The move follows projections of weaker electricity consumption due to pandemic and increased government efforts to discourage coal imports, among other utilities.
New Delhi, August 20: State-controlled power utility NTPC said it is unlikely to seek any more imported coal during the current 2020-21 fiscal year ending 31 March. The move follows projections of weaker electricity consumption due to the Covid-19 pandemic and increased government efforts to discourage coal imports, among other utilities.
“In this scenario, I do not think we will be issuing any coal import tenders at least in this fiscal year”, an NTPC official told Argus.
Accounting for almost a quarter of India’s installed coal-fired power generation capacity, NTPC has decided to defer receipts of most of the imported coal it had already tied up. It still has to take delivery of about 1.72MT of imported coal from a total 6.35MT it contracted over 2019-20 and 2018-19. “It should be enough to meet any short-term requirements”, the official said.
The decision may further weigh on India’s receipts of imported coal this year. According to shipping broker Interocean, the country’s coal imports were down by 1.54MT from a year earlier to 10.11Mt last month, resulting in 5th consecutive month of annual falls, although the rate of decline being much smaller compared to the second quarter of this year.
Given the weak outlook for the country’s economic and industrial activity despite a partial easing of the lockdown, NTPC’s move highly underscores issues about sustaining the pace of recovery in national coal consumption. The average coal-fired output in July was only 3GW lower against the previous year at 105GW, which was a significant recovery from 97GW a month earlier and 82GW in April, when output had fallen by 25GW and 39GW respectively.
Significantly, the firm renewables output weighed on the possibility of a stronger recovery in coal use. Overall national power output reached parity with a year earlier at 146GW in July, but coal’s share in the mix was squeezed by a 3GW annual increase in hydropower output, which rose to 24GW.
In the latest development, NTPC too is planning to boost its renewables plans in line with the country’s drive to reduce its dependence on coal for electricity generation. The company said yesterday that the utility now wants renewables to account for at least 30% of its projected installed capacity of 130GW by 2032, up from 25% planned earlier, an ambitious plans considering only 1.7% of its current generation capacity of 62.91GW is based on renewable energy, while about three-quarters of its projects under construction are coal-fired power plants. It reported a 5.9% drop in profit from a year earlier in the April-June quarter to ₹29.49bn ($395mn) because of weaker power generation.
