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  4. Why is India glaring at a major power crisis this summer, and what's next | Depth analysis

Why is India glaring at a major power crisis this summer, and what's next | Depth analysis

Coal accounts for nearly 75% of India's power output. But with the shortage of coal, the power crisis is inevitable. There are other factors that add as well.

Sri Lasya Written by: Sri Lasya @laasiyapriya New Delhi Updated on: May 01, 2022 19:09 IST
On the early onset of summer, the temperatures in many
Image Source : PTI

On the early onset of summer, the temperatures in many parts of India had breached the 45 degrees Celsius mark, thus making living conditions horrid. 

Power crisis explained: India has been on a brink of a power crisis this summer, with most cities and states reporting frequent power cuts and outages. Jharkhand, Rajasthan, Uttar Pradesh, Punjab, Maharashtra, Madhya Pradesh, Bihar, Andhra Pradesh have been witnessing a major demand for power, and a lack of coal to generate electricity.

Key leaders have been blaming the central government, but where lies the problem?

A look at the current scenario

  • From Jammu and Kashmir to Andhra Pradesh, consumers are facing power cuts ranging from 2 hours to 8 hours. Factories are the worst hit as the industrial sector is the first port of call for regulating electricity supplies.
  • Thermal plants across the country are grappling with coal shortages, indicating a looming power crisis in the country, All India Power Engineers Federation (AIPEF) said.
  • Delhi has also written to the Centre over the possibility of power cuts to important establishments. The states and UTs are also taking steps to deal with the situation.
  • Coal inventories at power plants had an average stock of nine days at the beginning of this financial year starting April 1, the lowest since at least 2014, reported Reuters. Federal guidelines recommend power plants have at least 24 days of stock on average.

2021 coal shortage issue flagged

Last year in October, several states had reported that they only had four days of coal stocks because of a delay in the shipping of coal supply. 

The government had, by then, in August, already formed a Core Management Team (CMT) for monitoring of coal supply in the country. And the CMT blamed heavy rains over mines in Rajasthan, Gujarat as the reason for the shortage of coal. 

In December, the Federation of Indian Mineral Industries (FIMI) wrote to PM Modi warning that the coal shortage is prevailing, and is in no rush to leave India. Finance Ministry replied and assured us that the shortage was only temporary. 

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Image Source : PTI

Ranchi: Labourers carry coal onto goods train at Ashoka Coal Mines in Peeparwar, amid a power crisis due to shortage of coal, about 70 Kms from Ranchi, Saturday, April 30, 2022. 

Now, data from the Central Electricity Authority of India (CEA) suggests that most power plants in the country have lesser than 25% of the required level of stocks. 

What is the problem behind the power crisis?

While the states and opposition CMs are quick to blame the Centre for the delayed supply of coal stocks, and the BJP retorting by saying that the matter is the fault of states, the problem can still be narrowed down. 

Increased electricity demand

Till August 2021, India's demand for electricity had risen by 13% after almost two years of the pandemic. With people moving to refrigerators, ACs, and other appliances, the country is spending much more on electricity. India's grid reported a record load of 200,570 megawatts (MW) on July 7, 2021, at the height of last summer, reported news agency Reuters. This was even before the peak of summer had arrived. 

Cut to April 2022: The shortage of electricity as a percentage of demand has shot up to 1.4% over the last week, a Reuters quoted government data, stating that higher than the 1% deficit in October, when India last faced a serious coal shortage, and the 0.5% shortfall in March.

The country's peak power demand touched an all-time high of 207.11 GW on April 29. 

The supply issue

Coal accounts for nearly 75% of India's power output. Data shown on CEC suggests that India's biggest coal suppliers - Coal India and Singareni Collieries have been producing 5% more than they did this time in 2021. There is also the added shortage of trains to deliver coal to the plants, as Reuters mentions: The number of trains committed by the Indian Railways per day is 415, 8.4% lower than the 453 required by the utilities.

In short words, India's coal supply is 85 million tonnes, just as in 2017. But the demand is 25% higher than 2017. 

Russia Ukraine war 

Another major impact is the ongoing war between Russia and Ukraine, disrupting the international coal supply to India. The repercussions of the war included a higher rate of natural gas. Many countries are seeing a rise in inflation, as demand and supply do not match. India is now a victim too. 

Heatwave

This year, India witnessed its hottest April in almost 171 years. On the early onset of summer, the temperatures in many parts of India had breached the 45 degrees Celsius mark, thus making living conditions horrid. And the people are naturally resorting to ACs and other utilities. Household power demand has been spirally due to record high temperatures, thus creating a much bigger need for power, and contributing to the demand. 

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Image Source : PTI

New Delhi: Female workers at a site on the occasion of Labour day on a hot summer afternoon, in New Delhi, Sunday, May 1, 2022. 

What Centre says

The Central government has allowed states to use their captive coal reserves up to 25% to meet growing domestic demand. Coal India Limited has reported an increase of 27.2 percent in its output in April 2022, as compared to the year-ago period, the Ministry of Coal on Friday.

The ministry further informed that the CIL has a coal stock of 56.7 MT at present, while the stock at Singareni Collieries Company Limited (SCCL) is at 4.3 MT, and the captive coal blocks have about 2.3 MT of stock.

In 2020, the Centre had also passed a reform to end CIL's upper hand in coal manufacturing, and allowed commercial mining in the coal sector to be offered immediately. 

Is there a respite?

While the government's measures to increase supply seem promising, the issue of power crisis seems to be unending in the country. Factors like Covid-19, Russia Ukraine war can only be temporary, but India's dependency on coal can only mean that exhaustive minerals will lead to even more issues. With unprecedented changes in the weather and heatwaves, India might be glaring at an upward scale demand for power. If the coal shortage is a sustained problem, it is time for an alternative.

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