By Dharmesh Prajapati
NEW DELHI, June 24 (Reuters) – India is increasing the use of domestic fuel to more than 50% at power plants designed to run on imported coal, as the world’s โsecond-largest thermal coal importer seeks to curb costly overseas purchases, government and industry โofficials said.
The South Asian nation is already using domestic coal for operating 5.7 gigawatts capacity so far this year of the total 18.7 GW capacity at imported coal-based power plants, they said.
Trials are underway to expand โthe switch to another 4.3 GW of capacity.
Import-based coal plants have previously relied โon coal from Indonesia, South Africa and Russia, among others. Imports from Indonesia โ and South Africa fell about 21% and 68%, respectively, in January through April from a โyear earlier, data from Indian coal trader iEnergy Natural Resources shows.
Higher power generation from renewable sources โis freeing up domestic fuel supplies, allowing more local coal to be diverted to coastal plants that were built to run on imports.
India has for years tried to reduce coal imports for power generation, but efforts โwere constrained because imported coal-based plants were designed for higher-grade fuel and struggled to process โlower-quality domestic supplies.
Operators have gradually modified units to handle greater volumes of local coal, which has higher ash โcontent, โ one government official said.
The companies are using a mix of imported and domestic supplies to optimise operations, with some facilities now using as much as 70% local coal, the sources said.
“The coal ministry has offered doorstep supply to imported-coal plants, which could take care of the quality โand quantity needed without โany issues,” another official โ said.
Imported coal-based plants have already booked 16 million metric tons of domestic coal for their needs, a third official said.
The officials could not โbe named as they are not authorised to speak to the media.
India’s โcoal-fired generation โ rose 10% in May from a year earlier, the highest growth since May 2024, as utilities increased generation to meet electricity demand, Grid-India data showed.