the government expects to award enough blocks in an upcoming oil auction to meet its four-year target.

Coal is a major source of income for Colombia, where production dropped 40% in 2020 to 49.5 million tonnes – an average of just over 12 million tonnes per quarter – due to the twin crises of the coronavirus pandemic and a 91-day strike at major mine Cerrejon.

The South American country, a major world producer, saw quarterly coal production before the pandemic of close to 19 million tonnes and is now seeing output of around 13.7 million to 14 million tonnes, Mesa said in an interview with Reuters.

MONTHLY SUMMARY OF IMPORTED COAL & PETCOKE Indicative Imported Coal Price COAL South Africa South Africa Australia Indonesia Indonesia

(kcal/kg) 6000 NAR 5500 NAR 5500 NAR 5000 GAR 4200 GAR

Monthly Price - FOB USD 142.25 USD 114.51 USD 114.76 USD 121.33 USD 85.74

Monthly Price- FOB INR 10595 INR 8528 INR 8548 INR 9037 INR 6386

Monthly Change (USD) -67.50 -55.89 -42.12 -64.73 -55.74

Indicative Pet Coke Price PET COKE

Sulphur

Price

India-RIL(Ex-Ref.) Saudi Arabia (CIF)

-5% + 8.5%

INR 20781 INR 15920 ($214)

Monthly Change ($) INR 4421.00 -6.25

USA (CIF)

- 6.5%

INR 16479 ($221)

-6.75

Exchange Rate

Change (Monthly)

INR 74.48

-0.56

Indicative Coking Coal Price Current Month

Premium Low Vol FOB CFR China 371.94 497.00

Monthly Change (USD)

-27.03

-114.35

HCC 64 MID Vol Semi Soft Low Vol PCI Mid Tier PCI MET COKE 62% CSR FOB Aus CFR China FOB Aus FOB Aus FOB Aus CFR India FOB N China 310.13 431.25 214.89 255.63 234.69 627.38 580.75 -24.72

-106.69

South African Coal News: * Key South African government ministers have reached a broad agreement to sell some of the state power utility Eskom’s coal-fired power plants to help reduce its debt burden. Eskom supplies almost all of South Africa’s electricity, most of it from coal-fired plants. The South African government has said in the past that it’s been approached by investors interested in buying its coal-fired plants, without identifying them. * South Africa’s plan to build new coal-fired power stations during the climate crisis is being challenged in court for breaching the rights of current and future generations. Three civil society organisations have launched a constitutional lawsuit in the North Gauteng high court against the South African government,

30 | CCAI Monthly Newslette November 2021

-58.62

-19.94

-39.88

11.63

-63.75

arguing that its energy policy is incompatible with the national constitution. *South Africa’s plan to build new coal-fired power stations during the climate crisis is being challenged in court for breaching the rights of current and future generations. Three civil society organisations have launched a constitutional lawsuit in the North Gauteng high court against the South African government who intends to add 1,500MW more over the next six years as part of its 2019 integrated resource plan. *Indian industrial major Jindal Steel and Power Ltd (JSPL) will construct a coal mine in Botswana's Mamabula coal fields in 2022 to cater to the export market and supply a planned coal-fired power plant. JSPL's African arm aims to produce 4.5 million tonnes of coal annually from the upcoming mine.

Australian Coal News:

* Australia said it will sell coal for "decades into the future" after spurning a pact to phase out coal in the recently concluded COP26 UN climate summit in Glasgow. Defending Australia's decision, Australian Minister for Resources Keith Pitt said Australia had some of the world's highest quality coal. He said Demand for coal in the global market is expected to rise until 2030. * Australian Prime Minister Scott Morrison said the coal industry will be operating in the country for “decades to come,” in response to British Prime Minister Boris Johnson’s remarks that the agreement reached at the COP26 climate summit in Glasgow, Scotland, sounds “the death knell for coal power.” He said Australia has a balanced plan to achieve net zero emissions by 2050, but his Government is not going to make rural and regional Australians pay for that. * Overcoming the downturn of last year following the Chinese import ban, the Australian coal market has witnessed a steady upswing in 2021 which is further boosted by the release of pre-ban Australian cargoes. Last month, Beijing allowed the discharge of Australian coal cargoes that arrived before the ban helping imports of 777,915t of coal to be released into China, according to customs data. As a result, High-CV Australian coal prices have gone up by nearly A$50 in October compared to the previous month.

Indonesian Coal News:

* Indonesia, the largest exporter for thermal coal, is placing a limit to the price of coal sold to local cement and fertilizer plants to help them weather the impact of surging global prices.

