Strange times ahead for the coal sector

As CarbonCopy reported in the middle of last year, India’s energy policy is distinctly muddled.

By 2030, the ruling NDA government says oil demand will double; and gas demand will treble. It has also told Coal India to boost coal production to one billion tonnes by 2024 – up from 600 million tonnes in 2018-19 – and replace imported coal. It is also auctioning coalblocks to commercial miners.

In tandem, the country has an ambitious renewable energy target — 450 GW by 2030, up from the current 86 GW. Big plans aside, India’s economy is not growing fast enough to absorb all this ambition.

One fallout? In the absence of a policy roadmap, pricing will determine whether India will see an energy transition.

In September last year, CarbonCopy began taking a closer look at the economics of India’s principal fuels. We started with the government’s claim that gas would account for 15% of India’s energy mix by 2030 – and concluded domestic gas is too limited, and imported gas not competitive enough, for that to happen. Coal is a different story. It’s cheap. But the industry which consumes most of it – coal-based power – is shedding competitiveness.

And so, this three-part series on where India’s coal sector is headed.

The first part lays out the context for why cos like CIL, NTPC and Adani need to pivot.

PS: The book is done. Most of my promotional work for it is done as well. As is the tiredness that settled upon me after the book went to press. And so, it’s now time to get back to writing on energy. I did some work last year — on global fossil fuel majors making a beeline for India — and attendant implications for our emissions; and, notwithstanding the government’s rosy numbers, the uncompetitiveness of the Gas sector in the country and the consequently high costs of pushing Gas. It is now time to get into deeper waters. Net Zero. Solar. Green India Mission. Electric Vehicles. Everything is awaiting a closer look. Gotta focus.

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