1 Mobilization of Coal Supply Presented at the IRADe Energy Conclave 27 July 2006 T.L. Sankar (Advisor Energy Area) Centre for Infrastructure Management ADMINISTRATIVE STAFF COLLEGE OF INDIA Bella Vista: Hyderabad

2 IEP Estimate of Energy Demand Assumed GDP Growth rate = 8% per year. Elasticity reducing slightly over time in case of both TPES and Electricity SL.No. YearTPES (Mtoe)Energy Required Generation (Bill kWh) TPES - Total Primary Commercial Energy Supply. Mtoe - Million tonne oil equivalent. B.kWh - Billion units of electricity.

3 Sources of Power Generation SL. No. YearTotal Elect. (B.kWh) Nuclear B.kWh Hydro B.kWh Wind B.kWh Coal MMT NG MMT Oil MMT Growth rate (% per year)

4 IEP Estimates of demand Ranges under scenarios FuelRanges of Need Likely domestic production Ranges of Imports Import (%) Oil(mt) Natural gas +CBM(mtoe) Coal (mtoe) TCPES(mtoe)

5 SL. No. YearCoal Demand for Power Generation MMT Coal Demand for non-power MMT Total Coal Demand Growth rate % per year Coal Demand estimate by IEP (Plan-wise scenario)

6 Coal Production – Achieved/Required Rates of Growth Coal Production (Total) in = = Achieved Growth rate in past 24 years= 5.3% Required Growth Rate as per IEP = 5.8% Let us assume that growth rate increases by 1% over the past trend and is 6.3% Production in could be = 2293 MT.

7 Measures proposed in Expert Committee on Coal Reforms 1.Delineate the coal reserves situation in India on the basis of international standards UNFC standards. 2.Allow private industry to enter into exploration- cum-mining lease on the lines of NCLP in oil industry. 3.Liberalize captive mining procedures and release all areas with CIL which are not covered in their production plans up to 12 th plan. 4.Create a Coal Regulatory Authority.

8 Measures proposed in Expert Committee on Coal Reforms (Contd.) 5.Dual pricing in coal sector. For industries which ensure large quantities of coal and need special infrastructure arrangements and whose end- products prices are regulated, a cost plus basis pricing to be determined by the Coal Regulator: The price of coal to other industries to be market determined through at auction. 6. FSTA arrangements to be introduced.

9 7. Encourage coal exports and imports simultaneously each year. 8.Preference in future power plant locations – for pit head and port locations. 9.Undertake immediately measures to introduce and use extensively clean coal technology. 10.Restructuring the coal industry and legal structures governing coal industry. Measures proposed in Expert Committee on Coal Reforms (Contd.)