Aluminium industry seeks more railway rakes for coal supply
The aluminium industry has sought the intervention of the government to ensure its operations are not disrupted due to the coal shortage. In a letter to the secretary in the Union coal ministry, the Aluminium Association of India (AAI) has requested “earmarking at least 25-30 coal rakes per day for economically viable and sustainable industry operations”.
Even after the power sector coal inventory situation improved to around 10 days from 2-3 days recorded in September–October 2021, AAI claimed that though there is improved coal availability, most of the railway rakes are being diverted to power plants as “priority coal supplies”.
With the government taking several steps to address the issue of coal shortage at numerous power plants across the country in September-October 2021, other industries — which run captive electricity generation units to supply electricity to its factories — have been complaining about the fuel crisis brewing in the sector.
AAI’s letter, reviewed by FE, stated that there is a cumulative backlog of over 6,000 coal rakes which are expected to be supplied to the captive power plants, and current fuel stock is enough to sustain them for only 2-3 days.
Coal supply to captive plants by Coal India Ltd had marginally increased to around 82 million tonnes (MT) in April-November 2021 from 79 MT in the same period a year ago. However, since there was an urgency to stock power plants to address their fuel shortage, the share of the state-run company’s supply to the non-power sector fell to 19.5% in April-November 2021 from more than 22% a year ago.
As FE reported earlier, the coal supply shortage had pushed the industry to resort to imports with international coal rates trading around Rs 12,000 per tonne. Aluminium is a highly power-intensive industry where coal accounts for around 40% of production costs. To reduce the dependency on the grid, around 9,000 megawatt of captive power plants have been set by the industry to meet their critical need for uninterrupted quality power supply.