CEA: Fuel supply, plant closures to be blamed

'Fuel deficit and transmission constraints led to inefficiency'

There was a generation loss of 84.69 billion units (BUs) between April 2012 and January 2013 due to coal and gas shortages, poor quality coal supply and closure of plants for want of fuel, according to the Central Electricity Authority.

Fuel constraints and subsequent loss in generation also impacted the plant load factor (PLF), 69.85 per cent for thermal power projects and 42.60 per cent for gas-based power projects during the period, said the authority.

One unit is one kilowatt hour (KWh) of electricity.

While 58.36 BUs of the total generation loss were attributed to gas shortage, 11.73 BUs were due to coal shortage, said CEA. Further, wet and poor quality of coal resulted in generation loss of 4.3 BUs while 8.5 BUs were lost due to closure of plants. Transmission constraints contributed to loss of 1.8 BUs.

According to CEA, power plants in Mundra and Udupi were some of the ones mainly hit. During 2012-13, CEA said, the anticipated supply shortage of domestic coal was estimated at 70 million tonnes (mt). Of this, 46 mt was to be met through imports, for which all utilities were advised to take required measures. The rest (24 mt) was for units that have imported coal-based plants.

In January, only 82 per cent of the coal requirement was available. The thermal power stations received about 39.6 mt of coal against the demand of 48.2 mt. On January 31, 32 thermal power plants had coal stock for less than seven days of operation. Of these, 17 had stock for less than four days.

Broking firm Morgan Stanley said in a report recently that availability of domestic coal will remain an issue for the industry for at least two to three years unless the government takes meaningful steps to increase domestic production. Coal India’s production growth for April-December 2012 was 6.1 per cent year on year, and growth in dispatches to the power sector in the same period was 11 per cent year on year. It had emphasised a need for increasing domestic coal production by fast-tracking the land acquisition and environment clearance processes and improving mining efficiency at Coal India. Besides, it had suggested the implementation of price pooling for coal.

Morgan Stanley said PLFs at NTPC’s coal stations dropped from an average 85 per cent in FY2012 to 82 per cent during April-December 2012. Moreover, PLFs of independent power projects (IPPs) have been under pressure.

In FY2012, the average PLF for IPPs was 72 per cent. These entities have witnessed a 400 basis point reduction in PLF in F2013 (April to December 2012). This reduction can be attributed partly to lack of coal and partly to lower demand from state electricity boards because of their inability to pay for more expensive power.