India’s energy sector will be needing an additional 28GW coal-fired power generation capacity by 2032, advisory body Central Electricity Authority (CEA) stated.
These additions will be needed on top of the 25GW in thermal coal projects currently under construction. In its ‘Draft National Electricity Plan (Vol-1 Generation) CEA gives these recommendations for ‘feedback’ to stakeholders. CEA is publishing a National Electricity Plan every five years, putting it in front of licensees, generation companies, and the general public. The institution also stated that the BESS (Battery Energy Storage System) requirement in 2031-32 is varying from 51GW to 84GW. In a warning to the industry, the CEA indicated that in case of a delay in the construction of hydro-plants, there will be another 4GW of coal-fired power generation needed in 2026-2027. India’s energy industry is also looking at base load nuclear capacity, but in the meantime, cheap coal serves as an alternative. The CEA report further indicated that India’s peak electricity demand is set to be hitting 272GW, while electrical energy requirements are set at 1,874BU in 2026-2027, while for 2031-32 363GW and 2,538BU is needed.
To increase local coal production, the Indian Ministry of Coal is holding an e-auction for 10 commercial mines, as the technical evaluation of bids is completed. The peak rate capacity of these mines being put up for e-auction is 39.31 mtpa. An e-auction for 8 coal mines is done on September 13, while the remaining 2 are being held on September 14. Until now, the Indian Ministry of Coal has successfully auctioned 43 coal mines with a peak rate capacity of 85.54 mtpa. In statements last month, Indian coal minister Pralhad Joshi stated that around 107 coal blocks will be put up for auction in the future. India’s overall coal production increased by 8.27% (Y-o-Y) to 58.33 million tons in August 2022 compared to 53.88 mt in August 2021. By 2030, India’s coal demand is set to hit 1.5 billion tons.
Pylyp is an experienced private banker and asset manager.