The Indian government is working on a possible upward revision of planned coal imports for 2014/15.The Coal and Power Ministries had started working on a new import plan midway through the current financial year to tide over a rising coal supply shortage and plug loopholes in imports, an official in the Coal Ministry said.

With half the number of thermal power plants across the country currently having less than one week’s requirement of coal stocks, the 94-million tonnes of imported coal planned earlier this year would not suffice to bridge the demand gap, the official said.

Moreover, in an error of judgment, the 94-million tonne imported coal projection had not taken into account demand for feedstock from the new thermal power plants that were scheduled to go on stream over the next 6 to 12 months, he added.

Apportioning some blame to electricity advisory and planning body, the Central Electricity Authority (CEA), the Coal Ministry noted that the latter had not factored in the additional coal requirement of new thermal power plants going in commercial production during the year, while forecasting total coal required from domestic mines and imports.

The Coal Ministry also sought involvement by the Power Ministry and CEA in the import planning process to ensure efficient demand projection and sourcing from Coal India Limited (CIL), contingency demand and imports to bridge the demand-supply gap.

Citing the loopholes in planning, the Ministry in a communication observed that of the 94-million tonnes of imports planned for the current year, as much as 40-million tonnes of coal would be required exclusively for thermal power plants constructed based on imported coal, thereby leaving just 54-million tonnes for domestic coal-based power plants, whereas the minimum shortage of coal for domestic coal-based power plants would be around 77-million tonnes in the current year. This excluded new thermal plants almost ready for production.

CIL has communicated to the Coal Ministry that it would be willing to take up imports of coal for supply to thermal power plants on a cost-plus basis once the final import target was revised, while power plants would have the option of direct import of the dry fuel.

Source:- miningweekly.com