With the substantial increase in coal production over the last 5 years, Western Coalfields Ltd.(WCL) has been able to provide more coal to nearby Power Consumers of Central & Western India at their doorstep. The availability of coal from a nearby sources has helped Power Consumers in getting coal at cheaper landed cost.
WCL is committed to meet the coal requirement of Power consumers located in Central & Western part of India. State Gencos of Maharashtra (MAHAGENCO) & Madhya Pradesh (MPPGCL) are the major consumers & largely dependent on WCL for their coal requirement. MAHAGENCO has the largest share of more than 50% of the dispatch followed by MP with 12% share. Apart from these, Gujarat State Electricity Board, NTPC, Adani Power (Maharashtra) Ltd are other Power consumers partially linked to WCL.
Coal production in WCL went down to a precarious level of 39 million tonnes during 2013-14 from an all-time high of 45 million tonnes during 2008-09. Unavailability of projects & non-availability of land were the major issues restricting the company to grow further. Power consumers of Central & Western India had no option, but to take coal from other Subsidiaries of Coal India, viz. SECL, MCL. Due to larger distance consumers had to pay more on Railway freight making landed cost of coal higher.
With an extensive exercise of revisiting all available projects & major liberalization in R&R Policy in a span of one year, WCL could get substantial chunk of land in possession which paved the way for opening of new viable projects. In just 5 years, WCL could open 20 new & expansion projects which substantially increased coal production year by year. From a level of 39.73 Million Tonnes in 2013-14, WCL achieved 53.18 Million Tonnes of Coal production in 2018-19 with a phenomenal growth of over 15% over the previous year. These new mines contributed 35.8 Million Tonnes during 2018-19. This growth in production was despite the closing down of old mines producing 22 Million Tonnes of coal in these five years. WCL would have gone down to a level of 17 Million Tonnes in 2018-19 if these 20 new mines would not have opened in the fastest time of 5 years
With the availability of more coal, WCL increased coal quantity to nearby Power Plants & also offered swapping of coal to Power Units from farther Subsidiaries like SECL, MCL, under coal rationalization policy of Ministry of Coal. This resulted in an increase in coal despatch to MAHAGENCO from a level of 17 Million Tonnes in 2013-14 to 28 Million Tonnes in 2018-19. Similarly, dispatch to MPPGCL increased from 4 Million Tonnes to 7 Million Tonnes in 2018-19. Gujarat State Genco has also been provided more coal by swapping 1.2 Million Tonnes from SECL. This trend of increase in coal supply is continuing during current fiscal & will grow further.
The availability of more coal at doorstep has manifold benefits to these Power Plants which includes huge saving on account of freight cost resulting in making power tariff cheaper for its consumers. Apart from this, the environmental damage due to transportation of coal from farther distance also gets minimized.
Savings to Mahagenco on account of Railway Freight over last 5 years due to more doorstep coal by WCL is approximately Rs. 1200 per tonne. In order to utilize this saving for more ease of doing business, Mahagenco & WCL decided to have coal transportation from mines to Power Plants through Pipe Conveyor. Accordingly, Mahagenco has invested substantial amount of its savings for installation of Pipe Conveyor from 5 mines of Nagpur Area of WCL to Koradi & Khaparkheda Thermal Power Stations and from 1 mine of Chandrapur Area to Chandrapur Super Thermal Power Station, which will further reduce the cost of transportation for MAHAGENCO by Rail/ Road & also minimise environmental pollution.
Against production target of 56 Million Tonnes for 2019-20, WCL is geared up to surpass its target again & to continue consequtive double digit growth. The Company has set an ambitious target of 75 Million Tonnes by 2023-24 by opening of bigger capacity projects. This growth in production will be even after loss of 14 million tonnes of production on account of closure of old mines in next 3 years.
WCL is providing around 80% of its total present requirement of coal to Mahagenco. Remaining 20% is still being catered by SECL, MCL & SCCL. With further increase in coal production, WCL will be able to swap the remaining quantity of coal to provide full quantity in next 2-3 years. Similarly, WCL is also forging ahead in providing full coal quantity to its Central & Western India Consumers in a span of 2-3 years. This will not only help in availability of cheaper coal at their doorstep but reduction in environmental pollution also.