Only 3 days of coal left! Big crisis looms for power plant as they run out of coal

Power plants across the country are running out of coal. India's power minister in an interview tells Indian Express it is a “touch and go” affair and that he is bracing for a trying “next five-six months” as India faces a power crisis.

Here are the numbers that worry

As per data 16 of India's 135 coal-fired power plants had zero coal stocks, according to the Central Electricity Authority (CEA). Over half of the plants had stocks that would last fewer than three days, while over 80% had less than a week's stock left.

How did we get here

As the country's economic activity picked up with the declining rate of coronavirus infections, industrial demand for electricity mushroomed. Power consumption in August and September exceeded the volumes from the same months in the pre-pandemic year of 2019. But heavy September rain affected coal production and distribution in mining areas. India has the fourth largest reserves of coal in the world.

So what is happening to supply

To meet the rising demand, Coal India, which accounts for over 80 per cent of India's coal, supplied about 243 million tonnes of coal to power companies from April 1 to September 28, according to a report in Reuters. This is 24 per cent higher than the same period last year and 11 per cent more than April-September 2019.

Can't we just import more coal?

The import option will come at a a great financial cost. Coal from Indonesia, one of India’s major suppliers, rose from $60/tonne in March to $200/tonne in September. European coal has risen to a 13-year high, and Australian Newcastle coal has surged by 250 per cent from last September near record high.