India's aluminium companies have sought the help of the Prime Minister's Office for immediate resumption of coal supplies to save domestic industries and jobs.
With the industry’s captive power plants (CPPs) left with critically low coal stocks of only three to four days, as against the prescribed level of over 15 days, there is a possibility that those employed at the plants and the several thousand ancillary and downstream industries may struggle to remain gainfully employed in the coming days, an aluminium industry body said in a letter to PMO.
"With Coal India Ltd continuing to give unjustifiable priority to the power sector despite improvement in coal stocks, the supplies to the non-power sector have declined by a staggering 18.2 per cent in the last few months (September 2021-January 2022) compared to the same period last year. At the same time, coal stocks for the power sector have improved by 20 per cent for the same reporting duration," it said.
According to the industry's premier body Aluminium Association of India (AAI), the industry requires an uninterrupted power supply through in-house captive power plants operating day and night.
According to AAI, the industry has invested over Rs 50,000 crore to set up captive plants near the coal mine pit heads that are designed to operate on domestic coal grades from these mines.
"Therefore, the coal demand for these CPPs cannot be suitably met simply through imports, due to both economic and technological constraints. The logistics involved in sourcing coal is also prohibitive as the large quantities could lead to the congestions of the rail networks and ports in India," it said.
Producing a single ton of aluminium needs nearly 14,500 units of continuous power. Any outage of more than two hours can cause the molten aluminium in the smelting pots to freeze, leading to plant shutdowns of nearly 6 months and a further year to begin generating the metal at the desired purity levels again.
With captive plants already facing a backlog of over 1,200 rakes, the AAI has urged the PMO to ensure on priority a supply of at least 25-30 coal rakes per day to the sector.
Aluminium, a power-intensive sector, requires 15 times more electricity than steel and 145 times more power than cement to manufacture one tonne of the product. Coal accounts for around 40 per cent of aluminium’s production cost.
In the last letter to the PMO in October last year, the industry stated that the collapse of the sector will lead to the risk of livelihood for over one million local people, banks’ debt exposure of over Rs 1 lakh crore and additional national forex loss of Rs 90,000 crore.
Check out latest DH videos here