Overall electricity generation rose 16.1 per cent in August, while coal-fired power output rose 23.7 per cent from a year earlier, a Reuters analysis of daily load despatch data by federal grid regulator POSOCO showed.

Data from the Central Electricity Authority showed over half of the 135 coal-fired power plants had less than a week's supply of coal left, of which 50 plants had fewer than three days of coal left. Six plants had run out of coal.

India mainly imports from Indonesia, Australia and South Africa. The government has been seeking to cut imports.

India has also asked Coal India to prioritize supplies to thermal power plants with low stock and dispatch fuel from mines with abundant inventory to address the shortage.

Coal supply by the state-run miner, which accounts for over 80 per cent of India's coal output, rose 9.5 per cent in August compared with last year, but was down 3.8 per cent compared with July.

Rise in coal use

In the first eight months of 2021, coal-fired electricity generation jumped 19.3 per cent, faster than the 14.5 per cent growth in renewable energy generation, POSOCO data showed.

The share of coal-fired generation in the period rose to 72.9 per cent, in line with 2019 levels but above the 69.2 per cent in the same period of 2020. Overall power use tumbled in the first half of 2020 amid coronavirus lockdowns but surged after restrictions were eased.

A power ministry official said the installation of new renewable power sources had been slower than expected, at a time when power demand had risen more 13 per cent.

Trading volumes in India Energy Exchange (IEX) rose 74 per cent to a monthly record in August.

"High cost of imported coal and LNG as well as lower wind power generation led to the increase in the electricity prices," IEX said in a statement.

LNG and petcoke

Coal imports by utilities rose 3.4 per cent in the June quarter, while LNG imports fell by a fourth and petcoke imports fell by a third, government data showed.

Traders say lower shipments of LNG by utilities and petcoke were driven mainly by higher prices, further pushing up coal imports.

Vasudev Pamnani, director of consultancy Lavi Coal, said he expected imports to return to pre-pandemic levels by the end of the year.

"Absence of new investment in coal mining and closure of many mines around the world have pushed prices up," Pamnani said.

However, higher prices could weigh on Indian imports of coal.

"In the next few months, elevated prices of foreign-origin coal and petcoke is likely to push cement companies to buy petcoke from domestic refiners," Kirit C Gandhi, joint president at Indian cement firm Shree Cement said.

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