Govt sanguine about coal sector in 2018 on demand upswing

New Delhi: The government is looking at 2018 with renewed optimism for the coal sector in the wake of demand upturn and expecting 6-7 per cent growth in supply of the dry fuel next year.

Also, the government is hopeful of a better show by state-owned Coal India (CIL), which is expected to achieve an output of 600 million tonnes (MT) in 2017-18. In 2017, there has been a resumption in demand for coal and this has been the greatest difference from the last year, Coal Secretary Susheel Kumar told PTI in an interview.

Bottlenecks in coal supply to power plants turned out to be a big issue this year. While power producers held the coal ministry responsible for inadequate coal supply, the latter blamed the former for the low stock of fuel at plants.

"Because in 2016, we did not see any demand for coal, that's why all the year (2017), we were requesting power plants to take (coal) supplies... This year, they have been in the overdrive... and we have been trying to cope with (the demand)," the secretary said.

The coal ministry went to the extent of saying that there was no shortage of the dry fuel and power plants should have adhered to the Central Electricity Authority's guidelines for stocking of coal.

"Next year, I see further increase of (coal) demand and I see a better performance by Coal India because now, they (Coal India) have realised that whatever was the position in 2016 is not the normal. Normal is what 2017 is," Kumar stressed.

"So... I am sure that in the remaining months of the year (2017-18) and 2018, we would see robust demand and good supplies," the secretary said. Hoping that coal supply will grow at 6-7 per cent in 2017-18 compared to 2016-17, he predicted that 2018-19 will see a more improved performance.

In October, the Karnataka government had asked the Centre to ensure adequate supply of coal and early allocation of a coal block in Odisha to meet the severe fuel shortage faced by power units.

In the same month, Rajasthan Urja Vikas Nigam had said that power generation at thermal power stations had reduced by 2,700 MW due to shortage of coal, forcing it to resort to load shedding in the state.

Asserting that the bottlenecks in logistics pose a challenge in the year ahead, the secretary said "this year, we have been able to ramp up supply, but it cannot be the case forever".

Stating that after all the demand of the non-power sector has also to be met, he said the coal ministry is in talks with the railways to handle the situation.

"Now that the minister (Piyush Goyal) is the same, I am sure we will find the solution," the secretary added.

Terming the improvement in coal quality as one of the achievements of the ministry, Kumar said "last year, the problem was of quality which I must admit... we identified that and we solved that problem".

Making the point that the satisfaction level of consumers has increased now, the secretary said, "I think a better coordination with the power sector, which is now visible, should be continued."