Coal deficit to touch 104 mn tonnes by 2012 - Country is once again going to face severe power crunch in the coming few months

The country is once again going to face severe power crunch in the coming few months. The reason is the eternal problem of coal shortages which is expanding by leaps and bounds year after year.

According to the latest estimate released by the ministry of Coal, the country's coal shortfall is likely to touch 104 million tonnes by the end of 2012. The indications come at a time when the ministry is grappling with revised coal production estimates. Earlier, for the 11th Five-Year Plan period (2007-12), the planning commission had decided to reduce estimated annual coal production from 680 million tonnes to 630 million tonnes. The revised estimate includes 486 million tonnes to be supplied by Coal India Limited (CIL), and 81 million tonnes from captive coal mines.

However, the latest reports indicate that India may not be able to achieve the revised coal production target of 630 million tonnes, as output from captive coal mines is likely to slump from 81 million tonnes to 43 million tonnes.

Experts observe that India's total coal production at the end of 2007-12 may eventually reach 592 million tonnes, instead of the revised target of 630 million tonnes. Sharing details regarding coal imports, the planning commission has indicated that the coal demand-supply gap during this period will be in the range of 104 million tonnes to 121 million tonnes.

Commenting on the need to increase coal imports, Shriprakash Jaiswal, minister for coal, has said that the rising demand for coal is expected to increase global market rates, making coal imports more expensive. Planning commission representatives have urged the ministry of coal to develop an action plan and take immediate steps to avert a coal and energy crisis in the 12th Five-Year Plan (2012-17).

Coal ministry officials have raised concerns over the ministry of Environment and Forests' (MoEF) categorization of coal mines as "no go" areas. Private power producers are protesting against the stringent policy adopted by MoEF for clearance of coal blocks that are located near endangered wildlife sanctuaries and forest areas. The policy has delayed several projects.

Ministry reports suggest that the "no go" categorization has left 203 blocks with combined reserves of 600 million tonnes in limbo. These coal mines were expected to provide fuel for 50,000 MW in power projects. To expedite coal mine development, the Indian government has released a list of 93 companies, out of which notices have been sent to 50 firms for lack of progress. Private players argue that the competitive bidding procedure adopted by the coal ministry for allocation of coal blocks is another deterrent to development.