NEW DELHI: India is steadily increasing domestic coal use in power plants originally designed to operate on imported fuel, as the country seeks to lower import costs and strengthen energy security.
Government and industry officials said domestic coal is already being used in power stations with a combined capacity of 5.7 gigawatts (GW) this year, out of the total 18.7 GW installed capacity of import based thermal plants. Trials are also underway to extend the shift to an additional 4.3 GW of generation capacity.
The move comes as higher electricity production from renewable energy sources has eased pressure on local coal supplies, enabling authorities to divert more domestically mined fuel to coastal power stations that traditionally depended on imported coal.
India has long aimed to reduce its dependence on overseas coal purchases, but progress was limited because many import-based plants were built to run on higher-grade fuel sourced from countries such as Indonesia, South Africa and Russia. Plant operators have gradually upgraded systems to accommodate larger quantities of domestic coal, which contains higher ash content.
According to officials, several power stations are now operating with a blend of imported and local fuel, with some units sourcing up to 70 percent of their requirements from domestic mines.
To support the transition, the Coal Ministry has offered direct supply arrangements to these plants, helping ensure consistent fuel availability and quality. Officials said import-based power producers have already booked around 16 million tonnes of domestic coal.
The shift is reflected in trade data. Imports from Indonesia and South Africa declined sharply during the first four months of the year, while India’s thermal coal imports dropped to a four year low of 65 million tonnes between January and May, according to commodities consultancy BigMint.
Meanwhile, coal fired electricity generation increased 10 percent year-on-year in May, marking the strongest growth in a year as utilities stepped up output to meet rising power demand.
The officials spoke on condition of anonymity because they were not authorised to discuss the matter publicly.