JSW Energy

Fuel Supply & Price UncertaintyCheaper Power Demand by Consumer

1Apr 10, 2023

Apr 10, 2023

2JSW Energy

Coal- The Mainstay for Power Generation In India

Apr 10, 2023

3JSW Energy

High Dependence on Coal

62%

65% 65%

63%59%

54%56%

58% 60%

0%

10%

20%

30%

40%

50%

60%

70%

0

50

100

150

200

250

300

End of 6th Plan

End of 7th Plan

End of 2 year Plan

End of 8th Plan

End of 9th Plan

End of 10th Plan

End of 11th Plan

31-03-13 30-06-14

Nuclear Diesel RES Gas Hydro Coal/Lignite % share of Coal

Inst

alle

d C

apac

ity

in G

W

Approx. 60% share of Coal Based capacity – Continuous disproportionate use of resources - Depletion of Coal reserves

Source-CEA

Apr 10, 2023

4JSW Energy

Increasing reliance on imported coal

Imported Coal Supply rise from 10 MT to 63 MT (almost 6 times)Generation loss due to shortage of Coal still persists whereas generation loss due to poor quality coal has higher share.

1016

2331

45

63

11

15

8

12

16

0

2

4

6

8

10

12

14

16

18

0

10

20

30

40

50

60

70

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

Met

ric To

n

Imported Coal and Generation Loss due to Coal Shortage

Imported Coal Supply (MT) Loss of BUs

Loss

in B

Us

Source-CEA

Apr 10, 2023

5JSW Energy

Challenges in Domestic Coal Production

• Delay in Environmental Clearances

• Land Acquisition, Rehabilitation & Resettlement

• Transportation - Overloaded Railway Infrastructure, - Distance of Railway Network to Mines

• Quality of Coal – High Ash Content

• Pilferage – Illegal Mining

Apr 10, 2023

6JSW Energy

Challenges in Imported Coal

• Uncertainties: - Imported Coal Prices - Currency Exchange - Import Duty - Shipping Costs

• Change in Foreign Law

Apr 10, 2023

7JSW Energy

Summary – Coal Dependent Indian Power Sector

1. India’s dependence on coal for power generation will continue to be significant.

2. Domestic reserves are large but face serious issues in exploitation for various reasons

3. Need to introduce commercial mining to improve domestic coal availability, sooner rather than later.

4. Imported Coal based plant suffering losses on account of under recovery of energy charges

5. Coal India unable to provide 100% Coal under linkage, however on the other end we are exporting power generated on domestic coal to neighbouring countries.

Apr 10, 2023

8JSW Energy

Gas- Peaking Power Fuel

Apr 10, 2023

9JSW Energy

Gas Based Idle Capacity

8 9 123 6

10

34

1213 14

1617 17

18

0

2

4

6

8

10

12

14

16

18

20

0

5

10

15

20

25

30

35

40

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

Generation loss due to Shortage of Gas (BUs) Capacity (GW)

Ge

ne

rrati

on

Lo

ss (B

Us)

Cap

acit

y(GW

)

Gas supplies increased with the KG D6 basin production starting in FY10, but fell in ‐FY12 and FY13 due to the D6 production falling below anticipated levels

Apr 10, 2023

10JSW Energy

Summary - Gas

• Gas availability to the power sector has been uncertain.

• Poor financial health of power distribution companies does not support the gas based generation.

• Implementation challenges in gas pooling: seems unviable

• Power Sector : priority in gas allocation ? Government intervention required to maintain availability of gas to the power sector.

• Options for supporting gas based generation : – gas based generation for peaking power requirements. – Use of natural gas over coal to reduce environmental/socio economic ‐

impacts of coal based generation, etc.

Apr 10, 2023

11JSW Energy

Consumer demands cheaper power

• State Discoms (major buyers of power) are in dire financial crisis.

• Increasing gap between procurement cost and retail tariff.

• Few Discoms preferring load shedding instead of procuring power even at reasonable tariff.

• Electricity tariff has not been rising with pace of other basic commodities (petrol, diesel, milk, food items)

• Change in consumers attitude is also required. – Consumers are willing to pay for high cost diesel generated power but resist tariff increase by Discoms.

Apr 10, 2023

12JSW Energy

How to make power affordable?

• Optimum fuel mix.

• Rationalising the domestic coal prices. - Prices of indigenously mined coal needs to be aligned to global market to

prevent distortion in the energy market in India. (• Reduction in AT &C Losses.

• Reforms in Distribution Sector.

• Improved Transmission Infrastructure.

• Renovation and Modernisation of the old power plants for improved efficiency.

Apr 10, 2023

13JSW Energy

Thank You