India Running Short on Coal; Could Force the Country to Increase Imports

India is running dangerously low on coal and the country could be forced to increase imports so power plants can generate enough electricity.

State-owned Coal India Limited (CIL) has been asked to increase coal production at existing mine as production has been failing to meet targets and more imported coal has been required. India’s electricity shortage climbed to 7,000MW in May.

"We hope that a good amount of additional coal can be mined at least as an interim measure for a few years till we are able to sort out the problem which the sector has faced over the last five to six years," power minister Piyush Goyal said.

Although India already imports nearly 20 percent of its coal requirements, Goyal is requesting the company import more despite increased costs. India’s power plants are not running at optimum levels and more coal is required to help ramp up production.

India’s net coal-fired electricity generation is expected to grow by a total of 910 terawatt hours from 2010 to 2040, doubling its total in 2010. India’s coal consumption for electricity generation is expected to double.  

According to professor John Rolfe of CQUniversity, Australia could be a viable option for coal supply.

He said the election of Narendra Modi as Prime Minister for India will help grow the country’s economy faster.

"The previous government were quite successful in the early stages at economic growth but over time that growth slowed and they ran into lots of problems trying to get major changes through the different states of India,” Wolfe said.

"Modi's a breath of fresh air, he's also got a much bigger mandate, so he'll have a lot more power to make major changes in the economy.”

The demand for coal in India is forecasted to reach 551.60 million mt in 2015 as supply of coal is predicted to amount to just 466.89 million mt.