India’s severe power shortage crisis, the northern states have power outages for 14 hours a day, and the recovery of the manufacturing industry is hindered!
After India experienced the second wave of the new crown epidemic, the economy gradually recovered, and the demand for electricity has also increased substantially. The wind of the energy crisis has also blown to India at the same time.
The rising coal prices have caused this economy, which relies on coal for 70% of its electricity for power generation, to suffer from a “coal burning emergency”. Some power plants have run out of coal, causing a nationwide “power shortage”.
- India’s coal plant lacks coal and calls for shortage
According to India’s India-Asia News Agency, data provided by India’s Central Electricity Authority (CEA) shows that among the 135 major coal-fired power plants, three-fifths of coal-fired power plants can only maintain coal stocks for about 3 days, and more than half of the power plants The coal stocks can be used in less than 2 days.
The coal inventory of power plants in India can maintain an average of 4 days, which is 8 days less than the average number of days two months ago, and far below the 14 days officially recommended by India.
At this stage, a total of 14 power plants have been shut down in Uttar Pradesh, India due to coal shortages, and the number of utility companies without coal has increased from one in August to 18.
India is the world’s third largest producer and consumer of electricity after China and the United States. Once a large number of coal-fired power plants are shut down, the Indian power grid will be under heavy pressure, and the government may reduce the power supply to energy-intensive companies and residential houses.
Sure enough, Indian Prime Minister Modihu recently discussed the current power supply situation with senior officials from the Ministry of Coal and Electricity. Some areas have adopted electricity curtailment to avoid the complete exhaustion of coal.
- Reasons for “no coal available” in India
India is the world’s fourth largest coal reserves. Two-thirds of India’s thermal coal comes from the country, with an annual output of more than 600 million tons. Why does the abundant mineral resources make these coal-fired power plants into the dilemma of no coal available?
It is undeniable that part of the shortage of coal is caused by the increase in electricity demand. In July and August of this year, India’s domestic electricity demand increased by 10% and 18% year-on-year, respectively. During the previous rainy seasons, Indian industrial activity would slow down, and the sudden increase in electricity consumption caught power plants by surprise.
Regarding the “electricity shortage”, the Ministry of Coal of India explained that this year the country accidentally encountered frequent rains, which seriously affected coal mining and transportation.
However, this explanation did not convince the public, and India did not give a solution, which made the people of the country complain.
U.S. media also pointed out that India’s rainfall this year was comparable to previous years. The main reason for India’s coal shortage was the sharp decrease in coal imports. From July to August this year, India’s coal imports fell by 45% year-on-year. In July, The country imported only 2.1 million tons of coal, the lowest since August 2015.
It is understood that India’s lack of domestic coal supply is related to the country’s rigid state-owned monopoly system, land privatization, and difficulties in passing approvals for environmental permits and other issues, so that Indian companies that want to increase coal production have “closed their doors.”
The Russian Ministry of Energy also stated recently that India will import 40 million tons of coking coal from India every year, but now this number has dropped to 8 million tons.
- Imported coal prices soar
Why has India’s coal imports dropped to the lowest level this year? You know India is the world’s second largest coal importer.
In fact, although India has abundant coal reserves, it is inherently insufficient in thermal coal for power generation. It has high ash content and low calorific value, which is a low-quality variety. Among them, coal with a calorific value of less than 4800 calories accounts for more than 70% of the coal production, so it needs to be imported to supplement .
India imports about 300 million to 400 million tons of coal each year, mainly from Indonesia, Australia and South Africa.
But in August, Indian coal companies imported 1.9 million tons of coal, a sharp drop of 42% from the same period last year. why is that?
Because of the inability to buy expensive overseas coal, the global price of thermal coal has risen sharply, weakening the willingness of Indian power companies to import.
As of September, the price of coal in Newcastle, Australia, the main source of imported coal from India, has risen by more than two times year-on-year.
Indonesia is also an important source country for India’s coal imports. In March, the price per ton was around US$60. By September, the price per ton had soared to around US$200.
Due to the skyrocketing price of imported raw coal, India’s Tata Electric Power Company’s Mundra imported coal-fired power plant in Gujarat has stopped supplying 1,850 MW in Gujarat, 475 MW in Punjab, 380 MW in Rajasthan, and Maharashtra. Electricity supply of 760 MW and 380 MW in Haryana.
As many as 14 power plants in Uttar Pradesh providing a total of 4,520 megawatts of electricity have been temporarily closed due to coal shortages.
In a report released by Indian Electricity Minister Raj Kumar Singh, it was acknowledged that due to coal shortages and the surge in demand after the epidemic, India may face up to six months of power shortages.
It can be said that as long as international coal prices remain high, India’s coal imports will remain sluggish. Affected by this, India’s “lack of coal and power outages” may not be alleviated in the short term.
Edit: Yuan Hui