India Ramps Up Rail Coal Deliveries as Power Plant Stockpiles Dwindle
Key Takeaways
- •Fifty-three Indian power plants had coal stocks below the critical 25% threshold as of September 5, up from 45 on August 26, according to Central Electricity Authority data.
- •Coal accounts for roughly 70% of India's electricity generation, making power security closely tied to coal supply logistics.
- •El Niño-driven heat has boosted electricity demand while monsoon rains disrupted coal mining and transportation in August.
- •Power plant coal stocks fell 15.5% between August 1 and August 23 as deliveries lagged consumption, according to consultancy BigMint.
- •Rail coal shipments to power plants have increased recently, with Coal India Limited, SCCL, and captive mine operators ramping up supply under ministry monitoring.
Indian coal companies are ramping up supply to coal-fired power plants as coal stocks at dozens of facilities have dropped to critically low levels, India's Ministry of Coal said on Monday.
More than 50 coal-fired power plants in India — where coal remains the single largest source of electricity generation, accounting for around 70% of the country's power output — saw their coal stocks fall below the critical threshold of 25% as electricity demand rises amid a strong El Niño, while supply has been disrupted by monsoon rains.
The number of power plants with critically low coal stocks climbed to 53 as of September 5, up from 45 on August 26, according to the latest data from the Central Electricity Authority (CEA).
India has faced recurrent coal supply crunches in recent years, including a shortage in the autumn of 2021 that left many plants with only days of coal on hand and prompted emergency measures to boost deliveries. Episodes like these highlight how closely India's power security remains tied to the logistics of moving coal — largely by rail — from producing regions to generators.
Coal shipments via rail to power plants have increased in recent days, the Coal Ministry said. The rise "reflects the sustained efforts of Coal India Limited (CIL), its subsidiaries, SCCL and captive mine operators to ramp up coal supply to the power sector," the ministry added.
"The number of critical thermal plants (stock below 25% of normative requirement) are being closely monitored, with corrective coal supply measures already in place to further ease the position at these plants," the ministry noted.
The Ministry of Coal and state-owned Coal India Limited, the world's biggest coal miner, "remain committed to sustaining this improving trend in rake loading to the power sector and meeting the requirements," the ministry said.
In August, monsoon-related disruptions to domestic supply tightened the immediate availability and transportation of coal from the coal-rich producing states to coal-fired power plants.
Stocks at India's power plants declined by 15.5% between August 1 and August 23, as receipts of coal deliveries lagged the rate of coal burns, commodity consultancy BigMint said last month.
India's monsoon season has been disrupted by El Niño, with hotter-than-usual temperatures driving up power demand.
By Tsvetana Paraskova for Oilprice.com
