Increase in coal production helped lower power price: Western Coalfields


Western Coalfields Limited (WCL) has increased the production of coal to 57.6 million tonnes in fiscal year 2019-20 and provided it cheaply to government and private thermal power stations in Central, West and South India. The move has helped thermal power producers to reduce the rates of electricity supply to consumers, said WCL on Tuesday.

WCL is a subsidiary of Coal India Limited (CIL). In 2013-14, its coal production dropped to 39 million tonnes. Because of this, some of WCL's biggest customers like Maharashtra State Power Generation Co Ltd. (MAHAGENCO), Madhya Pradesh Power Generating Co. Ltd. (MPPGCL), Gujarat State Electricity Corporation Limited (GSECL) and Karnataka Power corporation limited (KPCL) along with some private companies, had to buy coal from CIL's other subsidiaries, like SECL, MCL and SCCL. But the longer distance led to higher transportation cost being added to production rates.

According to WCL, in the last five years, it has opened 20 mines with a capacity of 45.64 million tonnes. These mines produced 35.8 million tonnes of coal in fiscal 2019-20. As a result, the company's production increased to 57.6 million tonnes and it was able to meet the coal demands of its customers.

MAHAGENCO is one of the biggest consumers of WCL's coal, with 50% of it going to the said power generator. According to WCL, it supplied 17.60 million tonnes of coal to MAHAGENCO during the fiscal year 2013-14. It increased its supply to 27 million tonnes in the fiscal year 2019-20. "Owing to the additional purchase coal from WCL, MAHAGENCO was able to save an average of Rs 1,200 per ton in freight/rental," said WCL in a statement.

In order to make more coal available to energy consumers, WCL has also identified 11 mines as "mine specific sources" dedicated to the power sector.

WCL plans to increase production from the current 57.6 million tonnes to 75 million tonnes by the fiscal year 2023-24 and 100 million tonnes in 2027-28.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel