Business

A tenth of coal-fired plants still at risk for outages, says Crisil

An immediate power crisis may have been averted for now, but about a tenth of India’s coal-fired thermal power plants remain in danger of shutdowns and outages due to erratic coal supplies and high prices for imported coal, rating agency Crisil said on Wednesday.

Domestic coal supplies have been erratic due to rains hampering mining operations, while non-coking coal imports have slid more than 20%. As a result, coal stocks at power plants have depleted to an average of five days’ worth of supplies.

Ankit Hakhu, Crisil Ratings director, expects global coal prices and domestic e-auction premiums to remain elevated over the next few months, rendering about 20 GW of private power generation capacity out of a total 209 GW of coal-based capacity to be ‘most vulnerable’.

“Most of these plants don’t have fuel supply agreements and depend heavily on the open market or imports for coal, with committed tariffs for the power sold to utilities. Therefore, if these gencos continue operations at these elevated current coal prices, it may lead to operating losses and thus these capacities may prefer to shut down till coal prices cool,” Mr. Hakhu said.

Power demand grew about 9% in the July to September quarter compared with the corresponding period in the pre-pandemic 2019-20, but reliance on thermal energy sources rose disproportionately as hydel and nuclear power generation were lower this year.

Even at units with fuel supply pacts, coal supply may be ‘just about adequate for their current generation’, noted Crisil’s associate director Rohan Kulshreshtha.


Our code of editorial values

This article is closed for comments.
Please Email the Editor

Printable version | Dec 3, 2021 4:40:07 PM | https://www.thehindu.com/business/a-tenth-of-coal-fired-plants-still-at-risk-for-outages-says-crisil/article37199875.ece

Next Story