New Delhi: India is fully geared up to meet the expected peak power demand of 270 GW in 2025, with the coal stock position better than it has ever been in so many years, said Power Secretary Pankaj Agarwal on Friday. Speaking to the media during a press conference, Agarwal said, “We are fully geared up to meet the peak power demand of 270 GW… With reference to the coal stock, we are in the best position that we have been in the past many years. We have never had so much coal stock. We presently have about 51 million tonnes of coal stock, which is a very, very good number. We already have more than 21 days’ of coal stock.”
“And this stock is not concentrated in only certain pithead stations, it is very well distributed. I really want to complement the Ministry of Railways and Coal that even during the Mahakumbh, they have managed to maintain good coal supplies,” said the Power Secretary. On being asked if the government will invoke Section 11 of The Electricity Act, Agarwal said that if required, it will surely be invoked, adding that a decision in this regard will be taken when peak power demand inches closer to the projected figure.
With coal contributing around 77 percent of the total power generation, India relies majorly on coal to meet its power demand. After the economy opened up post the lockdown imposed to contain the COVID-19 pandemic in 2020, India’s power demand has seen an unprecedented rise, increasing at a compounded annual growth rate of 7 percent every year. However, in the backdrop of an increased power demand, India faced a shortage of coal year after year since coal production was not able to keep pace with the rapid growth in power consumption. The improvement in India’s coal stock situation this year is the first time when India is in a comfortable position since 2020 vis-à-vis coal stock to meet the rise in power demand in the coming summer months when temperatures rise beyond 45 degrees Celsius and the use of cooling appliances increase significantly.
The government had been mandating power generating companies to blend six-to-four percent of imported coal with domestic coal for power generation every year since domestic coal production alone was not enough to meet the demand from the power sector. The last such directive expired in October and the mandate has not been renewed since then. Minister for Power Manohar Lal Khattar told the media that even with no directive in place mandating blending of imported coal, companies have been blending 1 percent imported coal as of now, which is within the government’s target. He added that India is expecting the peak power demand to touch 345 GW by 2030 and is prepared to meet that demand as well.
Stressing that India will utilise its gas-based power generating capacities to meet the swell in power demand in the summer months, when the need arises, the Power Secretary said, “We have already invited a tender for contracting gas for 1,800 MW capacity. We are hoping to finalise the tender in a month’s time. We are invoking gas, there’s no doubt about it. (sic).”
However, Khattar added that there are no plans to start utilising India’s gas-based power plants for situations other than exigencies, like the spike in peak power demand during summer months, because of the high cost of gas-based power. Khattar said that power generated from gas costs Rs 14 per unit. “India has a total gas-based power generation capacity of 24 GW. And this will remain static at 24 GW until 2030. We have no plans to use gas-based capacities in situations where it is not required,” said the minister.
It must be noted that the International Energy Agency (IEA) has recently released a report forecasting India’s gas demand to grow by 60 percent by 2030, provided India starts using gas for power generation, along with other sectors where it is already in use. India’s gas consumption has increased in the last two years, however, its share in the overall energy mix has been static at about 6 percent since 2018, even though the government plans to increase the share of gas to 15 percent by 2030.
