Eighty-one thermal power plants are running on critical coal stocks, up from 73 a week ago. As electricity demand rises, supply fails to meet the daily requirement of 2.95 million tonnes. Sources said, “Coal consumption is high as industrial demand is strong, led by steel and cement production.”
As thermal power plants (TPPs) burn more coal to meet electricity demand, the supply seems to be failing to meet the daily requirement with 81 plants based on domestic coal running on critical stocks compared to 73 a week ago.
For instance, the Coal Ministry, on Monday, said that 1.75 million tonnes (mt), 1.87 mt and 1.81 mt was dispatched by Coal India (CIL) on October 1-3, respectively, which averages at 1.81 mt. However, the daily requirement of 176 domestic coal-based (DCB) plants with roughly 207 gigawatts (GW) capacity is around 2.95 mt per day.
Coal stocks at DCB plants stood at 18.22 mt on October 5, a decline of 3.8 per cent compared to stocks a week ago (September 29).
Higher cdemand
Sources said that Punjab, Haryana, Maharashtra and Uttar Pradesh are facing higher demand. The requirement from TPPs is high, as hydro-power generation this time was down roughly 12 per cent in September. Besides, evening and night peak electricity demand has also been on the higher side putting more stress on TPPs.
“States such as Punjab have asked for more supply from the resource pool. Coal consumption is high as industrial demand is strong, led by steel and cement production. Over that, power is also being consumed in the farm sector as deficient rains are leading to more use of pumps for irrigation,” said one of the sources.
During July-September, India’s energy consumption rose 11.5 per cent year-on-year to roughly 502 billion units (BU). The consumption last month was at 162 BU, higher by 11 per cent on an annual basis.
Lack of power supply forced Discoms to buy from power exchanges. For instance, the Indian Energy Exchange said that strong power demand led to a whopping 281 per cent increase in buy bids in the Day-Ahead Market in September, resulting in higher market prices.
The average market clearing price in the Day-Ahead Market at ₹7.3 per unit during September, increased 105 per cent. Similarly, the average market clearing price in the Real Time Market at ₹6.9 during September, increased 108 per cent.
While coal receipts rose 6 per cent in August and 3.3 per cent Y in April-August FY27, coal consumption rose 12.5 per cent in August and 9.2 per cent in April-August.
Stress on TPP
An official indicated that the stress on TPPs can be assuaged from the fact that September experienced a power deficit of 560 million units, which is the highest in at least the last two-three years.
The Power Ministry, anticipating an electricity shortfall, directed captive power plants last month to maximise generation and supply surplus electricity for sale through exchanges in anticipation of rising consumption during the high demand October-December period.
The International Energy Agency (IEA) has said that it expects higher coal burn in India by TPPs during 2026, citing that El Niño conditions can heighten cooling demand. It will likely push up consumption by 4.2 per cent to 1,353 mt in CY26.