Indian tycoons: higher coal output to ease power crisis

Some of India's biggest tycoons asked the government to augment coal production to resolve electricity crunch.

Tata group Chairman Ratan Tata, Reliance Power Chairman Anil Ambani, and Adani Power Chairman Gautam Adani met with Singh on a long day of meetings in the capital between top power industry executives and senior government officials, reports Reuters.

"We pushed for all issues, mainly augmenting domestic coal production," Ashok Khurana, director general of the Association of Power Producers said after the group met B.K. Chaturvedi, the member of India's Planning Commission responsible for energy.

Stagnant domestic output by state-run Coal India, the world's largest coal miner, and lower-than-expected gas production coupled with the high cost of imports has thrown the business plans of generators into disarray.

In addition, the inability to pass along the full cost of fuel price increases makes many units unprofitable.

But as pressure builds on the government, India has raised its coal import target by over a third to about 114 million tonnes in the fiscal year ending in March, though further increases are unlikely because of a lack of rail capacity from key ports to end-users.

Coal accounts for more than half of India's power generation and will be required for about 85 percent of the target of adding 75,000 MW of capacity by 2017, a government draft report said in late 2011.

India has about 10 percent of the world's coal reserves but struggles to provide private players more access to coal blocks and swifter environmental clearances and land acquisition.

Coal Minister Sriprakash Jaiswal said on Wednesday that private sector power companies should do their part to address the shortage by lifting production at their own mines.

"We can't increase coal production quickly," he said after meeting the delegation, which was ferried between meetings in luxury cars and trailed by a about two-dozen journalists.

"We have asked them to resolve issues and increase output at captive mines."

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Tags: Indian tycoons, coal output, power crisis