Electricity prices in West Bengal are among the highest in India. An important reason behind this has been the unavailability of the required amount of coal for power production at affordable prices.
In an exclusive interview with BE’s Kishore Kumar Biswas, Dr. P. B. Salim, IAS, Chairman and Managing Director, West Bengal Power Development Corporation Limited, speaks about the state’s power sector having increased access to its own sources of coal in the near future.
Q. West Bengal Power Development Corporation Limited (WBPDCL) suffers from low plant load factor (PLF) which was close to 55% in FY 2018-19. It has come down close to 53% in April-September 2019. What is your vision to uplift PLF to 80% or more?
A. It is true that our plant load factor (a measure of the output of a power plant compared to the maximum output it can produce) is not very high. The main reason for this is the problem of coal availability. We have five plants with total production capacity of 4770 MW per day. To produce the full amount, we need 24 rakes of coal (one rake contains 3500MT of coal). We have Fuel Supply Agreement (FSA) with Coal India Limited (CIL) of only 10.5 rakes of coal per day. We are presently dependent on other sources like purchase from the market, coal auctions and on imports. Through such alternative arrangements, we get access to another five or six rakes per day. We still have a persistent shortage of about nine rakes of coal per day. Therefore, we are emphasising on attaining our own sources of coal. This will lower our power production cost. That in turn will improve our PLF to a great extent.
Q. Please elaborate about the other sources of coal and tell us about the new mines.
A. In Jharkhand, we have got a coal mine at Pachhwara in Pakur district. In that mine, about three million tons of coal is reserved. The mining process has started. We will get three rakes per day from that mine. Another two or three rakes per day will be available from our new mines in Bajora north and Gangaramchak.
I would like point out that we have recently got India’s biggest coal mine at Dewanganj Harisinga in Mohammad Bazar block of the Birbhum district in our state. In that mine, about 2.1 billion MT of coal is reserved. But mining will take time as the region is now inhabited. There are about 28,000 persons residing in that place. Therefore we will have to thoroughly talk to them about their rehabilitation and on other matters before we can start mining. We hope that when the mine will be in operation, about 15 rakes of coal per day will be available from it. In that situation, there will be no shortage of coal and the supply of coal may be in surplus.
Q. What will you do with surplus coal?
A. We plan to generate an additional 2500 MW of power in a few years. When that happens, more coal will be needed and a huge surplus of coal may not be there. Moreover, we require more coal for the Sagardighi and Bakreshwar power plants. These two plants require an additional nine rakes of coal.
In short, we hope that we will be self-sufficient in coal availability in near future. Our peak demand for power has been about 6500 MW. During the Durga Pujas, our peak demand for coal has been about 7300 MW. When all the new mines will be in operation, we will be able to produce sufficient power for the state.
Q. What is your vision about the production of power in a cost effective way and at the same time, with a view of generating more employment?
A. Whenever we have our own sources of coal, the cost of coal will fall. Presently, we have to purchase coal from outside sources which cost around Rs. 4000 to Rs. 4500 per MT. But when we have access to our own sources, coal prices will be around `2500 per MW and we will have a 25% cost advantage from coal purchase only. Secondly, to run 20 units we have 27,000 employees. According to our estimates, we have been producing 4700 MW of power with this employee strength. We are assuming that we will require no additional human resources to generate the additional 2500 MW to 3000 MW of power. In that case, we will be able to generate about 35% additional power with almost the same level of employees. As a result, our cost of power production will also get lowered.
Q. The state has to increase the share of renewable energy in its power mix. In that case, you have to accommodate for more production of thermal power in the night time. How are you prepared to do that?
A. That has been a very important factor for many producers. But as of now, our share of renewable energy is not high as it is less than 5%. We do not have the problem that you just mentioned. When the share of renewable energy gets significantly increased, we will have to think about the issue that you mentioned.