Coal India gives stimulus to Power Plants to lift more coal

Coal India Limited (CIL) has paved the way for allowing supplies beyond the Annual Contracted Quantity (ACQ) to thermal power plants of the country including independent power plants (IPP).

This applies to the Gencos which have signed the fuel supply agreements (FSA) embedded with such an enabling clause. With this, CIL has done away with the earlier provision which allowed coal supplies up to 120% of ACQ to power plants and IPPs. The simplification would benefit the power plants that prefer to lift higher quantities of coal beyond their stipulated ACQ.

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CIL has received a boost as it would increase its supplies at a time when coal demand is showing signs of slowing down. In the last week of June this year, CIL's board approved the expansion of supplies beyond ACQ.

This ushers in ease of doing business, and simplicity and avoids duplicity of work. CIL’s pitheads currently have a coal stock of 72 million tonnes (MTs) which is 47% more compared to 49 MTs as of 12 August 2023.

Satisfying the coal demand, supplies to coal-fired plants peaked at an unprecedented 619.7 MTs in FY 2024 meeting 101.6% of the demand projected.

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Compared to 586.6 MTs off-take to the power sector in FY 2023, the increase in volume terms was 31.9 MTs, which is a growth of 5.4%. Of a total of 153 domestic coal-based power plants in the country, CIL has long-term linkages with 127 plants of 592 MTs.

The country has a total of 54 domestic coal-based IPPs and CIL has linkages with 50 of them for 155.7 MT/per annum. During FY 2024 the generation through domestic coal-based power plants was 1177 Billion Units (BU). Of this, tentatively 78% of the generation was fueled by the coal from CIL sources at 915 BU.

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