“No new coal mines need to be allocated/auctioned beyond the current pipeline,” according to the latest study by Coal India Limited (CIL).
CIL commissioned the study, Coal Vision 2030, to assess the future demand scenario for the coal sector in India up to 2030.
This analysis comes at a time when the central government is battling with the problem of low coal stocks in over 50 of the country’s power plants.
As on February 11, there were 52 thermal units that had less than seven days of coal stocks, according to data from the Central Electricity Authority.
The study listed the headwinds impacting the coal sector, including:
- the emergence of renewable energy as a viable key substitute,
- increase in the cost of compliance due to the strict regulatory environment,
- delays in getting requisite clearances, and
- the resultant cost overrun.
The analysis also listed numerous global and domestic events that have put doubt on the future of coal.
“COP21 (Paris agreement) commitments by India; apparent shrinkage in global coal consumption; apparent downward revision of the economic growth projections of India; tepid response to recent tranches of coal block auctions; NPA (non-performing asset) crisis, especially in the steel and power sector that are two major consumers of coal and important sectors linked to economic growth,” stated the report.
Renewables affects coal
On the subject of the emergence of renewable energy as a key substitute for coal, the study highlights the growth of the Indian solar sector in the last two years.
The total capacity addition in solar over the last two years has been more than 8GW, an increase of approximately 200% in the installed capacity.
“Efficient use of materials, improved manufacturing process, improvement in cell efficiency, and decrease in prices of solar inverters and other ancillary parts in the electrical system are expected to continue driving the competitiveness of solar,” the study noted.
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