Not accountable for low stocks at power plants: CIL

Says shortage of coal stocks in the new plants is because of higher plant loading factor

Coal India Ltd (CIL), which accounts for 80 per cent of India’s coal production, has clarified it isn’t to be blamed for stocks at power plants dropping to critical levels. A high plant loading factor (PLF) and delay related to coal imports were reponsible for the problem, it said.

It argued its supplies were based on fuel supply agreements, adding had it been at fault, a penalty clause would have been triggered against it. A CIL official said, “One should not forget CIL’s commitment is only for 65 per cent of the total requirement of new plants and 90 per cent of old plants, failing which the penalty clause should apply. But there has been no case in which CIL will have to pay a penalty.”

“In some cases, the PLF is about 100 per cent, even at new plants. It is natural there will be low stocks. There is no solution against low stocks in these plants, as they will get domestic coal only to the extent of 65 per cent of the total requirement, according to the fuel supply agreements. Plants are running at 100 per cent PLF, against the normative 85 per cent; also, they haven’t arranged for imported coal,” he added.

According to the Central Electricity Authority (CEA), of the 100 power plants monitored by it, 27 had less than four days’ of stock. “There has been a little fall in supply from Central Coalfields, owing to rain and rake availability issues. But CIL is able to maintain its committed supply,” said another company official.

NTPC Chairman Arup Roy Choudhury admitted the PLF was higher than normative levels. “We are a generation company. If the country needs power, we have to use whatever stock is available. Someone may want us to work at 85 per cent PLF, but CEA wants us to generate more.”

While the fuel supply agreement had said 65 per cent of the domestic coal was to be supplied by CIL, the miner had proposed to import 15 per cent of the requirement on a cost-plus basis to meet 80 per cent of the requirement of new plants. Though the initial estimate was the import would stand at about five million tonnes (mt) for 50 power plants, many have lost interest. The maiden import tender to be floated by Metals and Minerals Trading Corporation of India (on behalf of CIL) in a few days is likely to be for less than one mt.