Coal in India: shortage highlights the need for renewable energy

The mercury soared above 49C in parts of the capital, Delhi, in mid-May, as an intense heatwave swept through northern India. This was the fifth heatwave in the capital since March.

An increase in the use of air conditioners to beat the heat, and an economic recovery due to the removal of all Covid-related restrictions on industrial activity, triggered an unprecedented increase in electricity demand.

Photograph: iStock, credit Arjun Sanghani

In the previous year, India’s maximum electricity demand was 200.539 gigawatts (GW) on 7 July. This year, the country had already hit the same level of demand in April.

The unprecedented demand has outstripped India’s available energy supply, leading to long power cuts in many regions and uncertainty over whether other regions will also face serious interruptions to their electricity supply.

Seventy per cent of the electricity produced in India is generated by coal-fired power plants.

Low coal reserves
In an interview with the news agency PTI, secretary at the Ministry of Coal Anil Kumar Jain said the low coal reserves at electricity generating plants were being caused by several factors. These included heightened power demand due to the boom in the economy post Covid-19, the early onset of summer, a rise in the price of gas and imported coal, and a sharp fall in the amount of electricity generated by coastal thermal power plants.

As electricity consumption reached a record high during the heatwave in April, Union Power Minister RK Singh asked states to increase their coal imports for the next three years to build up coal reserves and satisfy demand. This move reversed a major government decision to rely less on imported coal.

Recently, over 43 per cent of the electricity generating power plants fired by imported coal, which have a total capacity of 17.6 GW and account for 8.6 per cent of India’s total coal-fired power capacity, were idle. Power ministry officials therefore decided to invoke an emergency clause in the country’s electricity law to allow the plants to run.  

Earlier in May, Jain said India expects to increase its coal production by up to 100 million tonnes in the next three years by reopening a number of closed mines.

Ramping up coal production
In an attempt to provide more coal to help the electricity-generating plants meet the nation’s power demands, state-run Coal India, which accounts for 80 per cent of domestic coal output from India’s mines, ramped up production and increased its supplies to electricity power plants to 49.7 million tonnes (mt) in April, compared to a supply of 43mt in the same period last year.

The country’s largest coal miner supplied 1.66mt of coal per day to the power utilities industry in April, and the supplies increased to 1.73mt during the final week of the month.

To keep up with the demand, Coal India increased its production to 53.5mt, a growth of around 28 per cent compared to 41.9mt in April 2021. All the subsidiaries of the company have registered year-on-year growth in coal production, the company said.

In fact, coal output from Coal India for April 2022 was the highest ever recorded for the month of April, surpassing the previous peak of 45.3mt achieved in April 2019.

However, although thermal power plants usually have coal operating reserves of approximately 21-26 days, data from the Central Electricity Authority (CEA) showed that on 29 April 2022, as many as 100 plants out of the 165 operational were at the critical storage stage. These plants had less than 25 per cent of the required reserves, which is seven days of coal burning.

“I am not worried for today, I am worried for the monsoon,” Union Power Minister RK Singh told Times of India. “There is no shortage of coal right now for generating power today. As I am getting my daily supply. If we don’t push up supplies then I will have a shortage of coal in the monsoon. We have reserve stocks of around 19.5 million tonnes. If I have 35-40mt, that will be great.”

However, the two main reasons for the acute coal shortage at electricity-generating plants appear to be the insufficient supply from India’s mines and a shortage of rail capacity to deliver coal to the electricity generating plants.

In recent months, the State-run Indian Railways has cancelled passenger trains to free up tracks for the movement of coal to the electricity-generating power stations.

“This is the first time that the Indian Railways, which carries more than 60 per cent of nearly one billion tons of coal consumed in India, is forced to cancel more than 1,000 train trips (in the congested east-north routes) during the summer vacations to transport coal to power plants,” noted R Srikanth, professor and head of the Energy, Environment and Climate Change Program at the National Institute of Advanced Studies, Bengaluru.

On 6 May, at a conference aimed at attracting more private companies and investors into India’s coal mining industry, Union Coal Minister Pralhad Joshi said: “Not long ago, people would say the need for coal is going to reduce but we are currently witnessing a surge in demand for coal.
“While we are stressing on developing renewable sources of energy, coal is also going to be one of the major contributors in energy production.”

Investment needed in renewable energy
However, many commentators argue that the current power crisis is an important reminder that India needs to invest more in its renewable energy generating capacity to secure its future energy needs.

India is the world’s third largest consumer of electricity and the world’s third largest producer of renewable energy, with 38 per cent of energy capacity installed in the year 2020 (136GW of 373GW) coming from renewable sources. The renewable energy sources are wind power, solar power, biopower, small hydro power and large hydro power.

Another promising source of energy is green hydrogen. Commentators point out that if India can manufacture green hydrogen at competent prices, this will enable the country to both become an energy export hub and become self-sufficient in meeting its own future energy needs.

Although the Indian government has committed to increasing the country’s renewable-energy capacity to 450GW by 2030 to help wean India off its dependence on coal, the promises around expanding supplies of renewable energy haven’t halted the growth in the use of coal to power existing electricity-generating power stations.

A new analysis by the think tank Climate Risk Horizons found that India could have averted the power crisis that occurred in April if progress towards the country’s goal of achieving 175GW of renewable energy capacity had been on track.

