Coal shortage to aggravate AP power situation if rains fail

With thermal power projects facing shortage of coal, power crisis may grip Andhra Pradesh during the current financial year if the ensuing monsoon does not provide the much-needed hydel power backup.

APGenco, the third largest coal consumer after NTPC and Mahagenco, requires 28.43 million tonne coal for FY12. However, even after taking into account the firm allocation of 1.6 million tonne by way of imports by the Ministry of Energy, there will be a shortfall.

“This situation has arisen mainly because Mahanadi Coal Fields Limited (MCL) has not been able to meet the growing demand though it produces 100 million tonnes of coal per year,” T Prabhakara Rao, director -thermal, APGenco, told Business Standard.

Of the total linkage of 12.27 million tonnes from MCL for the existing thermal power projects run by the state power utility in AP, it supplies only about 7.5 million tonne a year.

AP was able to manage the situation, thanks to its own Singareni Collieries Company Limited (SCCL), which has been supplying to it over and above the coal linkage of 12.24 million tonne. However, despite the additional quantity of 2.94 million tonnes from Singareni, the total shortfall works out to 5.75 million tonnes, according to Rao.

The demand for coal has increased this year as the state has added 710 Mw to its existing installed capacity. Though the power utility was allowed to import 1.6 million tonne coal, it used only about 1 million tonnes last year owing to timely monsoon.

Rao said if the monsoon was not good this year, they would have to approach SCCL for more coal apart from seeking more supplies from MCL. Even if the Genco utilises the full quota of imported coal of 1.6 million tonne, which is equivalent to 2.88 million tonnes of indigenous coal owing to higher heat rate, a similar quantity needs to be augmented.

The two APGenco’s projects that are in the pipeline —1,600 Mw Krishnapatnam project and 600 Mw Muddanuru project — would alone depend on 8.10 million tonne linkage given by MCL.

While the state has Singareni to fall back on, power utilities of Tamil Nadu and Karnataka, which mostly depend on MCL for coal requirements, would face a bigger challenge if MCL fails to ramp up production in the coming years, according to officials.