India Channels 92.3 Million Tons of Coal to Industrial, Captive Power Units

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Researched by Industrial Info Resources (Sugar Land, Texas)--A new policy announced by India's Coal Ministry will allow captive power plants in the steel, cement and other industrial sectors to enjoy the same status as power utilities and independent power projects when it comes to coal-distribution allotments. The ministry sees the captive plants enhancing the competitiveness of industrial units while reducing the demands on the general power-distribution network.

In the first week of January, the ministry allotted 92.3 million tons per annum (TPA) of coal to ensure long-term linkages to 236 sponge-iron plants, 73 cement manufacturing units and 224 captive power units. The sponge-iron units, in 13 states, have a total production capacity of 41.5 million TPA and have been allowed coal linkages of 19 million TPA. Eighty-four of the plants are in Orissa, 48 are in Chhattisgarh, 36 are in West Bengal, and 27 are in Jharkhand. Fifteen are in Andhra Pradesh, and Karnataka and Maharashtra each have eight. Up to 194 of the units have already started producing 10.38 million TPA of sponge iron with 42 with a production capacity of 4.12 million TPA due to be commissioned soon.

Seventy-three cement plants in 14 states with a total annual production capacity of 116.8 million TPA have been granted linkages of 21.4 million TPA of coal. Forty-three of these plants are being expanded to produce 55.6 million TPA, and 30 are greenfield projects with a projected capacity of 61.2 million TPA. Twenty-four of the units are in Andhra Pradesh with a total production capacity of 46.25 million TPA.

In the steel, cement and other sectors, 224 captive power plants have been approved long-term coal linkages of 53 million TPA under the new liberal coal distribution. Although the majority has yet to be commissioned, these power plants are projected to generate 9,211 megawatts of power.

Faced with constantly rising demand, the new policy allows the state's Coal India Limited to import coal if required to meet distribution linkage commitments with various industrial sectors.

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