(Bloomberg) -- Coal India Ltd. is planning to invest about 670 billion rupees ($8 billion) to build coal-fired power plants close to its mines, signaling the fast-growing economy will remain reliant on the fossil fuel for decades to come.
The state-owned miner has already won approval for 4.7 gigawatts of generation to be built over the next six to seven years, with most of the facilities to be in the state of Odisha on India’s east coast, Business Development Director Debasish Nanda said in an interview. Another 2 gigawatts are currently under discussion and may take longer to complete, he said.
The new power stations are in addition to a plan, announced by New Delhi late last year, to add 88 gigawatts of thermal generation capacity through 2032. The world’s most populous country is forecasting electricity demand to surge over the next few years, making it tough to wean itself off coal, which accounts for around three-quarters of the power mix.
The fossil fuel will remain relevant to the country’s electricity mix for at least three decades, Nanda said. Putting these plants near mines will allow the company to avoid transport costs, keeping them competitive, he said, adding that Coal India is also looking to build renewable power stations and get into mining critical minerals.
India has a goal of getting to net zero by 2070, later than other major economies, reflecting the fact that both its population and economy are still growing quickly. However, environmentalists say the government should be doing more to decarbonize the power system.
“Coal is already unsustainable on the four key parameters of climate, environment, social justice and economics,” said Sunil Dahiya, a New Delhi-based analyst at the Centre for Research on Energy and Clean Air. “The government needs to form policies that allow wise use of resources, instead of burdening the power system and the economy with expensive coal-fired electricity.”
