The Power Ministry has warned the thermal plants which used the imported coal that has stopped operations due to high international coal prices and said that it was “inexcusable” for a generator to not offer power as per power purchase agreements (PPAs). As it was to be noted that most plants fueled by imported coal have stopped operating due to a sharp hike in global coal prices which has made the supply of power at contracted rates unfeasible. This has further contributed to the problem of low coal stock at thermal power plants which use domestic coal which has further led to plant outages and forced the states to buy power on exchanges and imposing power blackouts.
According to s Coal India Ltd (CIL), the primary reason for the sharp decline in the availability of fuel stocks at power plants has been the deceleration of generation by 14 imported coal-fuelled power projects owing to the spike in global coal prices. To meet such a rise in demand, the onus has shifted upon the domestic coal-fuelled power projects, which has led to an unplanned need for 10 million tonnes (mt) of coal.
According to the minutes of a 7 October meeting called by power secretary Alok Kumar with representatives of the power producers and officials of Gujarat, Haryana, Rajasthan, Maharashtra and Punjab, it stated,” Not stocking fuel stocks or not giving availability on any pretext is inexcusable. Such conduct on the part of the seller should be immediately responded to by the procurer sternly by using all possible contractual and other available legal interventions at the level of state government.”
As per Minutes reviewed by leading financial daily, Mint: “If any gaming is noticed on the part of the seller such as not supplying under PPA (power-purchase agreements) and selling in the market, it should be brought to the notice of the regulatory commission without any delay under intimation to the ministry of power for immediate intervention,”
“It was informed that GUVNL (Gujarat Urja Vikas Nigam Ltd) had sent a letter dated 01.10.2021 and requested the intervention of MoP (ministry of power) to impress upon Coastal Gujarat Power Ltd (CGPL) to operate Mundra Ultra Mega Power Project (UMPP) in the interest of the public at large, and this meeting was convened to discuss the issues related to power supply from imported coal-based power plants,” the minutes further stated.
Mint reported earlier that the plan drawn up by the Prime Minister’s Office (PMO) to ensure continuous fuel supplies to power plants involves facilitating operationalizing imported coal-fuelled power generation capacity of 17.06 gigawatts, located along the coastal regions, to help relieve the pressure on domestic coal-fuelled power projects.
An Essar Power spokesperson said in an emailed response to the Mint, “We are in constant touch with the government, with multiple conversations already taken place. We ran our Salaya plant until March this year and could not operate it further as the cost of imported coal increased twofold, making operations financially unviable. We at Essar are ready to support the nation in whatever way we can and are working closely with the government to reach an optimum solution that will help in the current crisis and at the same time enable us to commence operations at our plant in a viable manner,”