In 2016, India set an ambitious goal of reaching 175GW of renewable energy capacity by 2022.

However, in April 2022, the country had only 95GW of operating solar and wind power, which implies a target slippage of about 51GW.

Commenting on the recent coal shortages at electricity generating power stations, analysts say there was no shortage of coal stocks at the mines, nor was there a shortage of installed coal power generation capacity at the power stations. Instead, the crisis was the result of lack of coal supply, due to logistical and cashflow reasons.

“Two things are true: without the massive renewable growth since 2016, the power crisis in April would have been much, much worse,” said Ashish Fernandes, CEO at Climate Risk Horizons “At the same time, if we had been on track for 175GW by the end of the year, there would have been no power crisis at all.”

Photograph: iStock, credit Supratim Bhattacharjee

Coal burning and air pollution
Meanwhile, the Lancet Countdown 2019 on health and climate change cautioned that the impact of air pollution in India will worsen if the country does not shift from coal-based energy.

More than 500,000 people died prematurely in India in 2016 due to dangerous levels of outdoor air pollution and over 97,000 of them died after being exposed to pollutants from coal burning, the report revealed. 

A Greenpeace report released in February 2020 estimated there are one million deaths each year in India due to air pollution generated from burning fossil fuels. The Greenpeace analysis also suggests that exposure to pollution from fossil fuels leads to around 490 million days of work absence due to illness.

When coal is burned, it releases a number of airborne toxins and pollutants, including mercury, lead, sulphur dioxide, nitrogen oxides, particulates and various other heavy metals. These cause respiratory and other diseases and are important sources of morbidity and mortality.

Sulphur dioxide (which contributes to acid rain), nitrogen oxides (which contribute to smog), and particulates (which contribute to smog and haze), cause respiratory illnesses and lung disease. Mercury and other heavy metals have been linked to both neurological and developmental damage in humans and other animals.

Analysts emphasise that India’s priority should be to clean up its coal instead of wishing it away.
India’s coal is high in ash – about 35 per cent or more - which makes it very polluting.

According to a study by the International Energy Agency’s Clean Coal Centre (IEACCC) released in February 2021, unabated burning of coal in thermal power stations and a delay in implementing the latest carbon-capture storage technology are among the major reasons for air pollution in India.
Coal-based thermal power stations with no pollution control technology are responsible for over 50 per cent of sulphur dioxide, 30 per cent of oxides of nitrogen, about 20 per cent of particulate matter, among other man-made emissions in the country. 

The study, which recommended implementation of emission norms at coal-based thermal power stations as soon as possible, said it was technologically and economically possible to meet the norms if there were no further delays or dilution.

'Decommission older coal-fired power stations to reduce air pollution'
The IEACCC study also suggested that some older, coal-fired power stations should be decommissioned to limit air pollution and improve the overall efficiency of the country’s coal-fired electricity generating plants. The study noted the “lip-service stand” taken by the Union government in running cleaner coal power plants in India.

The study also concluded that transport and other industrial sectors are actually the second largest contributor to air pollution in India, after coal-based thermal power stations.

The Union government’s long-term strategy underlines the nationally determined contributions (NDCs) submitted by India as part of the 2015 Paris Agreement aimed at tackling climate change. The NDCs mention the Indian government’s intention to run cleaner advanced technology. However, it is legally feasible for businesses in India to use less efficient technologies to burn coal.

India’s current energy efficiency schemes – including the ‘performance and achieve’ trade scheme, efficiency standards scheme and carbon pricing schemes – are not ambitious enough to drive significant improvement, noted the study. A noticeable change will only come if inefficient coal-fired power stations are decommissioned and clean coal technology is adopted, it said.

“The coal-fired power plants at the pithead are the least-cost sources of 24x7 power in India,” said Professor R Srikanth, from the National Institute of Advanced Studies in Bengaluru.

“Coal will therefore continue to play a critical role in raising the living standards of all Indians over the next three decades even as the generation capacity of other non-fossil fuel sources (solar, wind, hydro, and nuclear) increases to decarbonise the power sector.

“Therefore, it is important for the government to ensure that coal is mined, transported, and used in an environmentally-friendly manner.”

‘Rapid scale-up’ of renewable energy sources needed
So, isn’t it time to rethink India’s energy mix? Yes, say experts.

“Logistical constraints in the coal supply chain are a permanent feature and will certainly recur, as will heatwaves; the best safeguard is to diversify our electricity mix. This reinforces the need for the centre and state governments to rapidly scale up their renewable [energy] deployment and reduce dependence on coal,” said Ashish Fernandes, CEO of Climate Risk Horizons.

Shwetal Shah, technical adviser in the climate change department at the Government of Gujara, added: “While India contributes way less to the global emissions pie, the decision to reduce climate impacts for its large vulnerable population will have to be the main driver while making energy choices now.”

Incidentally, since 2019, Gujarat has decided not to invest in new coal-based power plants. Currently, 16,700MW of the state’s installed power capacity is from renewable sources, and it is committed to meeting any increase in power demand only through renewable sources.

“This choice is largely influenced by the falling prices of wind and solar power, and the threat of thermal power plants becoming “stranded assets” in the future, owing to the threats and risks coal investment poses,” said Shwetal Shah, from the climate change department at the Government
of Gujarat.