EnergyWatch

India joins nations hit by coal shortage

According to the Indian Ministry of Power, the country's 135 coal-fired plants have an average of four days' supply on inventory, reports Financial Times, with more than half of these having fuel for less than three days.

Photo: AHMAD MASOOD/REUTERS / X90061

India is the latest in a row of countries facing a serious energy crisis threatening the post-pandemic upswing. Public authorities warn of dangerously depleted stockpiles for feeding thermal plants, reports Financial Times.

According to India's Ministry of Power, 135 coal-fired plants have an average of four days of stockpiled fuel supply, reports Financial Times, with more than half of these having input for less than three days.

India's electricity generators have decreased coal import in recent months on account of a global price surge resulting from greater demand from Europe and China.

Meanwhile, New Delhi has been promoting an energy independence policy as a guiding principle for the nation's post-pandemic economic rebound, the British business media writes.

"Fundamentally, we’ve been so laser-focused on demand recovery from the pandemic — that has been such center stage — that all these supply-side issues haven’t been in the limelight until they started to bite," says Aurodeep Nandi, India economist at Nomura Financial Advisory and Securities, to Financial Times.

The looming coal shortage is now raising the likelihood of power outages, higher electricity prices and a shock to power generators' profits in a country where coal plants now produce roughly 66 percent of electricity.

"If the government doesn’t ramp up production or if imports aren’t increased, there will be power cuts," Nandi said.

According to the media, India's power consumption from August to September rose to 124.4 billion units, an Indian metric equating to 124.4TWh, from 106 billion units against the same period last year.

Coal from Indonesia, one of India's main suppliers, has appreciated from USD 60 per tonne in March this year to USD 200 a tonne in September.

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