The price is set at $90 a ton for coal with a gross heating value of 6,322 kilo calories a kilogram, Ridwan Djamaludin, director general of minerals and coal at the Energy and Mineral Resources Ministry has revealed. The relevant ministerial decree has been issued in this regard. * The Government of Indonesia has issued a

regulation to implement the recent amendments made to the Mining Law which seeks to strike a balance between mineral and coal mining business. Principally, this new regulation regarding the Operation of Mineral and Coal Mining Business ("GR 96/2021"), enacts a new licensing scheme for mining business activities and overhauls the divestment obligation for foreign investment companies holding a Mining Business License. * Indonesia’s coal Production through October 2021 rose 9.4% to 512 million tonnes, up from 467.88 million tonnes in the same period last year, a latest report shows. January-October exports by the country rose 36.6% to 367 million tonnes from 268.62 million tonnes last year.

The country has set its benchmark coal price at a record high $215.01 per tonne last week on higher demand for winter. * Indonesia's 2022 coal consumption for power generation is likely to reach 119 million tonnes and is likely to rise by 3.1% next year compared to 2021. Coal demand by state utility Perushaan Listrik Negara (PLN) itself is expected at 68.43 million tonnes next year, while 50.76 million tonnes is likely to be used by independent power plants.

US Coal News:

* The US has surpassed Russia as China's biggest met coal importer in 2021, with China importing 7.187 million mt from the US in January-September, 8.7 times higher on the year, customs data showed. Analysts say Chinese demand for US based met coal in 2021 to be 580.02 million mt, up 4% from 2020. * U.S. miners are struggling to ramp up coal production as American utilities burn more, leading to dwindling stockpiles and rising prices. U.S. miners say demand is going to remain strong through next year, and some already have contracts to sell almost all of their expected output for 2022. While Prices will probably come down over the next few months, it won’t return to where they were at the start of the year.

CCAI Monthly Newsletter November 2021

| 31

* While the price of coal has skyrocketed as global demand explodes, US mining operations are grappling to keep up with demand. A ton of central Appalachia coal was $89.75 (£63.37) per short ton, according to the US Energy Information Administration, a more than $10.70 jump in three weeks. Overall, coal’s value is up 35% from earlier this year and has hit a 12-year high. * Railroads are benefiting from China’s continued appetite for U.S. coal as America exports coal to China in volumes unseen in much of the past decade. Data from the U.S. Energy Information Administration shows that through the first half of 2021, the U.S. has exported 5.4 million tons of coal to China, compared to slightly more than 531,000 tons for the same period a year ago — a profound 920% increase year-over-year.

Pet Coke News: * Indian petcoke buyers have remained relatively silent this week in spite of significant demand as the US Gulf coast and Australian origin petcoke prices are expected to climb down further. Also, reduction in Australian and South African coal prices have prompted traders to look for alternatives to petcoke. * Prices of US based petcoke crashed this month owing to low demand from overseas buyers-particularly from China as the buyers there are mostly relying on domestic petcoke for short-term procurement and also waiting to see whether prices fall further in the next six to eight weeks. * Petcoke sales in the US more than doubled this month owing to significant spurt in demand. Major share of US petcoke has been exported to neighboring Mexico, followed by Japan. Large share of US based petcoke from USA’s Lake Charles and Long Beach region was also sent to Greece, India and Panama.

32 | CCAI Monthly Newslette November 2021

Shipping Update: * Canada has banned thermal coal exports to and from the U.S., which is expected to lower the northernmost North American environmental impact exponentially. In a late August announcement, the governing Liberal Party pledged to ban all thermal coal exports from the country border between the U.S. may soon be closed to trainloads of American coal that pass through Canadian export terminals on their way to overseas markets. * The deal between Russia and India to supply up to 40 million tonnes of coking coal to India every year may have little or no impact on the demand for dry bulk shipping. Since RussiaIndia is predominantly Panamax routes, the impact of the recent deal on the demand for Panamax vessels will depend on the port that will supply coking coal to India. Russia has been exporting coal through Murmansk, Vanino, Vostochny and Ust-Luga, of which Vanino and Vostochny are almost equidistant from India, as is Australia so there will hardly be any addition in the overall vessel demand. * Shipping companies that transport the world’s coal are in the crosshairs of some financial backers who are cleaning up their businesses in the absence of a truly global drive by nations to renounce the dirtiest fossil fuel. In a sign of investors taking the initiative, six European firms collectively representing over 5% of the estimated annual $16 billion capital financing requirements of the dry bulk industry have said they are either reducing their exposure to vessels that transport coal or are considering doing so. * Greek Prime Minister Kyriakos Mitsotakis said his country is pushing ahead with the green transformation of its economy as it plans to become a global leader in the decarbonisation of the shipping industry. Greece is among a number of important shipping nations to back an International Chamber of Shipping proposal for a $5 billion research and development fund, the IMO Maritime Research Fund.

