CIL eyeing different business models to expand renewable segment 

Shobha Roy | | Updated on: Mar 08, 2022
Pramod Agarwal, Chairman and Managing Director, CIL

Pramod Agarwal, Chairman and Managing Director, CIL

Aims at becoming a net zero emissions company

Coal India Ltd (CIL) is looking at different business models to expand its renewable segment and aiming at becoming a net zero emissions company “at the earliest” by focusing on clean coal technologies, mechanised evacuation and cleaner transportation.

The company aims at setting up 3GW solar generation capacity by FY24. CIL has participated in and won 100 MW capacity at ₹2.2/kWh in GUVNL tender and the project is at commissioning stage. It is also considering to bid for another GUVNL tender.

The company has already incorporated two subsidiaries namely CIL Navikarniya Urja Ltd and CIL Solar PV to venture into solar power business.

According to Pramod Agrawal, Chairman and Managing Director, CIL, of the 3,000 megawatt (MW), the company has already placed an order for 190 MW , and another 90MW is in the pipeline, for which the order is expected to be made “very soon”. This apart, another 100 to 150 MW is also in pipeline.

The company has been bidding in whatever discounts have been coming forward, however, it has not been very successful as unfortunately the market has been fluctuating and the taxes have increased substantially, Agrawal said in the earnings conference call recently.  “Now we are planning to establish solar power plants on our own land which is lying vacant, which will perhaps bring down the cost of generation and we can bid,” he said.

During 2020–21, a total of 3.74 million units were generated from solar installations commissioned at various subsidiaries. Other than solar initiatives, CIL will look for partners for its diversification plans, it said.

The company’s wholly owned subsidiary CIL Navikarniya Urja has been established to venture into new business area of new and renewable energy (non-conventional) segment including solar, wind, small hydro, biomass, geo-thermal, hydrogen, tidal, etc.

Net zero emissions

CIL is a producer of coal and not an end user. Some of the negative contributing factors are its emissions footprint during production and transportation of coal, energy usage and adverse environmental impact due to mining of coal, CIL said in a conference call recently, after declaring its Q3 results.

However, some positive contributing factors include emission reduction through mechanised evacuation, cleaner transportation, reduced energy and water consumption, clean coal technologies, focus on renewables and enhancing green cover among others.

The company would strive to achieve a ‘net zero’ sum of negative and positive contributing factors at the earliest, it said.

Cleaner coal production process

CIL has been stepping up focus on minimising carbon emissions through implementation of mechanised coal transportation and loading through coal handling plants (CHP)/silos under its first mile connectivity (FMC) initiative.

Under Phase-I, nearly 35 projects of 414.5 MTPA have been awarded at a capital investment of ₹10,750 crore and six projects of 82 MTPA have been commissioned till date.

Under Phase-II, around nine projects with total capacity 55 MTPA will require an investment of about ₹2,500 crore. The company aims at completing all projects under Phase I by FY-24, and those under Phase II by FY-25.

The company expects improvement in coal quality, savings in under-loading charges and a positive impact on the environment, it said.

This apart, CIL is considering closing unviable mines with lower quality coal. While 147 underground mines employ 42 per cent of the workforce, they contributes only around 4.47 per cent of total production.

“Action is being taken to close the unviable mines in CIL in a phased manner. Production from 13 (11 mines in 2020-21, two mines in 2021-22) underground mines has already been suspended,” it said.

CIL will also be investing in procuring more efficient and productive machines that have lower carbon footprint.

Published on March 08, 2022
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