India’s changing goal posts over coal

Is India’s ambition to phase out coal-based power generation and switch to a natural gas-based energy production, viable?

The story so far: In April, Finance Minister Nirmala Sitharaman said India’s transition away from coal as a fuel for power would be hampered by the Russia-Ukraine war. “One calculation which I think we had in our mind was that the transition [away from coal] ... will be enabled by natural gas,” she said, adding that “lowering dependence on coal, and the speed with which we want to get out of it, will now be challenged.”

The threat of global warming looms over the planet, promising to bring about unprecedented natural calamities.

An effective way to keep the danger at bay is to cut the use of fossil fuels — coal, natural gas and oil. About 80% of the world’s energy requirements are met by these three fuels. They have likely brought on the climate crisis we now face, as they trigger the emission of carbon dioxide. However, the worst culprit of them all is coal, which emits nearly twice as much carbon dioxide as natural gas and about 60% more than oil, on a kilogram-to-kilogram comparison. Combusting coal also leaves behind partially-burnt carbon particles that feed pollution and trigger respiratory disorders. The consequence of these chemical reactions gains great significance because, the power sector in India accounts for 49% of total carbon dioxide emissions, compared with the global average of 41%.

As of February 2022, the installed capacity for coal-based power generation across the country was 2.04 lakh megawatt (MW). This accounts for about 51.5% of power from all sources. This compares with about 25,000 MW of capacity based on natural gas as fuel, or a mere 6.3% of all installed capacity. Renewable power accounted for 1.06 lakh MW or 27%.

Coal-based power stations are retired periodically which happens all the time. But is not fast enough nor are new additions being halted. And with good reason – coal is still inexpensive compared with other sources of energy.

For FY20, for example, India added 6,765 MW power capacity based on coal as fuel. But only 2,335 MW was retired. According to the IEA’s Coal Report 2021, India’s coal consumption will increase at an average annual rate of 3.9% to 1.18 billon tonnes in 2024.