Coal India (CIL), a state-owned company, announced on Thursday that it has launched its first bidding to import 2.416 million tonnes of coal to maintain a steady supply of the fuel to the country’s power plants.
The event is significant in light of the government’s attempts to increase coal stockpiles in order to avoid a repeat of the power disruptions that occurred in April due to a coal shortage.
In a first, Coal India Limited [CIL] launched an international competitive bidding e-tender on Wednesday, seeking proposals for the purchase of 2.416 million tonnes [MTs] of coal, according to the firm.
The coal sourced for the State generating companies (genco’s) and independent power plants (IPPs) is based on their indents. Though coal import is new territory for CIL, the firm has finalised and launched the offer within a week after receiving indents from seven State genco’s and 19 IPPs for 2.41.6 MTs of coal.
The current short-term tender for the import of dry fuel for the second quarter of the current fiscal year is source agnostic. This implies that the coal can be obtained from any nation.
At a time when demand for coal is strong, the Centre designated the Maharatna business as a centralized agency to expand coal supply to state genco’s and IPPs through dry-fuel imports.
The board of directors of the firm gave its approval last week for the public sector subsidiary to issue two international tenders — one for short-term and one for medium-term sourcing of coal from outside.
The imported coal will be channelled through nine ports on the country’s east and west coastlines. The winner agency, as determined by the bidding procedure, will provide coal to the power plants of State genco’s and IPPs.
On May 18, the Ministry of Power issued a warning that if orders for coal imports are not placed by May 31 and the imported fuel does not arrive at power plants by June 15, defaulter genco’s will be forced to raise their imports by 15%.
In addition, if blending with domestic coal does not begin by June 15, the domestic allocation of the defaulter’s thermal power plants would be lowered by 5%, the Ministry stated in a letter to state governments and power production businesses, including IPPs.
In April, coal secretary A.K. Jain gave the cause of the low coal stocks at power plants on several factors, including increased power demand due to the economy’s post-COVID-19 boom, the early arrival of summer, a rise in the price of gas and imported coal, and a sharp drop in electricity generation by coastal thermal power plants.
https://twitter.com/CoalIndiaHQ/status/1189595802865295360?s=20&t=HVIhHEenZcApRRJkYK28aA
Gas-fired power output, which has plummeted in the country, has exacerbated the issue, he told. Coal India, which produces more than 80% of domestic coal, is a key supplier of the fossil fuel to the power industry.
Read More: Bangladesh: National Power Grid Failure Leaves 140 million Without Electricity
Read More: Rising prices of oil and coal pose risks
Watch Video: In A First, State-Owned Coal India Floats Global Tender For Imports
