DNA Money Edit: Ensuring quality power a challenge for govt

Rising coal prices, coupled with jump in summer time demand for electricity, has strained the quality of power available in several parts of the country. June has seen the national peak demand touching 170 GW on June 23 about 13% more than the peak demand of 150 GW reported in June 2017. On the same day, the Northern Region registered highest ever peak demand of 62 GW. Generally, inadequate hydro power generation and slow pick-up in wind power lead to increase in demand from the distribution companies as well as the large consumers.

All these are happening at a time when for the last few months, imported coal prices have seen a sharp hike, touching $100 a tonne, and sector experts believe international coal prices would stay at higher levels in the coming days. This will keep power prices at an elevated level. The average Market Clearing Price discovered in the Day Ahead-Market at India Energy Exchange on June 23 was Rs 3.73 per unit, 44% increase over Rs 2.59 per unit in same month last year.

To tide over this crisis of lower availability of coal and higher demand for power, the government has asked Coal India to step up output. That's easier said than done as coal mining gets severely impacted during the rains.