Power Cuts, Coal Shortage, Heatwaves: The Vicious Cycle Ruining India’s Climate

How worse will power outages get in the coming months – and why?

The immediate result of this climate change is the current power crisis leading to hours-long outages in multiple states across India. However, that's not the only reason: Coal shortage, non-payment of dues, and a spike in demand all add to this power failure.

(Photo: Vibhushita Singh/The Quint)

“The dead hand of the past clutches us by way of living people who are too frightened to accept change.”

This is a quote from author Kim Stanley Robinson's The Ministry for the Future – a fiction almost coming true as an unusually early, unusually hot heatwave, hangs over India and its neighbours.

The immediate result of this climate change is the current power crisis leading to hours-long outages in multiple states across India. However, that's not the only reason: Logistical failures of coal supply, non-payment of dues, and a spike in demand all add to this power failure.

So why do we keep coming here? Are there any solutions to this? How worse will power outages get in the coming months? We explain.

Why Are Power Generation Plants Not Able to Match Demand?

Barely five months after India saw a power crisis in October 2021, we are again facing the same problem, with several states facing electricity outages, while there is an even higher demand in lieu of scorching heat waves that have made the oncoming summers something to be more anxious of.

Speaking on why power generation plants are not able to match the increased demand, Sudiep Shrivastava, environmental activist and lawyer, told The Quint:

"What has happened is that the government allowed power plants based on imported coal to run on domestic coal since last year's monsoon till now. So those power plants used a lot of domestic coal. And only now, that there is a power crisis, has the government taken corrective measures."

Sudiep Shrivastava, activist and lawyer

The "corrective measures" refer to a meeting chaired by Union Power Minister RK Singh this week, where the minister asked all the companies to operationalise their import-based power plants at full capacity to reduce pressure on domestic coal demand.

Now, Shrivastava added, "They have taken the decision that power plants should use imported coal, and whatever the higher charges, they will be allowed to transfer it on the consumers. The regulatory commission is going to accommodate these higher charges. So, Tata Mundra, Adani Mundra, and other projects based on imported coal are not going to suffer any loss.”

Notably, the government has decided that the entire cost of imported coal shall be allowed as pass-through until December 2022 without the $90 ceiling if the imported coal prices (currently hovering around $326 per tonne) remain above the pre-COVID level.

Another reason for the shortage, Shrivastava pointed out, is logistics – a lack of wagons available with the railways to carry coal from pitheads to power plants.

What Role Have Heatwaves Played in the Current Crisis?

While coal shortages after the monsoon season is normal, what has changed since last year are the increasing heatwaves.

In the national capital for example, a 72-year record was broken this April, with temperatures hitting 42.6 degrees Celsius on 11 April.

Sanjay Vashisht, director of Climate Action Network South Asia, told The Quint, "High temperature has a big role to play in power outages. Churro in Rajasthan for example is touching 50 degrees, which is not something we’ve seen during this time period earlier."

"Due to higher temperatures, there is a spike in power demand, which is obvious. And the coal requirement has also increased because of the higher consumption," Vashisht added.

"It’s a vicious circle – you’re burning coal to deal with the heat, but at the same time you’re contributing to this heat because of the greenhouse gases that go into the atmosphere."

Sanjay Vashisht, Director, Climate Action Network South Asia

However, the circle gets more vicious.

Vashisht points out that the biggest problem with coal power plants, that happened in 2015 when there was a drought, and is bound to happen again – is shortage of water during summers for producing energy.

So even if we have enough coal from the mines to the power plants, low water levels will lead to less energy production.

"We do not have time. We need to double down on our efforts for renewables. We have to run faster than climate change is running. Even if we overcome heatwaves, be ready for more cyclones and floods, which will further impact the coal production."

Sanjay Vashisht, Director, Climate Action Network South Asia

Why Is Coal No Longer a Dependable Source of Energy?

"Two hours of an outage in a big city is leading to hue and cry, but the bigger issue is being ignored," Shrivastava said.

The government should, Shrivastava added, "First, avoid coal. If not possible, then minimise. Even if that is not possible, then sure burn coal. But don’t get coal by cutting forests," pointing out to the recent expansion cleared by the Chhattisgarh government in Hasdeo Aranya forests.

"The government has created such a mess and if they plug the two-hour gap today, there will be a four-hour outage tomorrow. We need to plan for long-term solutions," Srivastava added.

