Amid rising coal shortage worries, government to consider restarting NTPC plants

14 Jun 2022 , 12:45 PM

Worried that coal supplies will be short as rains halt mining, the government is considering using imported gas to restart NTPC units with a combined capacity of more than 5 GW to produce power during the monsoon months.

Electricity generated from imported gas might cost between Rs22 and 23 rupees per unit or nearly four to five times the present rates. This would be the highest price in history, but it would be the last resort because all available power plants are operating at full capacity to satisfy the increased electrical demand caused by the hot weather.

Last week, India’s peak energy demand smashed records for three days in a row, reaching over 211 GW. Even when blended with 10% imported coal for the monsoon, when coal supplies are hampered by rain, coal stocks at power plants have increased to 24 million tonnes from 20 million tonnes a month ago.

At the moment, each state has its own set of generator contracts. Through a method known as merit order despatch, the cheapest electricity among existing contracts is scheduled a day in advance. To be at the top of the merit order list, the petrol stations will need special permission.

In April, the government ordered imported coal-fired power facilities to start up because the country was experiencing excessive electricity demand and prices were skyrocketing on the exchanges. If states did not wish to acquire somewhat more expensive electricity generated with imported coal, these plants were allowed to sell on power exchanges. Due to rising fuel prices, imported coal-fired power facilities had to shut down. Until the end of the month, power exchange prices are set at Rs12per unit.

NTPC stations like Anta, Auraiya, Dadri, Kawas, Gandhar, and Ratnagiri Power require 18 mmscmd of gas to run at lower capacity during non-peak hours and maximum capacity during morning and evening peak hours from July to September.