Coal-based Economy in India: Post 2030

By: Nitya Nanda, and Saswata Chaudhury
Abundant and cheap availability of domestic coal led India to follow a coal centric development path in the past. Given the current trends in production and consumption, India is expected to exhaust its coal reserves within the next four decades.
Resources

Coal is the second largest source of energy worldwide, after mineral oil. In India, more than 80 per cent of thermal power generated is coal based. As per most projections, this coal-centric energy structure may continue for at least the next couple of decades.

India is a leading coal producer, consumer and importer. Indian coal consumption has increased from 411 million tonnes in 2001 to 793 million tonnes in 2013 and shows an increasing trend. In spite of increased domestic production (from 452 million tonnes in 2007 to 613 million tonnes in 2013), coal import has increased (from 54 million tonnes in 2007 to 180 million tonnes in 2013, of which 142 million tonnes were of the steam coal variety), as per the statistics made available on http.://www.worldcoal.org. This is partly due to the increasing gap between production and consumption as well as the low quality of domestic coal.

In the past, India’s dependence on coal was mainly due to the abundant availability of coal and low cost of recovery. This saw Indian power generation being generally coal based. In the current context when coal is neither cheap nor domestically abundant (in good quality), relying on coal becomes questionable. Apart from these, there are social and environmental issues related to thermal power. Besides, given the current trends in production and consumption, India is expected to exhaust its coal reserves within the next four decades.

The increasing trend of resource nationalism and export restrictive measures in countries exporting coal and global price hikes make the situation even more problematic. It may hence, prove difficult to continue with coal-centric development, in spite of coal remaining an important source of energy in the near future. Thus, India will need to strategise and reduce its dependence on coal through diversification of its energy basket.

Environmental and Social Challenges

Unless carefully planned and controlled, coal mining can take a huge toll on the environment. The different stages of coal mining and cleaning, ranging from transportation to electricity generation to mine closure, can play havoc on the environment, directly or indirectly. Major environmental challenges related to coal mining include emission of SOx, NOx, CO, CO2 and other harmful gases, destruction of forest and biodiversity, release of particulate matter and dusts, besides land degradation and subsidence.

In India, most coal reserves are concentrated within forests and river basins inhabited by indigenous communities or are densely populated. Any mining activity hence, involves large scale relocation and loss of livelihood for indigenous populations, apart from destruction of natural resources. Since opencast mining is widespread in India, the corresponding socio-environmental costs are high.

As compared to underground mining, opencast mines require large tracts of land and can result in significant loss of habitat and livelihood. Mining-induced displacement has increased significantly since the 1970s as the country’s coal production has shifted from underground to opencast. The Ministry of Coal estimates that a minimum of 1, 70, 000 families, involving over 8, 50, 000 people would be affected by future coal projects, as per its Coal Vision 2025 report, compiled in 2005.

Workers engaged in coal production at the mining, processing and burning stages are exposed to several risks and health hazards, including inhalation of crystalline silica dust during highwall drilling and mining that can lead to black lung disease, inhalation of toxic fumes and gases and exposure to ultraviolet and infrared radiation at welding operations, as also noise-induced hearing loss due to prolonged exposure to processing and mining equipment; besides heat stroke and exhaustion.

In view of the issues involved, we need to urgently implement measures to increase production efficiency. This can be done by firstly, extracting more coal from existing reserves and, secondly, producing more energy from the same amount of coal.

Technology Options

These dual objectives can be achieved by employing clean coal technologies (CCTs) that can reduce emissions upstream, downstream, or within the power generation (energy conversion) process. CCTs need to be used right from the coal mining stage. A shift from opencast mining to underground mining using efficient technology and internationally acknowledged improved practices not only minimises land degradation and pollution of water and air, but can vastly reduce the displacement of people. Adoption of suitable technologies can, hence, result in reduced particulate and greenhouse gas emissions along with efficiency gains at the combustion stage, as pointed out by N Nanda, in his paper, ‘The potentials of clean coal technologies in promoting energy security in India’, presented at the World Clean Coal Conference in New Delhi, held in February, 2015.

However, there are several challenges in implementing these technologies in India. They include patent restrictions, insufficient adaptation of technologies to local conditions, shortage of trained manpower, absence of relevant institutions and mechanisms, high capital investment, and lack of government incentives and enabling policies. The government, though, is currently taking initiatives to introduce CCT in India through various research and development programmes, demonstration plants, and pilot studies. Foreign collaborations at the governmental level can increase access to these technologies. Besides, India has also launched the national mission on clean coal technologies under its National Action Plan on Climate Change (NAPCC).

Even if the idea of CCTs is relatively new, India has been leaning towards similar policies since the ‘80s. Underground coal gasification (UCG) had been adopted several decades ago by the Oil and Natural Gas Commission (ONGC) and Coal India Limited (CIL), with technical assistance from the then USSR. Unfortunately, although UCG was found to be technologically feasible in one block, little progress was achieved due to other considerations. Similarly, Oil India Limited (OIL). had undertaken test work, pilot plant runs and feasibility studies on underground coal liquefaction (UCL) using direct liquefaction technology from the USA. But relatively high costs prevented commercial operations.

Potential Future Scenario

Currently, India is extracting coal through opencast and underground mining. However, about 90 per cent of the coal in India is opencast, with the depth normally never beyond 60 m. Though there are mines in India that extract coal from 600 to 1200 m, such as those in Moonidih and Chinakuri, they are few and contribute a very insignificant percentage to total coal production. In underground mines, the depth is generally never beyond 300 m. Since expansion in the last few years has been through the opencast mode, India is fast depleting its reserves.

As on 01.04.2014, Indian coal reserves (including proved, indicated and inferred) were estimated at 301 billion tonne (267 in 2009), of which 266 billion tonnes comprised the steam coal variety. Of the total steam coal reserves, more than one-third is available at a depth of more than 300 m. These include coal lying beneath villages and towns, sanctuaries/forests, rivers, water bodies and the like, as also coal already extracted. The exact figure for extractable coal reserves in India remains unknown, but the Central Mine Planning and Design Institute (CMPDI) broadly assesses it to be 52 billion tonnes.

Through gasification technology, it is possible to access coal up to a depth of 1.5 km . The range may increase in future, and may address both energy security and environmental concerns. Such technologies also help access reserves using much less land; this might prove a boon with lands becoming difficult to acquire in recent times.

On the other hand, technologies like carbon capture and storage (CCS) might prove inappropriate in the Indian context, since CCS not only gives less energy per unit of coal but also requires more land.

Each of these low pollution technologies are usually less labour-intensive. However, while shifting from opencast to underground mining reduces pollution, it increases labour intensity as well. Complementary technologies like UCG or UCL are, on the other hand, are less labour intensive. Thus the combined effect of both is not easy to predict.

In the near future, as India moves on to more renewable power options, our dependence on coal is bound to reduce. But the high investments on green power do not guarantee instant solutions. Hence, if we must continue our dependence on coal-centric development, it is important to explore more efficient and less polluting technologies. In that context, the country may need to confront a trade-off between fewer jobs and environmental concerns.

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