Meanwhile, explaining how India's commitment to renewables, especially solar, is a facade, Srivastava noted:

"The Indian government’s commitment with the International Solar Alliance is that by 2030, we will require 8 lakh MW, out of which 30 percent will be made from renewable sources. Cleverly, the government has got a sanction that more than 5 lakh MW will come from conventional sources, for which we are heading forward with full steam. The fact of the matter is that the requirement was projected on the higher side. Even now, they are auctioning more and more coal mines, so their intent is visible."

Sudeip Srivastava, activist and lawyer

Pointing out another important statistic, he adds that the "total install (generation) capacity for coal is 56 percent – but the generated electricity (consumption from coal power) is 76 percent. So, the install capacity is less, but the consumption from generation is higher, which means that despite having capacity for generation from renewables, it is lying underused.

"If the use of the current installed capacity for solar and wind right now is brought up to the level of coal, there won’t be any crisis. Energy is one thing that can’t be stored and its shortage can happen anytime," Shrivastava added.

Is It a Power Crisis or a Payment Crisis?

From the coal mining companies to power generation plants to power distributing companies, everyone is reeling under non-payment of dues.

State-run Coal India Ltd (CIL), the world’s top producer of the fuel, accounts for nearly 80 percent of India’s domestically mined coal. Now, CIL is owed about Rs 12,300 crore by power generation companies and yet it continues to sell coal to its customers.

Power generators, in turn, are owed over Rs 1.1 lakh crore by power distribution companies (discoms) and yet they continue to sell electricity to them, MoneyControl reported.

Similarly, discoms have accumulated losses of over Rs 5 lakh crore and regulatory assets, which represent costs that are deferred for recovery through future tariff revisions, worth Rs 1.25 lakh crore. Yet, they continue to supply electricity to consumers, with occasional power cuts.

Girishkumar Kadam, senior vice president and co-group head corporate rating, at ICRA, was quoted as saying:

"There has been a moderation in coal supply towards certain gencos because of the overdues or delays in the payments. As a result, discoms/state governments will either have to absorb the cost burden with increased imported coal-based generation and pass on the same through tariff hikes or they could be constrained to offtake power, resulting in load shedding, which has been visible in a few states recently."

Load shedding is the deliberate shut down of electric power in certain areas of a power-distribution system, mostly to prevent the tripping of the entire system when spiked demand strains the system's capacity.

Meanwhile, according to the Central Electricity Authority (CEA), 86 of the 150 domestic coal-fuelled units had critically low average stock, having less than 25 percent of their normal requirements.

The key reasons listed were low supply from Coal India and its subsidiaries, pointing to moderation by CIL on the basis of who makes the payment first.

Will There Be More Power Cuts?

Currently, Uttar Pradesh, Punjab, Maharashtra, Haryana, Tamil Nadu, and Andhra Pradesh are facing some of the longest power cuts in the country.

Of the 12 states facing a shortage, Andhra Pradesh's situation is the direst. The state has reduced its industrial supply by 50 percent and imposed massive power cuts for domestic users, CNBC reported.

Meanwhile, Gujarat has asked industries to remain shut once a week to make up for its 500 MW shortage. Maharashtra has been facing a shortage of over 3,000 MW on average for the last 2-3 weeks and blames some producers of cutting output.

Vashisht told The Quint:

"We will certainly have more power outages. Coal cannot meet the growing demand of energy. We will also not be able to provide energy to our production areas, which will further impact output. The coming months will also lead to more heatwave-related diseases. We have always thought of coal as a reliable source of energy, but even coal is going to ditch us because of shortage of water and heat will continue to grow."

Sanjay Vashisht, Director, Climate Action Network South Asia

Shining light on possible long-term solutions, Vashisht stated that so far "centralised energy is the major model in india – basically coal power plants provide electricity to grid – then distribution companies take over and distribute it."

However, to deal with the crisis, he adds, "India needs a decentralised system – for example, establishing a solar power plant within a Resident Welfare Association. Or we may establish a wind turbine on coastal areas, which will charge batteries, so that the deficit of electricity can be matched."

He adds, "I would recommend that every house has some solar power plant. It’s like having inverters, but instead of them being charged by electricity coming from the grid, they will be charged with solar power. This can play a massive role in bridging the gap."

• Summers are yet to peak and unless the payment issues are resolved, domestic coal production and energy generation will continue to suffer.

• Further, the so-called "coal shortage" and the electricity cuts are temporary, but the heatwaves are not. India needs to phase out coal while bringing in renewables that can match a similar demand as coal.

• And finally, if India continues to aim for development, while forgetting 'sustainable' as its prefix, the heatwaves shall only get worse.