BAMBOLIN, Goa, India, Feb 20 (Reuters) – Coal-fired power in India is being increasingly priced out of the market by cheaper renewables such as solar, with the dirtier fuel abandoned by private capital, and only projects with government support being viable.
If there was one major theme at this week’s annual industry gathering, Coaltrans India, held in the resort state of Goa, it was that the domestic coal sector is under siege, and probably faces a future of limited growth and eventual disbandment.
Rather than politics, the reason is largely economic, with power purchase agreements (PPAs) for renewables now coming in at levels at which even existing coal-fired plants cannot compete.
Coal is in an “unfair fight” and is increasingly losing, said Tim Buckley, director of energy finance studies at think tank the Institute of Energy Economics and Financial Analysis (IEEFA).
While IEEFA is unashamedly pro-renewables, the numbers definitely support the view that coal power generation is struggling in India, and that several newly-built plants run the risk of becoming stranded assets.