Thermal Power Update - Will The Coal Shortages Trip The Recovery?: CARE Ratings' Take
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CARE Ratings Research Report
With the ramp-up of economy post the second wave of Covid-19 outbreak, power demand has increased significantly.
The base demand during April to August 2021 period has shown a robust growth of 15.5% over the corresponding period last year and has already surpassed pre-Covid-19 levels (i.e. April to August 2019 period).
While the coal-based thermal plants experience lower coal availability around September every year due to the issues related to production, monsoon and concomitant logistics challenges, this year the issue has been exacerbated by sharper surge in power demand.
Higher demand this year has resulted in sharp depletion of coal inventory with ~54% of the monitored capacity of 165 gigawatt having a stock of less than four days of production, as on September 30, 2021.
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