Coal supply for power plants in India is ramping up and will soon normalize, an unnamed senior official from the energy ministry in New Delhi said, as quoted by Reuters. At the moment, coal power generators are getting 2.6 million tons of coal daily, which is a record high, the official also said.
The news comes on the heels of a warning that as many as 96 coal power plants in the country only had coal stocks for three days of consumption, according to data from India’s Central Electricity Authority. A three-day stock is a critically low level, and the number of plants operating at that level was an increase from 60 power plants operating with critically low stocks as of mid-September.
The decline in stocks comes amid higher demand for electricity driven by lower generation from other sources, particularly hydro, amid lower rainfall. Earlier this year, a climate outlet warned the El Niño phenomenon could drive coal demand in India significantly higher. El Niño tends to affect wind and hydropower production by changing wind and rainfall patterns. While wind does not account for a big portion of India’s energy mix, hydropower does contribute significantly to power output.
Higher industrial production is also contributing to the power supply tightness, with Reuters reporting this week that the state of Gujarat had asked factories to reduce their electricity consumption in the evenings to avoid blackouts down the road.
In response to the decline in coal stocks last month, India’s Ministry of Coal said that domestic coal companies were ramping up supply to the coal-fired power plants. The latest update suggests this was not enough to rebalance demand and supply. Daily demand for electricity in the country so far this year has been running at peaks that were 45-50 GW higher than a year ago, Reuters reported earlier this week.
By Charles Kennedy for Oilprice.com
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