India’s coal demand is expected to stay high with electricity generation capacity forecast to grow, speakers at the Coaltrans India Conference in Goa said Tuesday.
The power electricity demand and generation is expected to grow by between 5% and 10% from current levels over the next few years, said Vipul Tuli, chief executive and country head of Sembcorp India.
“The country is electrifying at a good rate with a lot of focus now on household electrification,” Tuli said, adding that power generation could increase at the rate of 10 GW to 25 GW in the medium term above the current capacity of 200 GW.
“Coal will remain very important to meet the base load needs as renewables, despite dropping prices, have not reached grid parity as yet,” he said. The volume of coal imports into India depends on the landed price, according to end-user sources.
The market consensus was that demand drops drastically when the CFR price of 4200 kcal/kg GAR coal grade crosses $55/mt. India’s thermal coal imports in 2016 and 2017 showed diminished appetite for seaborne cargoes as prices have gone up.
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