Coal supply stopped for non-power requirements, Kayamkulam plant idles

India coal crisis
A labourer works inside a coal yard on the outskirts of Ahmedabad, India, April 6, 2017. File Photo: REUTERS/Amit Dave

New Delhi: Public sector undertaking Coal India Ltd has decided to suspend the distribution of coal for non-electricity needs and eTender till the power availability situation improves.

The Coal India Ltd direction comes in the midst of Centre’s repeated statements that there is no crisis.

Coal is used extensively by many industrial sectors including cement and steel. With the international price shooting up, companies which use coal started depending on the domestic market in a big way.

The eTender facility entailed purchase of coal through tender via single window system for a specific period. This system has been stopped for the time being.

Coal India produces 80 per cent of coal in the country.

Coal Minister Prahlad Joshi said there is no need for panic and the situation has improved.

The Union power ministry said if the shortage on Tuesday was of 11 gigawatts, it came down to 5 gigawatts (GWA) by Thursday.

As per the figures available for Wednesday, coal in 17 plants had completely exhausted. As many as 112 plants are facing a severe crisis. As a result power cuts are happening in many states including Uttar Pradesh.

Kerala buying power at higher rates from outside
Power production at NTPC's gas-based power station at Kayamkulam in Kerala has been suspended as its major client, the KSEB, stopped purchase due to the prevailing high rate of power in the market.

Currently, the KSEB is purchasing power from other producers outside the state by paying an additional Rs 6/unit of the cost at which it could have procured it from the Kayamkulam Thermal Power Plant, which is a Combined Cycle Power Plant powered by imported and indigenous naphtha, a flammable liquid hydrocarbon mixture.

Kerala had been drawing power at the rate of Rs 12-14 per unit from this plant so far. The power cost from the plant has been high always and there are not enough buyers, except Kerala and Tamil Nadu.

Even though it is not purchasing power, the KSEB is continuing to pay the annual fixed rate of Rs 100 crore to the NTPC.

As per the agreement reached with the NTPC, if the state requires power then it needs to give a 45 days prior notice. This is for making arrangements including getting naphtha.

The NTPC plant is located at Choolatheruvu, Kayamkulam, in Alappuzha district.

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