New Delh, Sept. 23 -- Coal inventories at India's thermal power plants declined 24 per cent to 22.9 million tonnes (mt) as of September 19 from 29 mt on August 31, reducing the average fuel cover to just seven days and leaving stocks at only 39 per cent of the normative requirement, according to Central Electricity Authority (CEA) data.
Of the 190 thermal power plants monitored by the CEA, 74 are currently facing critically low coal stocks, up from 51 in August, indicating a deterioration in the inventory position.
Coal stocks had already fallen sharply in August, declining about 42 per cent from 50 mt recorded during the same month last year. The decline came as coal-based power generation increased nearly 13 per cent amid a rise in electricity demand. Average coal cover fell to nine days in August from 17 days a year earlier, marking the lowest level since November 2023.
"The last time inventory levels were at a similar level was in October 2023, when stocks fell to around 7.5 days of cover amid an El Niño-driven increase in power demand. An even tighter inventory position was recorded in September 2021, when stocks fell to around 4 days due to supply-chain disruptions," said Sehul Bhatt, director, Crisil Intelligence.
After remaining relatively stable in July and August, electricity demand rose above 255 gigawatt (GW) during the first week of September and touched around 267 GW on some days. The all-time peak demand of 270 GW was recorded in May this year.
The CEA classifies coal stocks at thermal power plants as critical when they are 25 per cent below the required inventory level or when the available stock can support power generation for less than three days.
According to Crisil, the decline in coal inventories could be a temporary logistical issue rather than an indication of structural supply constraints. Daily all-India thermal power generation remained between 4,058 million units (MU) and 4,190 MU during the past week, according to CEA data.
Earlier this month, the Ministry of Coal said corrective measures were being implemented to address the situation at thermal plants with critically low inventories. Rake loading for the power sector increased to 444 rakes from 370 rakes within a week in early September.
State-owned Coal India Ltd currently has around 76 mt of coal at its pitheads, suggesting that coal availability at the production end remains adequate.
The increase in the number of plants falling below normative stock levels during August and September is also considered seasonally plausible, as monsoon rainfall can affect coal production, loading, quality and railway movement. The CEA's revised stocking norms take these seasonal factors into account.
The prescribed stock requirement for September is 12 days for pithead plants and 20 days for non-pithead plants, the lowest levels prescribed during the year. The requirement rises after the monsoon, reaching 17 days for pithead plants and 26 days for non-pithead plants in February and March.
Published by HT Digital Content Services with permission from Millennium Post.