Tangedco forced to import coal due to insufficient supply to the Center
In 2016, Coal India Limited (CIL) asked the government of Tamil Nadu to advise TANGEDCO to stop imports and use indigenous coal available with CIL
The handling of coal has been a delicate issue for the Tamil Nadu Generation and Distribution Corporation (Tangedco) even with its lower heat capacity. The coal allocated to TANGEDCO by the Union’s Ministry of Coal is not sufficient and it is forced to import coal, mainly from Indonesia. The thermal units in Mettur and North Chennai mix local and imported coal to generate electricity.
Tangedco’s total coal demand for a thermal capacity of 4320MW is 26 million tonnes of coal. “It requires 26 million tonnes of coal for the production at full capacity of the North Chennai, Mettur, Ennore and Tuticorin thermal units. Of this total, 20.445 million tonnes of coal are supplied by indigenous stocks and the balance 5.50 million tonnes is imported, ”said an official from Tangedco’s coal wing.
Tangedco began to import coal regularly from 2004-05. Imports started at 1 million tonnes, but as demand for electricity increased and more thermal units were put into service, the amount of imported coal also increased. In 2016, Coal India Limited (CIL) asked the government of Tamil Nadu to advise Tangedco to stop imports and use indigenous coal available with CIL.
But the following year, the Center asked distribution companies (Discoms) to import coal due to its scarcity as demand for coal increased across the country. Thus, Tangedco depended on imported coal to meet its demand for its thermal units.
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There are no less than 5,000 MW of thermal projects underway and unless more blocks of coal are allocated to Tamil Nadu, dependence on imported coal will increase. Tangedco had to spend more on local charcoal after the Center implemented a green cession due to which the additional spending increased by Rs 400 crore.
The latest Comptroller and Auditor General (CAG) report had criticized Tangedco for the inferior quality of the coal due to which more fly ash is struck in various thermal units.
“Tangedco suffered a production loss of 844 million units valued at 171.57 crore due to poor coal quality between 2014 and 2019. Tangedco has not adhered to guidelines to phase out coal. accumulation of ash on earth. A total of 62.15 million metric tonnes of ash had accumulated in three thermal units as of March 2019, ”the CAG said in its report. The report also accuses Tangedco of dumping ash on land, resulting in the contamination of groundwater, the Buckingham Canal and the Kosasthalaiyar River.
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The future is a little bright for Tangedco as the Center has allocated blocks of coal for new thermal projects to come. The Union Ministry of Coal has awarded the Chandrabila coal block to Odisha and Tangedco proposes to extract no less than 10 million tons each year from this coal block to supply fuel to the ETPS Expansion thermal unit of ‘a capacity of 660MW, Ennore SEZ in which two units of 660MW each is coming, and Udangudi Thermal Power Plant Stage 1, where two units of 660MW each are to appear.