A Grim Situation
India's power situation is in critical condition as on average, 135 coal-fired thermal power stations are not in a comfortable position with production and dispatches from coal mines falling short of demand. This is worrisome because coal-fired plants make up nearly 70% of India's power source mix. Therefore, any supply disruption caused by accidents at mines, extreme weather events, labor strife and logistics problems can affect electricity generation and in turn lead to many problems.
India is the second largest importer, consumer and producer of coal, and has the world's 5th largest reserve. The reason behind the current power crisis, according to the power ministry are heavy rain in coal mine areas in September adversely affecting food production as well as the transport of coal from mines, steep rise in the price of imported coal, leading to sharply reduced power generation from imported coal based power plants and more dependence on domestic coal, failure to build adequate coal stocks before the onset of monsoon, there are also legacy issues of heavy dues of coal companies from certain States Maharashtra, Rajasthan, Tamil Nadu, Uttar Pradesh and Madhya Pradesh, a surge in the economy after the second wave of covid led to a big increase in demand and consumption of electricity. The current crisis can spawn many troubles such as it could delay India's economic reopening, some business may downscale productions it could hit long and hard.
However, the Government is working to closely monitor stocks and also state run Coal India and NTPC are working to raise output from mines to boost supply, Also, the government must increase import and also invest its underdeveloped energy infrastructure. India should take this event as a blessing in disguise as it should use this opportunity to scale up its renewable capacity, slashing its dependence on coal.
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