PRODUCTION AND OFFTAKE PERFORMANCE OF CIL AND SUBSIDIARY COMPANIES COAL PRODUCTION (Figs in Mill Te) NOV'21

SUB CO.

APR'20 - NOV'21

ACTUAL THIS YEAR

ACTUAL SAME PERIOD LAST YEAR

ACTUAL SAME PERIOD LAST YEAR

% GROWTH

ECL

2.20

4.30

-49.20

18.30

25.80

-28.90

BCCL

2.60

2.50

0.60

17.20

14.80

16.50

% ACTUAL GROWTH THIS YEAR

CCL

5.70

6.40

-10.90

36.40

32.50

11.80

NCL

10.80

10.00

8.40

75.10

73.70

1.90

WCL

5.40

3.20

68.90

28.40

23.20

22.50

SECL

12.20

12.40

-1.40

77.70

76.70

1.23

MCL

14.90

12.80

16.20

100.30

87.70

14.30

0.00

0.00

353.40

334.50

NEC CIL

0.00 53.80

51.70

4.10

5.60

OFFTAKE (Figs in Mill Te) NOV'21

SUB CO.

APR'20 -NOV'21

ACTUAL THIS YEAR

ACTUAL SAME PERIOD LAST YEAR

ACTUAL SAME PERIOD LAST YEAR

% GROWTH

ECL

2.60

3.70

-28.30

BCCL

2.40

2.20

8.80

23.60

26.40

-10.50

20.30

14.90

36.30

CCL

5.70

6.30

NCL

11.50

9.70

-9.80

45.20

39.30

15.10

19.40

80.50

69.60

15.60

% ACTUAL GROWTH THIS YEAR

WCL

5.70

4.70

21.50

39.90

28.30

40.70

SECL

13.40

12.20

10.20

98.90

85.80

15.30

MCL

15.40

12.60

22.90

112.70

92.70

21.60

0.00

0.10

56.80

51.30

10.80

421.10

357.10

NEC CIL

0.00

17.90

CCAI Monthly Newsletter November 2021

| 33

OVERALL DOMESTIC COAL SCENARIO Coal Production (in MT) Company CIL SCCL

October, 2021 49.81 5.30

October, 2020 46.81 3.89

% Growth 6.4% 36.1%

April- October, 2021 299.62 35.25

April- October, 2020 282.83 22.02

% Growth 5.9% 60.0%

Overall Offtake (in MT) Company

October, 2021

October, 2020

% Growth

April- October, 2021

April- October, 2020

% Growth

CIL SCCL

56.66 5.42

50.68 4.01

11.8% 35.1%

364.38 36.71

305.81 21.87

19.2% 67.9%

Coal Despatch to Power (Coal and Coal Products) (in MT) Company

October, 2021

October, 2020

% Growth

April- October, 2021

April- October, 2020

% Growth

CIL SCCL

47.67 4.71

39.17 3.32

21.7% 41.7%

291.72 30.67

237.75 18.47

22.7% 66.0%

Company

Coal Qty. Allocated October, 2021

Coal Qty. Allocated October, 2020

Increase over notified price

Coal Qty. Allocated April- October, 2021

Coal Qty. Allocated April- October, 2020

Increase over notified price

CIL

0.41

5.06

97%

15.51

21.69

61%

Spot E-auction of Coal (in MT)

Special Forward E-auction for Power (in MT) Company

Coal Qty. Allocated October, 2021

Coal Qty. Allocated October, 2020

Increase over notified price

Coal Qty. Allocated April- October, 2021

Coal Qty. Allocated April- October, 2020

Increase over notified price

CIL

1.15

6.51

174%

18.49

16.58

29%

Exclusive E-auction for Non- Power (in MT) Company

Coal Qty. Allocated October, 2021

Coal Qty. Allocated October, 2020

Increase over notified price

Coal Qty. Allocated April- October, 2021

Coal Qty. Allocated April- October, 2020

Increase over notified price

CIL

0.00

3.36

-

20.16

16.80

28%

Special Spot E-auction (in MT) Company

Coal Qty. Allocated October, 2021

Coal Qty. Allocated October, 2020

Increase over notified price

Coal Qty. Allocated April- October, 2021

Coal Qty. Allocated April- October, 2020

Increase over notified price

CIL

0.00

0.28

-

2.66

2.29

81%

Special Spot E-auction Scheme 2020 For Import Substitution Company

Coal Qty. Allocated October, 2021

Coal Qty. Allocated October, 2020

Increase over notified price

CIL

0.05

1.60

300%

34 | CCAI Monthly Newslette November 2021

Coal Qty. Allocated April- October, 2021 2.33

Coal Qty. Allocated April- October, 2020 1.60

Increase over notified price 50%

CCAI Monthly Newsletter November 2021

| 35

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