Coal news and updates

India is burning 8% less coal than three years ago for producing each unit of power as quality control measures initiated by the government three years ago begin to take effect, according to presentations made to PM Narendra Modi during review of key infrastructure sectors on Tuesday.

According to data, indicate power plants consuming 630 grams of coal in the April-February period for generating each unit of electricity against 690 grams in 2013-2014. While an obvious takeaway is lower carbon emission and damage to the environment, the reduction in the coal burning rate has also managed to shave 21-30 paise off tariff.

Cost of coal makes up 54%-60% of the price charged by power producers and is passed on to consumers. So technically, discoms should also have reduced the tariff. But in reality, discoms coping with sagging bottom lines and commercial losses may not be able to reduce monthly bills of consumers and use the saving to offset part of their losses.

But they will also find it hard to justify to state regulators demand for tariff hike, something that is becoming evident as few states are seeking upward revision in tariffs this year.

Source: TOI