Coal Demand To Surpass Supply In 2021-22, Says Government

Government has projected that the overall coal demand will outstrip the domestic supply in the current financial year.

The development assumes significance in the wake of certain parts of the country grappling with power outages in the wake of coal shortage, which has compelled Coal India to import dry fuel for the first time in seven years to meet the demand of power plants. (Also Read: Amid Power Shortage, Coal India To Import For First Time Since 2015)

While the overall coal demand in 2022-23 is expected to be 1,029 million tonnes, the domestic supply of fossil fuel is estimated to be 974 million tonnes, according to the latest medium-term projections of dry fuel by the coal ministry.

Of the overall demand in the current fiscal, the power sector accounts for the major chunk of 735 million tonnes and the remaining 294 million tonnes by the non-power sector.

However, the estimated domestic supply of coal at 1,304 million tonnes is expected to exceed the overall coal demand of 1,134 million tonnes in the next financial year.

In 2027-28 the overall demand for dry fuel is likely to be 1,313 million tonnes and the domestic supply is projected at 1,456 million tonnes.

In the 2029-30 financial year, the domestic supply of dry fuel at 1,511 million tonnes is again expected to surpass the demand at 1,448 million tonnes.

"In order to meet the peak energy demand, it has been imperative to track the performance of the several sectors contributing in the energy sector....(therefore) after detailed discussion with Coal India Ltd and coal consuming sectors, Ministry of Coal has estimated the projection of coal demand up to 2029-30," the ministry said.

Last month, the Coal Ministry said that the current power crisis is mainly due to the sharp decline in electricity generation from different fuel sources and not due to the non-availability of domestic coal.

Coal Secretary A K Jain had attributed the low coal stocks at power plants to several factors such as heightened power demand due to the boom in the economy post-COVID-19, the early arrival of summer, a rise in the price of gas and imported coal and a sharp fall in electricity generation by coastal thermal power plants.

He was of the view that a slew of measures is already underway to enhance the total power supply in the country.

The gas-based power generation which has fallen drastically in the country has aggravated the crisis.