Aluminium industry flags coal shortage crisis

24 Sep, 2021

Even as the government has taken several steps to address the issue of coal shortage at numerous power plants across the country, the aluminium industry — which runs captive electricity generation units to supply electricity to its factories — have complained about the fuel crisis brewing in the sector. In a letter to the Union coal ministry and Coal India (CIL), the Aluminium Association of India has sought for “immediate resumption of coal supply against secured linkages for sustainable industry operations”.

To supply more fuel to power plants, sources said that CIL subsidiary Mahanadi Coalfields has requested Indian Railways to provide a lesser number of railway rakes from the Sardega siding and IB coalfield in Odisha to restrict supply to non-power category consumers. “This adhoc decision without any advance notice has brought down the industry to a standstill and industry has been left out with no time to devise any mitigation plan to continue sustainable operations”, the industry informed CIL in a letter also addressed to the Union coal ministry.

Aluminium is a highly power-intensive industry where coal accounts for around 40% of production costs. To reduce the dependency on the grid, around 9,000 megawatts (MW) of captive power plants have been set by the industry to meet their critical need for an uninterrupted quality power supply. Sources in CIL said that the company is not regulating coal supplies to continuous processing units like cement, aluminium and “does not intend to do so”, adding that “coal companies of CIL have also been advised accordingly”.

Though it said nothing about supply to non-power sectors, the government has officially announced its decision to regulate supply to power plants with low utilisation levels having coal stock of more than 10 days, and the fuel will instead be supplied to needy generating stations with low stock but running at high plant load factor. According to government data, units with a combined capacity of 1,19,087 MW had fuel stocks that would last for less than eight days as of September 20.

Source: The Financial Express