Published on September 30th, 2013 | by Mridul Chadha9
World’s Largest Coal Miner To Run Out Of Reserves In 17 Years, Claims Greenpeace
In a startling revelation, Greenpeace India has claimed that the world’s largest coal miner, and essentially India, could run out of recoverable coal reserves within 17 years. Coal India Limited is the world’s largest coal mining company and enjoys a monopoly in the Indian coal sector.
The Indian government has announced extremely ambitious plans to add coal-based power generation capacity over the next few years. The country plans to add almost 100 GW of coal-fired power plants by 2017. A number of these projects are planned to use the ultra super critical technology which has lower carbon intensity than conventional coal-based power plants.
In 2011, India’s coal demand was 640 million tonnes. This figure is set to increase rapidly as the country plans to add significant capacity over the next few years. Recently, Coal India Limited signed over 150 fuel-supply agreements with new power plants. The company admits that it would not able to provide 100% of the demand of the power plants through its domestic mines and will have to import about 15-20% of the demand from other countries.
According to the recently adopted United Nations Framework Classification for Fossil Fuel and Mineral Resources, Coal India’s recoverable reserves stand at 17.15 billion tonnes; Greenpeace India pegs recoverable reserves of non-coking coal at 15.4 billion tonnes. At the expected rate of production (government intends to meet maximum demand from domestic sources to keep electricity tariffs low), these reserves will be exhausted by within the next 13 years.
Greenpeace India has noted several reasons as to why Coal India would have a tough time increasing its recoverable reserves. Lack of technical know-how to mine at greater depths and slow pace of exploration growth over the last few years are among the reasons mentioned by Greenpeace India. Another major obstacle being faced by the company are environmental clearances. According to media reports, 241 coal mining projects are currently awaiting environmental clearances from either the state governments or the central government.
Coal India has, expectedly, rejected the claims made by Greenpeace India. The company claims to have been adding over 2 billion tonnes of reserves every year and hopes to increase the production to 482 million tonnes in 2013-14.
While this year the electricity demand has been lower than last few years, possibly due to the better than expected monsoon and increased grid strictness on overdrawing electricity following last year’s grid collapse, several power plants in India had been regularly facing a situation of critical or super critical coal reserves. On a number of occasions over the last few years, power plants were left with only few days worth of coal reserves to operate. A number of power plants have to regularly shut operations due to lack of coal, or other various reasons.
The situation on the gas front is even worse. The Ministry of Power has banned any new gas-based power plants till 2016 simply because the country does not have gas reserves to fuel the power plants. A number of private power generating companies are planning to use coal in their gas-based power plants.
This brings renewable energy to the forefront of India’s energy predicament. The wind energy sector is well established in the country and experts expect solar power to become competitive over the next few years, the capacity that India requires to meet the rising demand is truly enormous. India could soon surpass Russia to become the third largest country in terms of electricity consumption. Renewable energy has a long way to go before it can claim a significant share in the country’s energy mix; but it this report by Greenpeace India should be treated as a wakeup call for the policy makers and the industry.