India's coal consumption is projected to reach 1.5 billion tonnes by 2030, driven by robust power demand, said industry expert during the China Coal Import International Summit held on March 8.

 

 

Abhi Bannerjee, assistant general manager of BigMint, noted that India's energy demands are catered chiefly from domestic coal production, while imported coal was used to bridge supply gaps and meet high-quality coal demand.

 

India's power sector was the primary consumer of thermal coal. In 2023, thermal coal consumption of domestic thermal and captive power plants reached 770 million and 140 million tonnes, respectively, accounting for nearly 90% of the country's total thermal coal consumption.

 

Bannerjee emphasized that key factors influencing thermal coal demand included increased power demand, GDP growth, accelerated industrialization, dependence on coal, and the progress of infrastructure projects.

 

Except for a notable drop in 2021, India's power consumption per capital had been on the rise over the past decade. In 2023, the volume reached 1,357 KWh, hitting a historical high.

 

Bannerjee predicted that thermal coal consumption will continue to grow along with rising power demand. By 2030, the total thermal coal demand is expected to reach 1.42 billion tonnes, with 95 million tonnes being of imported coal.

 

Increased domestic coal output would help reduce imports, but ensuring coal quality remains crucial for non-power sectors in India. Coal imports were encouraged when logistical constraints impeded domestic supply.

 

Coking coal, used for steelmaking, was mainly consumed by the steel sector in India. However, India's coking coal output was lower than thermal coal due to insufficient reserves, resulting in heavy dependence on imports.

 

The steel sector's coking coal demand came in at 59.40 million tonnes in 2023, with 54.10 million tonnes from imports. Australia is the major supplier of coking coal, BigMint data showed.

 

India's coking coal demand is anticipated to grow further, supporting the development of steel infrastructure projects. Total coking coal demand is likely to reach 93.50 million tonnes by 2030, said Bannerjee.

 

The Indian government targeted producing 140 million tonnes of coking coal by 2030. The reliance on imported coking coal would depend on the construction of new washing plants and the potential supply of washed coal.

 

India, however, still needs to address challenges in the coal industry including environmental issues, logistics bottlenecks, pricing concerns, coal mining scales, energy competition and seasonal factors.

 

Nevertheless, coal may remain the primary energy source in India in the long run, and the government would prioritize ensuring energy security, according to Bannerjee.

 

India aims to produce 1.50 billion tonnes of coal by 2030. India's thermal coal imports are expected to decline amid elevated domestic output, while the reliance on coking coal imports may persist.

 

By 2030, India's non-fossil fuel power generation capacity may reach 500 GW, as the government continues to promote renewable energy power generation. With the advancement of energy transition plans, the share of coal in India's energy mix would decline, but the absolute consumption volume may still rise.

 

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