Government mulls 6 mega power plants near coalfields

NEW DELHI: In a bid to reduce the country’s reliance on expensive coal transportation for electricity generation, the coal ministry is planning to set up massive power plants around its coalfields across the country.

These coal-based power plants, each with a capacity of 5,000 megawatts (total 30 GW capacity), will

be built in the coal fields of Chhattisgarh, Odisha, and Jharkhand. According to the coal ministry, each power plant will be established through joint ventures (JVs) with the government, private power companies, and state-owned electricity generators.

Under the terms of the JVs, the state-owned coal companies will have a stake or equity in the power plants, and in return, the Coal Ministry will provide adequate land, coal, or funds.

To kick off the project, the ministry is creating land banks or acquiring land around its coalfields, and the work on the projects will begin once the general election is over.

“We are already in talks with power companies to set up these plants right next to the coal mines. Acquiring land near the mines now will also speed things up once the elections are over,” said an official.

The total generation capacity of these power plants will be 30 GW. Two plants will be located in Chhattisgarh: one at its Mand-Raigarh Coalfield and another at the Korba Coalfield. In Odisha, two plants will be situated in the IB Valley area and the Sardega region.

The north will have two plants at Chotanagpur in the North Karanpura Coalfield, and another in the Rajmahal Coalfield in Jharkhand. According to the official, the government wants to replicate the model of the Shaktinagar’s coalfield region, which produces 10% of India’s coal and its Singrauli Super Thermal Power Station (SSTPS) generates 10% of the country’s electricity needs.

“Transporting electricity is inherently cheaper than transporting coal and then generating electricity. Therefore, the government is keen to start these power projects as soon as possible,” said the official.

As per the industry estimates, the average cost of coal production is around R2,000 per tonne, including all levies. However, transportation costs and losses cause the landed cost of coal at power plants to more than double to R4,300-4,600 per tonne.

This is the primary reason behind the government’s plan for these projects. Moreover, India needs to increase its power capacity to meet the growing demand and for economic growth.

As per the National Electricity Plan, India’s total installed capacity requirement by 2031-32 is projected to be 900,422 MW, encompassing both fossil and non-fossil-based capacities along with a significant allocation for Battery Energy Storage Systems.

 Additionally, the Central Electricity Authority has planned for an increase in coal-based capacity to 283,000 MW by FY 2032 from the current 214,000 MW.

Generation capacity of six power plants

The total generation capacity of these power plants will be 30 GW. Two plants will be located in Chhattisgarh: one at its Mand-Raigarh Coalfield and another at the Korba Coalfield.

In Odisha, two plants will be situated in the IB Valley area and the Sardega region. As per the industry estimates, the average cost of coal production is around R2,000 per tonne, including all levies.