India has ordered 112 captive coal-fired power plants to operate at maximum capacity from October 1 through the end of December as the government prepares for stronger electricity demand and increasingly strained coal inventories.
The federal Power Ministry invoked emergency provisions of India’s Electricity Act for plants with installed capacity of at least 50 megawatts. The directive is intended to address an expected increase in electricity demand during the coming months.
The affected generators primarily serve major industrial operations including steel mills, aluminum smelters, cement plants and oil refineries.
Companies covered by the directive include Vedanta, Tata Steel, Hindalco Industries, JSW Steel, UltraTech Cement, Reliance Industries, Indian Oil, Bharat Aluminium, Hindustan Zinc and Nayara Energy.
The government also instructed operators to sell surplus electricity through power exchanges and submit weekly reports covering generation, captive consumption, electricity sales, available capacity and coal inventories.
Fuel availability is becoming increasingly important. Nearly 40% of India’s coal-fired plants are operating with critically low fuel stocks, according to Reuters, as elevated temperatures associated with El Niño contribute to stronger electricity demand.
The ministry separately extended an emergency directive requiring Tata Power’s imported-coal Mundra plant in Gujarat to operate at full capacity through December 31.
The intervention underscores the tension between India’s rapidly expanding electricity requirements and the reliability of the country’s fuel supply.
For industrial companies, the directive could affect how captive generation is allocated between their own operations and the wider electricity grid. For energy markets, sustained high coal consumption increases the importance of domestic coal production, transportation infrastructure and potentially imported fuel.
The immediate question is whether coal deliveries can keep pace with generation requirements as India enters the fourth-quarter demand period.
