Tangedco’s coal import bill to go up by 4 times

In a controversial move, Tangedco floated an e-tender cum e-reverse auction bid to procure 4.8 lakh tonnes of imported steam coal (heat density of 5,000 kcal/kg) at a time when the international rates are hovering at a record price following Ukraine war.

Sources said the GCV 5,000 kcal/kg coal now costs about $200 in the international market, a four-fold increase compared to the $48/tonne that the utility had paid previously.

A senior official said Tangedco was forced to opt for import due to the Union Power Ministry’s directive to procure 10 per cent of coal demand through import. The official added that the imported coal is likely to cost $150 to $160 per MT. “We are forced to import owing to short supply from the mines. As against the requirement of 60,000 tonnes/day, we are receiving only 50,000 tonnes. But our power demand has already crossed 16,300 MW, and would increase by another 1,000 MW in the coming days,” the official said.

The official said that the coal import was meant for only April and May, adding that the cost of generation would be Rs 8-9/unit as against the power procured from exchanges at Rs 15-16/ unit.

S Neelakantapillai, an activist and retired Tangedco engineer, questioned the move to import coal when prices have gone up so steeply. “If the supply of coal was less, why did it not float the bids earlier to meet the summer demand,” he asked.