May 21, 2018 - Coal imports by power utilities fell by 22.23 percent to 3.73 million tonnes in April mainly due to decline in shipments by imported coal based power projects in the country.

According to latest data compiled by the Central Electricity Authority (CEA), coal imports by the power utilities came down to 3.731 million tonnes (MT) in April this year from 4.798 MT in April 2017 mainly due to lower deliveries at imported coal based plants. In April 2018, however, the total coal imports by power utilities for blending with domestic coal rose to 1.427 MT from 1.078 MT in April last year.

The scope of reducing coal import is always more at power plants using domestic coal as they use high gross calorific value imported fuel for blending. The data shows that the coal imports came down by imported coal based power plants in April this year. These plants imported 2.304 MT of coal in April 2018 down from 3.720 MT in the same month a year ago.

Experts think that higher international coal prices may have been affecting imports by the power plants based on imported coal. During April, among imported coal based plants, Tata Power’s Mundra Ultra Mega Power Project received 0.509 MT compared to 0.689 MT in the same month a year ago. Similarly, Adani’s 4620 MW Mundra Plant received 0.091 MT imported coal down from 1.322 MT a year ago.

Essar’s 1200 MW Salaya plant and Simhapuri Energy 600 MW plant did not get any imported coal during April this year. However, the two plants had received 0.109 MT and 0.004 MT imported coal during April last year. Coal imports by power utilities in January, February and March this year stood at 4.339 MT, 4.060 MT, 4.396 MT respectively, which indicates a good start in April this year.

However, the power sector experts said that there may be increase in coal imports by not only power utilities but by other sectors as well mainly due to transportation issues. They say that the availability of rakes for supplying coal has been an issue for sometime and private sector power plants do not get priority in this.

The government, however, is doing everything needed to reduce dependence on coal imports particularly by power sector in view of shortage of the dry fuel faced by those. As per the official estimates on the basis of power consumption growth, the requirement of domestic coal in 2018-19 would be about 615 million tonnes, which means that 288 rakes of coal per day would be required from Coal India Ltd (CIL).

During January 3 to 22, 2018, as against a loading plan of 274 rakes, the average supply of rake by CIL was about 259 rakes per day. In a recent report on coal, CARE Ratings said that total coal production may stagnate during the year given no visible improvement in availability of rakes or increase in evacuation infrastructure for mined coal.

It expects the total domestic coal production to grow in the range of 2.5 per cent to 3.5 percent (705 to 712) MT for financial year 2018-19. It stressed that there is an immediate requirement to auction private coal blocks of coking and steam coal for 50 MT per annum, in order to control import of steam and coking coal. Power plants import steam coal.

Total import of coal including coking coal and steam coal could touch 235 to 245 MT if the government approves an order to ban use of pet coke which is a feedstock in cement industry. Additional 35 to 40 MT of imported steam coal would be required to compensate for the pet coke ban, it had said. 

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