Power producers are in for tough times this year, with plant load factors of several producers falling by as much as 20% due to acute coal shortage. This might spill over into the new financial year too, since there just isn’t enough coal available to feed India’s steel and power production facilities.
Business Standard said that even as India’s new power producers were coming to terms with coal shortages in India, the floods and subsequent cyclone in Australia have come has a body-blow to cement, power and steel producers. Imported coal prices are up 44% YoY, impacting profitability even further.
According to analyst estimates, Indian coal availability is expected to rise at a compound annual growth rate of only 4.2% over the financial year 2010-14, which is insufficient to meet the power capacity growth of 10.4%. (sourced: moneycontrol)