1. 1 Mobilization of Coal Supply Presented at the IRADe Energy Conclave 27 July 2006 T.L. Sankar (Advisor Energy Area) Centre for Infrastructure Management ADMINISTRATIVE STAFF COLLEGE OF INDIA Bella Vista: Hyderabad-500 082

2. 2 IEP Estimate of Energy Demand Assumed GDP Growth rate = 8% per year. Elasticity reducing slightly over time in case of both TPES and Electricity SL.No. YearTPES (Mtoe)Energy Required Generation (Bill kWh) 12006-07394761 22011.125371097 32016-177181524 42021-229612118 52026-2712482866 62031-3216203880 TPES - Total Primary Commercial Energy Supply. Mtoe - Million tonne oil equivalent. B.kWh - Billion units of electricity.

3. 3 Sources of Power Generation SL. No. YearTotal Elect. (B.kWh) Nuclear B.kWh Hydro B.kWh Wind B.kWh Coal MMT NG MMT Oil MMT 12006-07761261005375186 22011-121087591798493258 32016-17152411022612656419 42021-222118206283158145512 52026-2728863014001911338914 62031-32388044150024147813417 7 Growth rate 2006-2031-32 (% per year) 6.712.06.66.55.68.44.2

4. 4 IEP Estimates of demand Ranges under scenarios FuelRanges of Need Likely domestic production Ranges of Imports Import (%) Oil(mt)406-49335371-45891-93 Natural gas +CBM(mtoe) 114-2242000-240-11 Coal (mtoe)573-108256013-5222-48 TCPES(mtoe)1376-1692-384-100428-59

5. 5 SL. No. YearCoal Demand for Power Generation MMT Coal Demand for non-power MMT Total Coal Demand 12006-07375123498 22011-12493164657 32016-17656221877 42021-228142991133 52026-2711334081541 62031-3214785822060 7 Growth rate % per year 2006- 2031 5.66.45.8 Coal Demand estimate by IEP (Plan-wise scenario)

6. 6 Coal Production – Achieved/Required Rates of Growth Coal Production (Total) in1980-81 = 114.01 2004-05 = 382.65 Achieved Growth rate in past 24 years= 5.3% Required Growth Rate as per IEP = 5.8% Let us assume that growth rate increases by 1% over the past trend and is 6.3% Production in 2031-32 could be = 2293 MT.

7. 7 Measures proposed in Expert Committee on Coal Reforms 1.Delineate the coal reserves situation in India on the basis of international standards UNFC standards. 2.Allow private industry to enter into exploration- cum-mining lease on the lines of NCLP in oil industry. 3.Liberalize captive mining procedures and release all areas with CIL which are not covered in their production plans up to 12 th plan. 4.Create a Coal Regulatory Authority.

8. 8 Measures proposed in Expert Committee on Coal Reforms (Contd.) 5.Dual pricing in coal sector. For industries which ensure large quantities of coal and need special infrastructure arrangements and whose end- products prices are regulated, a cost plus basis pricing to be determined by the Coal Regulator: The price of coal to other industries to be market determined through at auction. 6. FSTA arrangements to be introduced.

9. 9 7. Encourage coal exports and imports simultaneously each year. 8.Preference in future power plant locations – for pit head and port locations. 9.Undertake immediately measures to introduce and use extensively clean coal technology. 10.Restructuring the coal industry and legal structures governing coal industry. Measures proposed in Expert Committee on Coal Reforms (Contd.)