KOLKATA (miningweekly.com) – India’s largest power utility, NTPC, is aiming to source as much as 67% of its thermal coal requirement from captive mines within the next year.
NTPC, which has been allocated ten coal blocks for captive mining, has already initiated a process of opening technical bids, awarding contracts and appointing mine developer operators for five of these blocks with the aim of bringing them into production by the end of the next financial year.
These five coal blocks are expected to produce 56-million tons a year of thermal coal and meet about 67% of NTPC’s current dry fuel requirement of 170-million tons a year.
The ten coal blocks with NTPC have aggregate estimated geological reserves of 7.3-billion tons and once operationalised, will produce 107-million tons a year, making the power utility the country’s second-largest mining company, after Coal India Limited (CIL).
In the current financial year, the power utility will be producing about three-million tons of coal from its Pakri Barwadih block and this will be followed up by starting production from its Dulangi captive block over the next few months, company officials have said.
NTPC currently operates 20 coal-based thermal power plants with an aggregate generation capacity of 38 755 MW. Its strategic plan includes a generation target of 128 000 MW by 2030.
However, considering NTPC’s aggressive plans to ramp up generation capacity with continued focus on thermal power plants, the contribution of coal from captive mines to its total dry fuel requirement is unlikely to keep pace. For example, the power utility is planning to invest $10-billion on constructing three new coal-fired thermal plants with aggregate generating capacity of 5 GW although officials say government and the NTPC board are yet to approve the investment.
About 55% of India’s primary energy supply is currently based on coal and according to a draft policy, it will remain high, in the range of 48% to 54% by 2040.
Power sector analysts point out that despite increased availability of coal from its captive mines, NTPC’s long-term dependency on merchant purchase of fuel from CIL is likely to remain, if not increase, against the backdrop of the power utility’s future expansion plans, and with it the sporadic shortages of fuel faced by its plants.
For example, about 70 thermal power plants across the country have coal stocks equivalent to only six days of consumption, down from the average of stock equivalent of 28 days a year earlier.