India’s changing goal posts over coal

News: In April, the Union Finance Minister had said India’s transition away from coal as a fuel for power would be hampered by the Russia-Ukraine war.

Why the ‘move away from coal’ is so important?

The threat of global warming looms over the planet, promising to bring about unprecedented natural calamities. An effective way to prevent this is to cut the use of fossil fuels — coal, natural gas and oil.

Coal emits more carbon dioxide: About 80% of the world’s energy requirements are met by the abovementioned three fuels. However, the worst culprit of them all is coal, which emits nearly twice as much carbon dioxide as natural gas and about 60% more than oil, on a kilogram-to-kilogram comparison.

– Combusting coal also leaves behind partially-burnt carbon particles that feed pollution and trigger respiratory disorders.

The consequence of these chemical reactions gains great significance because, the power sector in India accounts for 49% of total carbon dioxide emissions, compared with the global average of 41%.

What is the extent of India’s dependence on coal?

As of February 2022,

– the installed capacity for coal-based power generation across the country accounts for about 51.5% of power from all sources.

– Renewable power accounted for 27%

– Natural gas as fuel accounted for 6.3%

Coal-based power stations are retired periodically, which happens all the time. But is not fast enough nor are new additions being halted. And coal is still inexpensive compared with other sources of energy.

According to the IEA’s Coal Report 2021, India’s coal consumption will increase at an average annual rate of 3.9% to 1.18 billon tonnes in 2024.

So, it is not easy to shift away from coal overnight.

How has Russia-Ukraine war made India’s move away from coal difficult?

Increasing prices of natural gas: Natural gas has been dubbed as the transition fuel in India’s plans to move away from coal. The international cost of natural gas has zoomed in the recent past from a level that was considered already too high to be financially viable.

• On May 17, 2022, the price per MMBTU of gas was ₹1,425, compared with ₹500 in April, 2021.

Of the 25,000 MW of gas-based power plants, about 14,000 MW remains stranded, or idle, because they are financially unviable.

While renewable energy sources are cheaper than coal, their ability to generate power consistently is subject to the natural conditions — the wind and the Sun. Coal can give power on demand.

Storage technologies are still not mature enough to help renewable energy sources become reliable generators of power.

Is there a coal availability crisis that is exacerbating our problems?

It appears that the sudden rise of demand post-pandemic has caught policymakers off guard. From having asked States only recently to stop importing coal, the power Ministry urged States earlier this month to step up coal imports as the private sector would take till about 2025 to produce significant amounts of coal.

As per a letter by the Ministry, Coal India, the country’s largest supplier of the dry fuel is set to import coal for the first time since 2015. The aim of the exercise is to avoid a repeat of the power outage crisis that India faced in April — the worst in more than six years.

An internal power Ministry presentation is said to point to a 42.5 million tonne (MT) coal shortage in the quarter ending September on the back of high demand for power supply. Without imports, utilities are likely to run out of coal supplies by July.

Source: This post is based on the article “India’s changing goal posts over coal” published in The Hindu on 31st May 22.