India staring at major power crisis

Coal shortage stokes fears of potential blackouts

An energy crisis is looming over the country as coal supplies grow perilously low, adding to challenges for an economic recovery.

Supplies across the majority of coal-fired power plants have dwindled to just days worth of stock. Federal Power Minister R.K. Singh said that he was bracing for a “trying five to six months.’’

“I can’t say I am secure. With less than three days of stock, you can’t be secure,’’ Singh said.

The shortages have stoked fears of potential blackouts in parts of India, where 70 per cent of power is generated from coal. Experts say the crunch could upset renewed efforts to ramp up manufacturing.

Power cuts and shortages over the years have subsided in big cities, but are fairly common in some smaller towns.

Out of India’s 135 coal plants, 108 were facing critically low stocks, with 28 of them down to just one day’s worth of supply, according to power ministry data released on Wednesday, the most recently available.

On average, coal supplies at power plants had fallen to about four days worth of stock as of the weekend, the ministry said in a statement. That’s a sharp plunge from 13 days in August.

The government has asked state-run Coal India Ltd. to increase production. Coal prices in Indonesia, one of India’s suppliers, swelled to nearly $162 per ton this month from $86.68 in April, boosted by surging demand in China.