Chhattisgarh says won’t build new coal power plants in the state

The central Indian state of Chhattisgarh, home to the country’s third-largest coal reserves, will not build any new coal power plants, Shailendra Kumar Shukla, chairman of Chhattisgarh State Power Distribution Company, a state-owned utility, told Quartz India.

This comes only days after the government in the western state of Gujarat announced it will not give permission to build new coal power plants. Neither state, however, has made the decision permanent via legislation.

Chhattisgarh already has a large number of coal plants that meet a vast majority of the state’s electricity demand and also export to other states. These plants are under-used, though, which means any future increase in the state’s power demand could be easily met.

The state-owned National Thermal Power Corporation (NTPC) is building a 1,600 MW coal-fired power plant in Raigarh district, where half the capacity is committed to meet Chhattisgarh’s needs. Shukla said this would be the last such plant to be built in the state.

Falling costs of solar power and the state’s responsibility to contribute to the ambitious national goal to build renewable power plants mean that Chhattisgarh is likely to rely on using solar to fill up any excess demand.

Chhattisgarh is commissioning a solar farm that can generate 100 MW of power, along with batteries that can store 150 MWh of energy. About 400 hectares of land has been allocated for the solar project and its future extensions in Rajnandgaon district. The state has signed a memorandum of understanding with the Solar Energy Corporation of India, which auctions renewable projects for developers.

Chhattisgarh’s decision will likely hit the coal industry harder than Gujarat’s move because the former has 16 per cent of India’s total coal reserves. Coal power plants in Chhattisgarh offer cheap electricity, thanks to the low cost of transporting coal from the mine to the power plant lower costs.

The state’s power requirement is about 4,500 MW. Power plants located in Chhattisgarh have the capacity to produce more than 20,000 MW of power. Even though it has excess power capacity, Chhattisgarh is also required to meet renewable-energy goals to contribute to national targets. A policy initiative to install rooftop solar panels in government buildings is in the works in the state. 

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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