India could build new coal-fired power plants due to low cost despite climate change By Reuters

© Reuters. FILE PHOTO: Smokestacks of a coal-fired power plant pictured in New Delhi


By Sudarshan Varadhan

CHENNAI (Reuters) – India could build new coal-fired power plants because they generate the cheapest energy, according to a draft electricity policy document seen by Reuters, despite growing calls from environmentalists to dissuade the use of electricity. coal.

Coal’s contribution to power generation in India declined for the second year in a row in 2020, marking a departure from decades of coal-fired power growth. Yet fuel accounts for nearly three quarters of India’s annual electricity production.

Environmental activists have long rallied against India by adding new capacity for charcoal production. Solar and wind energy prices are falling to record highs, which would help the world’s third largest emitter of greenhouse gases reduce emissions.

US Presidential Special Envoy for Climate John Kerry said this month India is “doing climate work, pushing the curve” as he begins talks with government leaders aimed at reducing carbon emissions more quickly to slow global warming.

But a February 28-page draft of the 2021 National Electricity Policy (NEP) – which has not been made public – showed India could add new coal-fired capacity, while recommending standards. more stringent technologies to reduce pollution.

“While India is committed to increasing its capacity through non-fossil production sources, coal-based production capacity may still be needed to be added in the country as it continues to be the source of cheapest production “, we read in the NEP draft.

All future coal-fired power plants should only deploy so-called “ultra super critical” less polluting “or other more efficient technologies,” he added.

State-owned NTPC Ltd, India’s largest electricity producer, said in September that it would not acquire land for new coal-fired projects. Private companies and many state-run companies across the country have not invested in new coal-fired power plants in years, saying they are not economically viable.

A source with direct knowledge said a government group made up of various energy sector experts and officials will discuss the project and may make changes before seeking cabinet approval.

India’s Energy Ministry did not immediately respond to a request for comment on Sunday.

The draft document also proposed the trading of renewable energy in the markets of the day to come, the creation of separate tariffs for electric vehicle charging stations and the privatization of electricity distribution companies.


NEP 2021 is India’s first attempt to revise its electricity policy enacted in 2005, when the country produced negligible renewable energy.

Experts say the gradual introduction of renewable energy sources and the phasing out of conventional sources such as coal could quickly lead to instability in the electricity grid, which could lead to blackouts.

While suggesting flexible use of coal and natural gas electricity to ensure grid stability in the years to come, the draft policy lists the promotion of clean energy as its main objective.

The draft policy suggested accelerating the adoption of “cost-effective” pumped hydraulic storage to support the electricity grid, adding that only 4.8 gigawatts (GW) of a potential 96.5 GW of pumped storage capacity have been developed so far.

The policy also recommends compensating natural gas-fired power plants for reduced efficiency operation to ensure grid stability and for higher wear and tear due to fluctuations in production.

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