The government encourages coal manufacturers to enhance the quality due to persistent grievances.

India is encouraging its coal producers to enhance fuel quality due to persistent grievances from the power sector, which occasionally gets shipments that fail to meet the agreed specifications.

The power ministry established a committee to tackle the issue and suggested actions, including assessing coal quality upon reaching customers, as per sources familiar with the situation. It suggested looking at various layers of the stockpile rather than only the surface, a technique referred to as auger sampling, to guarantee precision, the individuals stated, requesting anonymity as they are not permitted to talk to the press.

Coal is usually sampled from railway wagons at the loading points, and suppliers like Coal India Ltd. charge customers according to its quality. However, the material that arrives at the power stations can sometimes have a reduced heating value and may include mud or rocks that can harm plant machinery, the individuals mentioned.

This difference significantly impacts the energy sector, which is largely dependent on coal. To compensate for a reduced calorific value, clients tend to purchase more from miners, eventually transferring the expense to consumers. Increased volumes further strain an already pressured railway network, intensifying the competition for carriage space between freight and passengers during the summer months when demand peaks. Coal India did not answer emailed inquiries, and the power ministry didn’t promptly reply to a request for comment sent after office hours.

“This issue has been lingering for years. Coal India can no longer afford to brush aside these complaints,” said Rupesh Sankhe, senior vice president for research at Elara Capital India Pvt. Ltd. “India is fast turning from a sellers’ market into a buyers’ market for coal and the miners need to be more responsive to customers’ needs.”