'India should plan strategic fuel reserves', says Power Secy Alok Kumar

Several reforms in power transmission for renewables are in the offing, says union secretary of power, Alok Kumar

The Union Secretary of Power, Alok Kumar, on Thursday said India should consider having strategic fuel reserves for coal, gas and oil to deal with any demand-supply mismatch.

“Let us start thinking about keeping strategic reserves of these fuels — coal, gas, oil — so that economies are able to adjust and tide over any supply shortfall for about a month or so. That would be a small cost vis-à-vis the cost of disruption and uncertainty which countries face,” Kumar said.

The statement comes at a time when the country is barely out of the coal shortage crisis, which started in August with coal stock levels at thermal units dwindling. Currently, 29 Gw of power generation capacity has one day of coal stock and 22 Gw has less than three days of coal, according to the National Power Portal.

While the Union Ministry of Power and Coal initially denied reports of a coal shortage and an electricity supply crisis, the Centre later asked thermal power generators to import coal for at least 10 per cent blending, citing shortage of domestic coal supply. Kumar, who was speaking at the CII South Asia Power Summit, said the country can never insulate itself from these supply shocks of imported fuel. “We have 17,000-Mw capacity based on imported coal and if imported coal prices go high, that capacity is out. India has 24,000 Mw of gas power plants. They are also virtually out. So, the high prices will make energy security very challenging if we don’t have a well thought out strategy,” Kumar said.

The secretary had earlier told Business Standard that the Centre will redesign norms for coal supply and its storage at thermal power plants to avoid a demand-supply mismatch. 

The ministries of coal and power have jointly decided to draft a monthly coal supply programme for thermal power units to keep a normative 40-million tonne (mt) stock cumulatively at power units by end-March. In order to meet the high coal demand, the power ministry even allowed generation units with un-requisitioned power supply to sell in the merchant market.

Going Green

• Says game-changing reforms in power transmission for renewables soon
• Fuel supply security is a short-term goal
• Real relief will come with increased penetration of renewable energy 
• Reforms will completely overhaul the power transmission planning process