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LYSIS OF COAL SHORTAGE IN INDIA
DURING THE COVID-19 PANDEMIC
SUPRATIK CHAKRABORTI, GOPA MAITY
CORPORATE SERVICES
Abstract
In the aftermath of the second wave of the Covid pandemic in India, the nation was faced with an acute shortage
of coal, with several thermal power plants reporting coal stocks of less than 9 days, against normative coal
stock of at least 15 days. Such reports received significant attention in the media and reports identified several
possible reasons that exacerbated the coal crisis. This article aims to critically examine the reasons behind such
an acute crisis, including the sudden increase in demand, restrictions on import of coal, despatches of coal from
Coal India Limited and other captive mines, and also in light of structural problems like overdues to generating
companies. Our findings indicate that reduced imports of coal, and the sudden uptick in demand are the major
reasons that led to rapid depletion of coal stock, while there is no evidence to support that delay in release of
payment to power generating companies by power distribution companies played a part in exacerbating the
condition. The data also shows that as a result of shock at the onset of the second wave of the pandemic, coal
despatches started lagging levels of coal stock, which ultimately led to the acute crisis gripping the nation in the
month of October 2021.
Index Terms: Coal, Covid pandemic, Electricity Consumption, Overdues, Power Demand
INTRODUCTION and demand. This was evidenced by an uptick in several
high frequency indicators including electricity generation
INDIA saw the second wave of COVID-19 in the months and coal output from Coal India Limited.
of April-June 2021. During those months, both society
and businesses were affected, with the nation facing As a result of elevated activity following the vaccine
acute shortage of healthcare facilities including hospital rollout, in the beginning of the last quarter of the
beds, oxygen cylinders and other medical supplies. calendar year 2021, the nation was faced with the
Businesses were faced with an unprecedented supply problem of acute shortage of coal. Approaching the
shock, as production and supply chains around the globe festive season, several coal-fired generating stations
were affected by restrictions to free movement of labour reported being down to critical level of coal stock, with
and goods. Subsequently, India saw a large number of less than 3-4 days of coal stock. Most notably, Delhi had
vaccinations, and by August 2021, experts from the World reported concerns of potential blackouts, and Rajasthan,
Health Organization stated that India was approaching Punjab and Bihar saw instances of load shedding. The
the stage of an endemic, where the country starts to coal shortage scenario attracted great attention from
learn to live with the virus. Industrial activity picked up the media, while ministry officials dismissed concerns
subsequently, leading to increased levels of consumption of coal crisis in India.
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DURING THE COVID-19 PANDEMIC
SUPRATIK CHAKRABORTI, GOPA MAITY
CORPORATE SERVICES
Abstract
In the aftermath of the second wave of the Covid pandemic in India, the nation was faced with an acute shortage
of coal, with several thermal power plants reporting coal stocks of less than 9 days, against normative coal
stock of at least 15 days. Such reports received significant attention in the media and reports identified several
possible reasons that exacerbated the coal crisis. This article aims to critically examine the reasons behind such
an acute crisis, including the sudden increase in demand, restrictions on import of coal, despatches of coal from
Coal India Limited and other captive mines, and also in light of structural problems like overdues to generating
companies. Our findings indicate that reduced imports of coal, and the sudden uptick in demand are the major
reasons that led to rapid depletion of coal stock, while there is no evidence to support that delay in release of
payment to power generating companies by power distribution companies played a part in exacerbating the
condition. The data also shows that as a result of shock at the onset of the second wave of the pandemic, coal
despatches started lagging levels of coal stock, which ultimately led to the acute crisis gripping the nation in the
month of October 2021.
Index Terms: Coal, Covid pandemic, Electricity Consumption, Overdues, Power Demand
INTRODUCTION and demand. This was evidenced by an uptick in several
high frequency indicators including electricity generation
INDIA saw the second wave of COVID-19 in the months and coal output from Coal India Limited.
of April-June 2021. During those months, both society
and businesses were affected, with the nation facing As a result of elevated activity following the vaccine
acute shortage of healthcare facilities including hospital rollout, in the beginning of the last quarter of the
beds, oxygen cylinders and other medical supplies. calendar year 2021, the nation was faced with the
Businesses were faced with an unprecedented supply problem of acute shortage of coal. Approaching the
shock, as production and supply chains around the globe festive season, several coal-fired generating stations
were affected by restrictions to free movement of labour reported being down to critical level of coal stock, with
and goods. Subsequently, India saw a large number of less than 3-4 days of coal stock. Most notably, Delhi had
vaccinations, and by August 2021, experts from the World reported concerns of potential blackouts, and Rajasthan,
Health Organization stated that India was approaching Punjab and Bihar saw instances of load shedding. The
the stage of an endemic, where the country starts to coal shortage scenario attracted great attention from
learn to live with the virus. Industrial activity picked up the media, while ministry officials dismissed concerns
subsequently, leading to increased levels of consumption of coal crisis in India.
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