Coal Ministry Encourages CPSEs' Diversification for Operational Sustainability

In order to prepare for the future of India’s Coal Sector, the Ministry of Coal has been proactively promoting large scale diversification among CPSEs. In line with this, NLCIL is all set to establish two thermal power plants. One plant is being set up in Ghatampur near Kanpur, will generate 3 x 660 MW power at a cost of Rs. 19,406 crores. A joint venture between NLCIL and the Government of Uttar Pradesh, the project will be supplying 1478.28 MW to Uttar Pradesh and 492.72 MW to the state of Assam. The project has been into implementation phase and the first phase of this plant is expected to start generating power by the end of this year.

In addition, NLCIL has formulated plans to construct a 3 X 800 MW pithead thermal power plant at Talabira in Odisha. The project cost is estimated at Rs 19,422 crores and it will supply 1450 MW power to Tamil Nadu, 100 MW to Puducherry and 400 MW to Kerala. The project is expected to begin by the end of this year and likely to be completed by 2028-29.

Coal India Ltd (CIL) is also in the process to establish two thermal power plants. One, located near Amarkantak as a joint venture with the Madhya Pradesh Government. The planned capacity for this plant will be 1x660 MW, with an estimated cost of Rs. 5,600 crores. Currently, the project is in the advanced stage of approval and SECL, a subsidiary of CIL, will invest Rs. 857 crores as equity. The project will be executed through a joint venture between SECL and Madhya Pradesh Power Generating Company Ltd. The work of this project is expected to commence by the end of this financial year, with completion targeted for 2028. Required land for the project has already been arranged.

Moreover, Mahanadi Coal Fields Ltd (MCL), another subsidiary of CIL, has set up Mahanadi Basin Power Limited, as a fully owned subsidiary. MCL plans to establish a 2x800 MW thermal power plant near its Basundhara Mines. This pithead plant, with an estimated cost of Rs. 15,947 crores, has received interest from different States for 4000 MW worth Power Purchase Agreements (PPAs). Work on this project is expected to begin around the middle of next year and targeted completion date is set for 2028.

The Ministry of Coal has advised all subsidiaries of CIL to find suitable de-coaled land for establishing new pithead thermal power plants. Setting up power plants at pithead is more cost-effective, with a tentatively fixed cost of approximately Rs. 2.5 and a variable cost of about Rs. 1.25 per unit, making it possible to generate power at less than Rs. 4 per unit. This decision comes as coal is projected to be surplus in the future, and it aims to ensure sustainability in operations for CIL and NLCIL with setting up of new thermal power plants.

As per the policies of the Ministry of Power, required renewable energy potential is also been created along with the thermal power plant so that the power generation can be augmented with the combination of thermal as well as solar. This will help to supply power in cost effective manner to the end users.