Coal in India

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Figure 1. World energy consumption600050004000Mtoe3000200010000OECD other Non-OECD China IndiaSource: IEA 2014d.India’s energy consumptionhas grown substantially overthe past forty years.India’s energy consumption has grown substantially over the past fortyyears, with the average growth rate increasing in the new millennium.Robust economic growth, an expanding middle class and growing populationhave underpinned this growth, all of which are trends that are unlikely tochange in the near term. Nevertheless, the challenges facing India’s energysector are immense. Despite the extended period of high growth in energyconsumption, energy poverty remains a significant issue in India. TheInternational Energy Agency (IEA) estimates that 304 million people (around13 times Australia’s total population) are unable to access any electricityand many of those that have access experience regular supply disruptionsthat necessitate expensive diesel back-up generators (IEA 2014c). To date,plans to develop new electricity generation capacity have fallen short ofthe government’s ambitions and targets. Despite these shortfalls, therehas still been substantial growth in India’s electricity consumption and thishas primarily been met through increased use of coal. Even though it hassubstantial coal resources, India’s coal mining sector has been challengedby the growth in demand and the domestic supply response has not kept up.India’s electricity markets and the coal mining industry in India are heavilyregulated and mostly managed by public institutions and both experiencesystemic supply disruptions. The large scale blackouts in northern andeastern India in July 2012, when up to 600 million people lost electricityaccess, epitomised the ongoing weaknesses in energy policy and delivery,including lack of generation and transmission capacity, control and coordinationissues, and inadequate energy supply.18COAL IN INDIA 2015
Coal is expected to play a major role in addressing some of India’s energychallenges. Reflecting its large domestic reserves, coal is already a majorcomponent of India’s energy supply, accounting for 45 per cent of its totalenergy mix, 60 per cent of installed electricity capacity and 71 per cent ofelectricity generation in 2012. Given the plans for investment in new coalfiredcapacity, coal will continue to be a major component of India’s energymix over the longer term.One of the key challenges facing India is balancing the energy needs of itspopulation and growing economy with the global move to reduce carbonemissions. While investment in renewable energy sources is undoubtedlyon the rise in India, there is even greater investment already underway intocoal-fired electricity generation which indicates that India’s coal consumptionis likely to rise for some time. What remains to be seen is the role HighEnergy, Low Emissions technologies (HELE), such as ultra-supercriticalgenerators, and carbon capture and storage will play in India’s energymarkets. Both have the potential to provide significant reductions in carbonemissions, but come with higher capital costs.This report focuses on the trends, policies and market structures that areshaping India’s electricity and coal mining industries both in the short andlong term. It discusses the long term outlook for India’s coal consumption,production and trade by analysing the market structures, regulatoryenvironment, electricity consumption trends and investment that underpinthem. The first chapter provides an overview of India’s electricity and coalindustries including the role of government, market structures and regionalconsumption patterns. The second chapter discusses current policies andreforms that are underway with an assessment of the effects that these mayhave on India’s coal consumption and production.Chapter three reviews the IEA outlook for India’s coal demand andsupply in the 2014 edition of the World Energy Outlook including someof the challenges to meeting planned targets. The report concludes witha discussion on the implications for Australia as a major coal exporterand potential investment destination. This report also includes a series ofappendix that provide some background information on coal as a commodity,its use in electricity generation, HELE technologies, mining methods used toextract coal and trends in world coal use at the end of the report.INTRODUCTION19
Page 1 and 2: Coal in India2015WWW.INDUSTRY.GOV.A
Page 4 and 5: Further informationFor more informa
Page 6 and 7: ContentsABBREVIATIONS AND ACRONYMS
Page 8 and 9: Figure 8. India’s electricity use
Page 10 and 11: Abbreviations andacronymsAUSCCCSCIL
Page 12 and 13: Executive SummaryIndia is the world
Page 14 and 15: Coal is an important part of India
Page 17: IntroductionIt has been clear for s
Page 22 and 23: and have responsibility for energy
Page 24 and 25: it has Maharatna status, which give
Page 26 and 27: Coal production in Indiahas been co
Page 28 and 29: Table 1. Conversion equivalents bet
Page 30 and 31: Figure 6. India’s energy mix40035
Page 32 and 33: Goa consumed around 2300 kWh per pe
Page 34 and 35: Figure 10. India’s electricity ge
Page 36 and 37: involves the payment of bribes to o
Page 38 and 39: India’s power sector hasbeen maki
Page 40 and 41: Figure 13. India’s installed coal
Page 42 and 43: The average efficiency ofIndia’s
Page 44 and 45: Figure 16. India’s proved coal re
Page 46 and 47: Table 2. Indian thermal coal classi
Page 48 and 49: Coal producersGovernmentCIL is the
Page 50 and 51: have increased rapidly over the pas
Page 52 and 53: 2009, growth in India’s coal impo
Page 55 and 56: Modi Governmentpolicies, reforms an
Page 57 and 58: competitive. As India’s economy d
Page 59 and 60: 2005 levels, by 2020. This does not
Page 61: In order to promote a rapid increas
Page 64 and 65: 2017 at the earliest and announced
Page 66 and 67: is projected to more than double in
Page 68 and 69:
the largest coal users are projecte
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coupled with anticipated reforms to
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Figure 27. Share of world thermal c
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A number of private Indian companie
Page 76 and 77:
The lengthy approvalprocess has cau
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Implications forAustraliaCoal has b
Page 81 and 82:
Figure 30. Key coal price indicator
Page 83:
with lower ash levels than most of
Page 86 and 87:
Coal characteristicsCoal is a combu
Page 88 and 89:
lignite varies between 2200-4600 ki
Page 90 and 91:
The widespread availability of coal
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is allowed to collapse. Up to 75 pe
Page 94 and 95:
Figure 36. Coal-fired power plant s
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more strain on plant components and
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Carbon capture and storageCarbon ca
Page 100 and 101:
Figure 39. World coal consumption,
Page 102 and 103:
Das, K.N. & Paul, S. 2015, ‘As In
Page 104 and 105:
Ministry of Coal (MOC) 2014a, Funct
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Coal in India

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