Captive power plants request government to normalise coal supply

A captive power producers' association has requested the government to normalise coal supplies to captive power plant-based industries while pointing out that if the supply of fossil fuel is not restored immediately, it would lead to an irrevocable collateral damage of these national assets.

In a recent representation to the government, the Indian Captive Power Producers Association (ICPPA) highlighted the issue of insufficient coal rake supplies to CPP-based industries at levels of 40 to 50 per cent.

"ICPPA in a recent representation to...Government of Indian has sought urgent support for normalising the coal supplies to Captive Power Plant (CPP) based industries....If this is not restored immediately, it would lead to an irrevocable collateral damage of these national assets," it said in a statement.

In the last few months, the supplies meant for CPPs and industries have been either stopped or significantly curtailed for diversion of these to the power sector, which has led to a perilous situation for other coal-based power generators, adversely impacting their industrial operations.

The decision of coal diversion, left CPP-dependent industry with no time to devise mitigation plans for sustainable operations, forcing CPPs to curtail generation or come to a standstill.

On an average, captive power plant-based industries are getting less than 50 per cent of the coal against secured linkages and Coal India Ltd (CIL) auctions.

Importantly, curtailment to CPP is continuing despite power sector having come out of the coal crisis. The CPP industry consumers are still getting overall coal supplies at just 40 to 50 per cent levels leaving them struggling to get uninterrupted coal supplies for continued operations.

Also, the coal-rake dispatch is at a much lower levels than their requirement booked through linkage and auctions.

The aluminium industry operations are one of the most severely impacted with the price being on a rise recently due to the global shortage. With the coal crisis impacting the industry, the scarcity will lead to further increase in rates. Being a metal of strategic importance, the country cannot afford the shock of aluminium shortage, it said.