Centre allows tolling of up to 25% for thermal power plants

The government aims to reduce energy production from at least 81 coal-fired plants within 4 years – the business standard

India plans to cut power generation from at least 81 coal-fired facilities over the next four years, in a bid to replace expensive thermal generation with cheaper green energy sources, the federal energy ministry said in a letter.

The plan aims to maximize green energy potential and save costs, said the letter sent to top state and federal energy department officials, but it won’t include shutting down old and expensive power plants. India has 173 coal-fired plants.

“Thermal power plants in the future will operate at the technical minimum to absorb cheaper renewable energy when available,” the ministry said in the letter dated May 26.

India faced a crippling energy crisis in April, when a rapid increase in energy demand led to a scramble for coal, forcing the country to back off plans to cut thermal coal imports to zero.

The increase in peak power consumption during the night when solar power is not available has made the phase-out of coal power generation a major challenge. The addition of alternative sources such as nuclear and hydropower has also been slow.

India is the world’s second largest consumer, producer and importer of coal, and the fuel accounts for nearly 75% of annual electricity generation.

The world’s third largest emitter of greenhouse gases is currently 37% below the green energy target for the end of 2022.

Climb Risk Research Center Horizons said in a report in May that India’s current energy crisis could have been avoided if its goal of installing 175 gigawatts of renewable energy was on track.

Climate Wind Outlook said: “The additional generation from solar and wind energy… would have allowed power plants to maintain diminishing coal stocks for evening peak periods.”

The Department of Energy’s plan to reduce coal power generation when renewables are available could also ease pressure on logistics. India’s electricity crisis has been exacerbated by the lack of trains to transport coal.

The letter said India expects the plan to reduce power generation by 58 billion kWh from 81 facilities to save 34.7 million tons of coal and reduce carbon emissions by 60.2 million tons.

(Additional reporting by Sudarshan Varadan; Editing by Toby Chopra and Jane Merriman)

(The title and image for this report may have been reformulated only by the Business Standard staff; the rest of the content is automatically generated from a shared feed.)

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