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Coal supplies to non-power sector plants may be kept suspended
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SME Times News Bureau | 13 Oct, 2021
Even as supplies of coal are being ramped up at power plants, supplies to non-power sector plants may be kept suspended.
Southern
Eastern Coalfields, a subsidiary of Coal India has finalised the supply
matrix of coal rakes to critical power plants after a meeting held by
the Coal Ministry.
The power plants where coal rakes will be
provided are Rajpura, HRVUNL, Kawai, Akaltara, Binjkote, DSPM, Pathad,
Sabarmati, GSECL, Uchpanda, Annupur, Seoni, MPPGCL, Amrawati, Warora,
Dhariwal, Tirora, NTPC, and Mahagenco.
Since the supplies of
SECL are yet to be normalised, the supply of coal will be done equitably
to these power plants. "Supplies to non-power sector plants may be kept
suspended till further information," the SECL said.
Meanwhile,
the Aluminium Association of India (AAI) has written to Coal India on
the alarming situation for the industry due to critical coal shortage
and urgency for immediate resumption of coal supplies for survival of
domestic industry.
Despite untiring efforts of the Coal Ministry
and the CIL to support the industry, the current acute coal crunch due
to various factors which has created an immensely precarious situation,
majorly for the highly power intensive industries like aluminium wherein
coal accounts for 40 per cent of the production cost.
Aluminium
smelting requires uninterrupted quality power supply for production
which can be met only through in-house CPPs which operate 24/7 and 365
days, and have signed FSA (Fuel Supply Agreement) with the CIL and its
subsidiaries for assured long term coal supply.
The recent
decisions for stoppage of secured coal supplies and rakes for non-power
sector is detrimental for aluminium industry and will jeopardize the
sustainability as these continuous process-based plants are not designed
for adhoc shut down and start of operations.
Any power
outage/failure (2 hours or more) results in freezing of molten aluminium
in the pots which will lead to shutting down of plant for at least 6
months rendering heavy losses and restart expenses, and once restarted,
will take almost a year to get desired metal purity.
Aluminium
is a sector of strategic importance and an essential commodity for
diversified sectors crucial for nation's economy. Huge investment of Rs
1.2 lakh crore ($20 billion) have been made to double the domestic
production capacity to 4.1 mtpa to cater to the country's increasing
demand. The industry employs one million people and has developed 4000
SMEs in downstream sector.
"The entire industry has been brought
to a standstill and left with no time to devise any mitigation plan to
continue sustainable operations. The coal stocks of operational plants
have depleted to alarmingly low critical stocks of 2-3 days, from the
level as high as 15 days in the month of April, 21, and plants are
forced to operate at reduced power generation with huge risk of closure
with threat of loss of huge employment and deterioration of MSMEs," the
AAI said.
Moreover, the ongoing global aluminium shortage due to
supply demand mismatch is also adding to the woes for industry with the
current coal situation in India.
Adding to the plight of
industry, the exponentially rise in coal prices have created a double
whammy as the global coal prices have gone up exponentially and are on
an upward trend while the ocean freight rates are also at all-time high.
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