The Indian energy crisis

India: Be prepared for a cruel summer this time

The shortage of coal and gas may cripple the country’s existing power generation capacity during the summer. 

Zeebiz.com,

1 April, 2012

The crisis is likely to worsen, a report published in a leading national daily said. The power ministry has fallen 8,000mw short of the 11th plan target — ending March 31 — of an additional capacity of 62,000 mw due to the fuel shortages, the report added.

The Ministry of Power had carried out a downward revision of the 78,500-mw target mid-term to 62,000 mw. But the actual capacity addition at the end of the plan period is much behind at 54,000 mw.

“Fuel shortages have led to missing the targets… I am afraid that fuel shortages may hit the 76,000mw generation target we have set for the next plan period (2012-2017)”, Union minister for power Shushilkumar Shinde have reportedly told the daily.

Coal is the backbone of India’s power sector and currently the largest coal supplier of the country Coal India Ltd’s production has remained stagnant at 420-430 million tonne a year since 2009.

In order to make up for the shortfall, CIL has resorted to coal imports, resulting in a sharp rise in generation costs.

Currently, power producers are importing 40 million tonne of coal in a year, but the figure could go up to 60-70 million tonne by 2012-13. This will put an immense pressure on the power firms as the imported coal costs Rs 4,000 a tonne against the domestic coal price of Rs 1,000 a tonne.

Similarly, KG D6, which is India's largest gas field, is also reeling under low productivity. The production has dropped to 28.16 mmscmd, or million standard cubic metre per day in March 2012 against the projection of 80 mmscmd for 2012.