India Orders Captive Coal Plants to Maximise Power Output Amid Rising Demand

The Indian government has directed more than 100 captive coal-fired power plants to operate at maximum capacity for three months from October 1 to December 31, as authorities prepare for a possible increase in electricity demand. The directive covers 112 captive power plants with an installed capacity of at least 50 MW. The order has been issued under emergency provisions of the Electricity Act and is aimed at ensuring adequate electricity availability during a period when demand is expected to remain elevated.

The plants are operated by major industrial companies, including Vedanta, Tata Steel, Hindalco, JSW Steel, UltraTech Cement, Reliance Industries, Indian Oil, Bharat Aluminium and Hindustan Zinc. Much of the electricity generated by these facilities is used to meet the power requirements of industrial operations such as aluminium smelters, steel plants, cement factories and oil refineries.

Under the government directive, the plants have also been asked to sell surplus electricity through power exchanges. This could allow additional generation from captive facilities to be supplied to the wider electricity market when it is not required for their own industrial operations.

The decision comes as India faces concerns over coal availability at power plants. Nearly 40 per cent of the country’s coal-fired power plants reportedly have critically low fuel stocks, adding pressure on the electricity supply system. Officials are also preparing for higher power consumption amid unusually warm weather. The report links the elevated temperatures partly to the El Niño climate phenomenon, which has contributed to increased demand for cooling and electricity in several areas.

The government has separately extended an emergency directive requiring Tata Power’s imported-coal-based Mundra power plant in Gujarat to operate at full capacity. The order has now been extended until December 31. By increasing generation from captive and imported-coal-based plants, authorities are seeking to add capacity to the grid while ensuring that industrial consumers continue to receive adequate power.