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The largest power generating company in India, NTPC Ltd, is looking for bids to import at least one million tons of coal for the first time in two years, Bloomberg reported on Friday, citing tender documents the utility posted on its website.
NTPC aims to use the imported coal at power plants that are located far from India’s coal mines, as the energy crisis has depleted coal stocks in the country.
The first tender in two years for overseas coal supply highlights the shortage of the fuel in India, where coal is the major power generating fuel, accounting for 70 percent of total electricity generation.
Currently, more than 91 percent of the coal which top coal producer Coal India is mining is being sent to thermal power plants, as the country looks to avert a major power crisis, The Indian Express reported on Friday.
India is weighing the possibility of keeping strategic reserves of imported coal and natural gas in order to fend off future supply and price shocks, India’s power secretary Alok Kumar said at the South Asia Power Summit earlier this week.
Unless India has a strategy to keep reserves, future high prices “will make energy security very challenging,” Kumar said.
The current coal shortage in India, which has an average of just three days worth of coal in stockpiles, could last for up to six months, Power Minister R.K. Singh said earlier this month.
“I can’t say I am secure… If you have 40,000-50,000 MW (of thermal capacity) with less than three days of stock, you can’t be secure,” Singh told The Indian Express in an interview.
Coal inventories at many of the 135 coal-fired power plants are at critically low levels, while India scrambles to get more coal supply amid a global crunch of energy supply and skyrocketing prices of coal and natural gas.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.