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Coal shortage hits aluminium makers

Top power and coal ministry officials have met several times over the past week to fix the problem, which industry sources say is being driven by multiple factors.

Published: 31st August 2021 11:06 AM  |   Last Updated: 31st August 2021 11:06 AM   |  A+A-

Coal India will close down high-risk mines that are beyond mitigation. (File photo | AP)

For representational purpose.

Express News Service

CHENNAI: Just days after the government decided to divert coal supplies to power plants with critically low coal stocks, the Aluminium Association of India (AAI) has written to state-run Coal India seeking the restoration of coal supply to captive power plants (CPP) powering aluminium factories.

The “ad-hoc decision” to drastically curtail supplies has “brought the industry to a standstill”, the association said. (We’ve) been left with no time to devise any mitigation plan to continue sustainable operations. Also, resorting to imports at such a short notice is not feasible,” the letter noted, stressing that the CPPs have signed fuel supply agreements with CIL for assured long term coal supplies, and, as a continuous process industry, any disruptions would lead to “severe losses and restart expenses”. 

Over the past few weeks, as peak power demand has averaged a high 192-193 GW, several coal-based power plants have seen stocks dive, with some even forced to halt operations. As of August 29, the Central Electricty Authority’s (CEA) data shows that out of the 134 coal-fired power stations monitored by it, 73 had eight days or less of coal stocks—six stations had zero coal stocks.

Top power and coal ministry officials have met several times over the past week to fix the problem, which industry sources say is being driven by multiple factors. While monsoon disruptions have raised logistical difficulties in certain areas, Coal India has also begun regulating supply to buyers who have not paid their dues, estimated at `17,000 crore at the end of July.

According to a power ministry, a Core Management Team (CMT) has been formed to monitor the situation. “Wherever coal stock is more than 14 days’ requirements of the power plants, coal supply will be regulated... for next 7 days,” it said. The freed up coal (some 1.77 lakh tonnes from 26 stations) will be sent to power plants running low. Captive mines of power firms such as NTPC have also been told to increase production and power producers such as the Damodar Valley Corporation (DVC) are expected to clear some dues.



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