The government's plan aims to maximise green energy potential and save costs, the letter sent to top energy department officials of state and federal government said, but will not involve shutting down old and expensive power plants, according to a Reuters report. India has 173 coal-fired plants.
In the letter dated May 26, the power ministry said that the thermal power plants in future shall operate up to the technical minimum to accommodate cheaper renewable energy when it is available.
The country faced a crippling power crisis in April, its worst in more than six years, when a rapid surge in power demand lead to a scramble for coal, forcing the nation to roll back plans to cut thermal coal imports to zero.
An increase in peak power consumption during the night when solar power is not available has made phasing out coal-fired generation a big challenge. The addition of alternative sources such as nuclear and hydro power have also been slow.
India is the world's second largest consumer, producer and importer of coal, and the fuel accounts for nearly 75% of annual electricity generation.
The world's third largest greenhouse gas emitter is currently 37% short of its end-2022 green energy target.
India's current power crisis could have been averted if its target to install 175 GW in renewable energy had been on track, think tank Climate Risk Horizons said in a report in May.
"The additional generation from solar and wind ... would have allowed power plants to conserve their dwindling coal stocks for evening peak periods," Climate Risk Horizons said.
The power ministry's plan to reduce coal-fired generation when renewable sources are available could also ease pressure on logistics. India's power crisis has been made worse by a shortage of trains to move coal.
India expects the plan to reduce power generation by 58 billion kilowatt hours (kWh) from the 81 utilities to save 34.7 million tonnes of coal and cut carbon emissions by 60.2 million tonnes, the letter said.
Coal India to import for first time in years
State-run Coal India will import the fuel for use by utilities. It would be the first time since 2015 that Coal India has imported the fuel, highlighting efforts by state and federal officials to stock up to avoid a repeat of April.
"Coal India would import coal for blending on government-to-government (G2G) basis and supply ... to thermal power plants of state generators and independent power producers (IPPs)," the federal Power Ministry said in the letter.
The power ministry has also asked states to suspend tenders that are "under process".
"The tenders under process by state generators and IPPs for importing coal for blending may be kept in abeyance to await the price discovery by Coal India through G2G route, so as to procure coal at least possible rates," the ministry said.
Coal inventories at power plants have declined by about 13% since April to the lowest pre-summer levels in years.
