The government has been actively promoting increased domestic coal production, leading to a notable decline in reliance on imports.

Amrit Lal Meena, IAS, Secretary (Coal), Ministry of Coal

We have seen that Government of India had taken initiative for large number of commercial mines to come to operation. Recently it has been seen that most of the companies are not keen to continue with their mining operation. In that context what would be the government strategy?

In 2020, the Honorable Prime Minister launched the commercial coal block auction, marking a shift from the previous end-use specific allocations. Since then, 91 coal blocks have been auctioned for commercial purposes, allowing flexibility in the usage of the extracted coal. Unlike before, where the coal mined was tied to specific purposes like power generation or skill development, the commercial approach permits mine owners to sell coal anywhere.

Contrary to suggestions of mines being returned, the reality stands quite different. Out of a total of 152 mines, including those auctioned commercially and those allocated for captive purposes, 51 mines are currently operational. Additionally, around 60 captive mines are in various stages of development. This translates to 51 mines contributing to production last year, yielding a total of 116 million tonnes of coal, approximately 14% of the country’s total production.

Looking ahead, this year is poised for further progress. With the existing operational mines and the anticipated commencement of 7-8 new mines, the production is projected to reach 162 million tonnes, roughly 15% of the country’s total output. It’s noteworthy that none of the holders of commercial or captive mines are returning them. The process to operationalize these mines takes around 51 months due to the various necessary clearances. The Ministry of Coal, in collaboration with state governments and the Ministry of Environment and Forest, is actively facilitating these clearances for all mine auction holders, effectively expediting this process.

Out of 91 commercial mines what is the outcome and what is the progress?

Approximately 5 out of the 91 commercial mines are currently in production, having been auctioned off in the past 3 years. According to our standards, these mines typically take around 51 months to transition into full commercial production. As of now, they have collectively yielded about 8 million tonnes. Projections indicate that they will surpass the 10 million tonne mark this year, showcasing commendable progress in line with our operationalization plan. These developments affirm their positive performance and adherence to the outlined strategy.

Now they have adequate coal and how much coal import you are banning?

Our production plants cater to coal supply across various sectors of the economy, including thermal power plants. In the previous year, a total of 892 million tonnes of coal were produced and delivered to different consumers. This year, we’re aiming to increase production to 1012 million tonnes. Approximately 85% of this coal is earmarked for the power sector, while the remaining 15% serves other sectors of the economy. Coal India has consistently met its commitments; last year, they fulfilled 100% of their commitment and even surpassed it. This year, with a target of 780 million tonnes, they are on track to meet this goal. Notably, certain power plants are designed specifically for imported coal consumption, with around 15 plants situated in coastal areas. Consequently, imports are essential for these facilities. Regarding thermal power plants that rely on domestic coal, our commitment remains steadfast in meeting their requirements. We’ve ensured a seamless supply, even during festive periods like Pooja. We are in WPCl energy secretary thank you for tremendous support during Poojas.

Recently, ministry of power sent an advisory to all the chambers import 6% of their coal demand which was earlier 4% to be continued in June. Why?

The demand for energy in our expanding economy has been notably rising, especially over the past three months, showing an approximate surge of 20%. The need for thermal energy has escalated even more significantly. As a result, there might be logistical challenges in remote areas where ensuring a consistent coal supply becomes imperative to prevent instances of load shedding. It becomes crucial for the government to strategize coal availability and make policy decisions accordingly to avert any energy shortfall.

There is no shortage in domestic coal?

We’re meeting our production targets, but certain logistical challenges persist. This might necessitate imports, which we need to prioritize. The key focus is ensuring uninterrupted power supply without any load shedding and maintaining sufficient availability. The government’s efforts are commendable, ensuring adequacy in this regard.

What is the outlook for poll? Do you see coal import will reduce this fiscal compared to last fiscal?

The government has been actively promoting increased domestic coal production, leading to a notable decline in reliance on imports. In the 2019-20 coal consumption basket, imported coal held a 26% share, which has decreased to 21% in 2022-23. Impressively, the first six months of 2023-24 have seen a further 10% reduction in imported coal.

However, certain sectors, such as those requiring steel hybrid coal, still depend on imports due to its unavailability within the country. Despite our efforts to boost domestic coal production, ensuring adequate availability for all sectors remains crucial. Balancing the increase in domestic production with the specific needs of various consumer sectors poses an ongoing challenge.

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