India asks its coal plants to run flat out to address rising energy crisis

Bloomberg

India’s government ordered coal-fired power plants that run on imported fuel to operate at full capacity to address an escalating energy crisis that’s threatening economic growth.
The government took the unusual step of invoking a little-used provision in electricity laws to bridge a supply deficit that’s causing widespread blackouts. The order is valid until October 31, the power ministry said in a letter posted on its website.
India is facing a crisis as power demand surges amid a blistering summer. Production of coal, the fossil fuel that accounts for more than 70% of electricity generation, has failed to keep pace, and the energy system is expected to come under further strain as
demand tops a recent record in the coming weeks.
That situation has been made worse as global coal prices have surged on tight supply, prompting power plants using imported fuel to operate at reduced capacity to limit losses. Asia’s benchmark Newcastle coal futures have advanced more than 145% this year. Of the 17.6 gigawatts of India’s power generation capacity that’s designed to use imported coal, just 10 gigawatts is currently operating, the power ministry said. Most of the plants have contracts with buyers that do not allow them to pass along rising fuel costs, it said.
JSW Energy Ltd, which runs two such plants, said producing electricity with imported coal has become expensive. Lower generation from these plants coupled with the soaring temperatures are contributing to power shortages, CEO Prashant Jain said in an interview.
Boosting power generation from the curbed plants will help to meet some of the shortfall in the nation’s electricity supply, but won’t alone solve the current problems.