The demand for coal will continue to rise in India, with predictions estimating a range of 1.3-1.5 billion tonnes by 2030, according to the2021-22 Economic Survey. This is a substantial increase from the current demand, which was registered at 955.26 million tonnes in the 2019-20 fiscal year. These predictions come in light of ambitious renewable energy goals and reflect the significant role coal continues to play in the Indian economy.
The Rise in Coal Demand
The primary driver behind the increasing demand for coal is its application in iron and steel production. Presently, there aren’t many technologies capable of replacing coal’s utility. The anticipated expansion of India’s economy over the next few years—expected at an average GDP growth rate of 7.4% annually—is projected to be fueled partly by coal.
Moreover, the country’s move towards domestic coal mining, both through Coal India and the auctioning of coal blocks to private companies, suggests that coal usage in India will continue to rise even as it plateaus globally. The central government has initiated major reforms in the coal sector by opening up coal mining to private entities. This move is expected to result in competitive and efficient production, attract investments and top-tier technology, and generate new employment opportunities.
Implictions of Growing Coal Demand
However, this increased reliance on coal comes with several concerns. The most immediate concern is local pollution. New emission norms for coal-powered thermal power plants have been instituted by the government, but implementation has been inadequate.
Coal and lignite-based power plants emit roughly 1.3 billion tonnes of carbon dioxide equivalent per year, contributing to a third of India’s total greenhouse gas emissions. The government has proposed afforestation, or planting trees to absorb CO2, as a potential solution. However, given India’s high population density, this may not be a viable or effective solution.
Coal Companies’ Efforts Towards Renewable Energy
Companies in the coal industry have attempted to mitigate their environmental impact by transitioning towards renewable energy sources. As of March 31, 2021, Public Sector Units (PSUs) had ensured a renewable capacity of 1,496 megawatts and planned to install an additional 5,560 megawatts in the next five years.
However, these efforts fall short of the commitments made by the Prime Minister at the recent Glasgow conference, which included a goal of 500 gigawatts installed capacity through non-fossil fuels and meeting 50% of the country’s energy requirements from renewable sources by 2030.
About Coal
One of the most abundant fossil fuels, coal is widely used as a domestic fuel, in industries including iron and steel, steam engines, and for generating electricity—referred to as thermal power. Formed millions of years ago from giant ferns and swamps that got buried under earth layers, coal is often referred to as ‘Buried Sunshine’. Top coal producers include China, the US, Australia, Indonesia, and India, with major Indian coal producing regions including Raniganj, Jharia, Dhanbad, and Bokaro in Jharkhand. It is classified into four ranks: anthracite, bituminous, subbituminous, and lignite, depending on its carbon content and heat energy production potential.
Way Forward
To mitigate the environmental implications of coal usage, it’s crucial for India to invest in clean coal technologies throughout the supply chain. Power utilities controlled by the government should lead by example, investing heavily in the deployment of advanced clean coal technologies. It’s also recommended that India be cautious in adding new coal capacity beyond 2030, to avoid committing resources that could be better utilized elsewhere.
