US Coal Exports
Exports Economic Contributions Report
Oct 13 2014

India Experiencing Coal Shortage (Penn Energy)

Coal News: India struggling to keep plants powered during coal shortage

A significant energy crisis in India continues to loom as more than half of the nation’s power plants are experiencing a serious shortage of coal, Reuters reported. The Central Electricity Authority said of India’s 103 thermal power plants, 60 may have less than a week’s supply of coal left. Of that 60, more than half are at risk of running out in just a matter of days.

Coal India is depended upon for more than 80 percent of India’s total coal production, but has been consistently failing to meet its production targets, leading to instability on the grid and higher electricity costs.

Corruption has also disrupted India’s already precariously positioned coal sector. The Associated Press reported in September that a ruling from the nation’s top court would require that private companies return ownership of most of the coal fields allocated to them by the government since 1993 under what it declared a corruption prone bidding system. Of the 218 coal blocks granted to private companies between 1993 and 2010, only four were exempted from the ruling. All four of the excluded mines are ones that supply thermal coal to power plants.

Current shortages have also put increasing pressure on India’s economy, as the nation relies heavily on coal-fired power for industry. Shortages have forced many states to strictly ration power to industries and homes, said Reuters.

“The situation is very bad, with power cuts of up to 16 hours a day,” said Vijay Agarwal, a director at Puja Ferro Alloys in Goa state, according to Reuters. “The shortage has raised our costs while output is at 60 percent of what it should be.”

As coal production in India falls, imports of coal continue to rise with shipments reaching 168.4 million tons in the fiscal year through March 31.

See article here.

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