In order to power India, Coal India produces 82 per cent of country’s overall coal output and meets 46 per cent of the nation’s primary commercial energy, says Partha S Bhattacharyya
With high rates of economic growth and over 15 per cent of the world’s population, India has become a significant consumer of energy resources. The global financial crisis and credit crunch have slowed India’s economic growth particularly in the manufacturing sector, and GDP growth rates have also declined from 9.3 per cent in 2007 to 7.1 per cent in the fiscal ended March 31. Interestingly, despite a recent slowing economy, India’s energy demand continues to increase. The country’s ability to secure a reliable supply of energy resources in a sustainable manner and at affordable prices will be one of the most important factors in shaping its future growth prospects.
Energy Roadmap & Dominance of Coal
As energy security becomes an increasingly important issue even on the political stage post Copenhagen, coal remains a constant. Few wars were fought over coal and with current known reserves estimated at, depending on who you believe, between 130 to 500 years, it is going to be a near impossible feat to dislodge this maligned fuel from the energy mix, at least in the foreseeable future. Globally, coal accounts for 29 per cent of the primary energy consumption but in India, it has a share of 54 per cent which is followed by oil (31%). Natural gas and hydroelectric power account for 8 and 6 per cent of consumption, respectively. In respect of generation of power, the share of coal on global basis is 41 per cent and in Indian context, it is around 70 per cent.
The Indian economy depends significantly on the pace of growth in mining of coal and other minerals to sustain a growth rate of 8 to 10 per cent over the next 25 years. Sustaining such high growth rate calls for accelerating pace of energy supplies. To achieve this end, Government of India constituted an Integrated Energy Policy (IEP) Committee in August, 2004. The report emphasizes continuing dominance of coal in the Indian energy scenario over the next 25 years.
The coal demand, as projected in the IEP document, is expected to rise at an accelerated pace and in 2031-32 be within the range of 1,600 million tonne (least coal consumption strategy) or 2,600 million tonne (continuing the present trend). As compared to current consumption of 460 million tonne per annum, this represents a CAGR of 5.11 to 7.17 per cent. A CAGR of a little over 6 per cent shall be required to support coal consumption @ 2,000 mtpa in 2031-32.
Nevertheless, in the short term, growth in coal mining at more than 8 per cent per annum for the next 5 to 6 years as compared to a modest rate of 5.4 per cent, achieved in the preceding five years is necessary to sustain the growth of the economy in general and to meet the anticipated demand arising from the addition to coal based thermal power energy generation capacity by more than 60,000 mega watt by 2012. This by itself is a major challenge for the coal sector in the country.
The dominant position of coal in energy consumption and electricity generation in India is likely to continue for decades because of comparatively comfortable proven reserves position of coal vis-a-vis the increasingly depleting reserves of oil and natural gas.
It is evident that there will be no dearth of market for coal and if coal could be produced at reasonable cost on a sustainable basis, Coal Industry in India should continue its dominance as the primary source of energy for most part of 21st century.
Strategic Relevance of Coal in India & Challenges
In order to power India, Coal India produces 82 per cent of country’s overall coal output and meets 46 per cent of the nation’s primary commercial energy. CIL offers coal at a deeply discounted price compared to International prices. This enhances Global competitiveness of end users. The benefit is generated without creating any burden on Government or on the company.
The Working Group on Coal & Lignite in its report in November 2006 has projected coal demand in the terminal years of XI and XII Five Year Plans i.e. 2011-12 and 2016-17 of around 731 and 1,121 million tonne in the respective years. The corresponding coal production is assessed at 680 million tonne and 1,051 million tonne respectively. Out of the above, the share of Coal India is projected to be of the order of 521 (77%) million tonne and 665 (63%) million ton respectively. Considering the fact that the highest rise achieved by CIL in any Plan period (X Plan) so far is around 81 million tonne, the increase in coal production during Xl Plan (160 million tonne) and XII Plan (144 million tonne) are major quantum jumps.
The country production target of 680 million tonne by the terminal year of XI plan is getting tough because of delays in obtaining statutory clearances for starting new projects by CIL and captive coal blocks. Considering the delays by Environment and Forest Ministry in granting clearance and also by State Governments in granting requisite clearances, reaching a production level of 620 million tonne by the terminal year of eleventh Plan seems reasonable enough. CIL may end up missing the 500 million ton mark and the captive blocks will be short of target by atleast 25 million tons.
Despite falling short of targets, India’s coal import will not increase proportionately as expected demand too is likely to be lower than initial estimates because of delays in commissioning of new power projects. India may end up adding around 60 to 65 GW of additional power generation capacities in the XI Plan against the target of 79 GW so the total demand of coal will be much less than 731 million tons estimated earlier. As the initial demand is not going to materialize, it is hoped that eventually the demand and supply will match and the import figure initially, estimated will remain unchanged. Again, the hurdles in importing coal — mainly higher cost and inland transportation from the ports as well as risk factors associated with imported fuel seem to outweigh the benefits. With 3/4th of the additional capacity of 100 GW envisaged in the XII Plan will come up in thermal sector, the role and responsibility of CIL is going to increase manifolds.
The real challenge for the coal sector lies in increasing production from captive blocks allotted to companies in power, cement and steel sector. Although 214 blocks with an estimated reserve of 48 billion tons had been allotted to private and PSU operators, production has begun from only 25 blocks. 104 million tonnes target in the terminal year of XI plan seems quite a tall task given the hurdles like land acquisition, delay in getting environmental clearance and lack of rail connectivity to evacuate coal from captive coal blocks. Several companies that have been granted such blocks are going slow on development.
Vision Ahead: New Projects, Exploration Needs, Foreign Ventures
Being an extractive industry, every producing unit has its own rated life due to eventual depletion of reserves. Existing and completed mines/projects show a sinusoidal trend of production over a period of time due to liquidation of reserves. This decrease and subsequently the level of targeted growth are compensated by ongoing and future projects which contribute higher production than its predecessors.
At present, there are 154 ongoing projects in CIL at different stages of implementation with a sanctioned capacity of over 400 Mty and capital of Rs 24,772 crore. Out of these, 58 are underground projects (sanctioned capacity 28 Mty) and 96 are opencast projects (sanctioned capacity 374 Mty). 83 projects out of the above 154 ongoing projects are planned to produce 172 Mt during the year 2009-10 and have already contributed over 106 Mt till November 2009. In addition to the above, 67 projects also identified to be taken up during Xl plan period are in different stages of formulation and approval with proposed capacity of 210 Mty and estimated investment of about 26,842 crores.
In order to bring the Indicated & Inferred categories of resources under the proven head by enhancing its exploration capacities particularly beyond 300m depth to boost UG mining in the long run. This poses a major challenge in the area of technology infusion and absorption. Inferior and inconsistent quality of coal is a problem that needs to be addressed by taking recourse to coal beneficiation on a much larger scale. Though the cost of production through this means is significantly higher than opencast production and though there is no immediate need for CIL to pursue this harder option, CIL in its role as a responsible Corporate Citizen has opted for this initiative in the national interest, to avoid depletion of easily accessible OC reserves in future and to add longer term sustainability to the reserves.
CMPDI is all set to enhance present drilling capacity of 2 lakh metre per annum to 10 lakh metre per annum by 2011 -12 ( terminal year of Xl Plan) by addition of more drills and hydrostatic drills for increasing in-house capacity as well as utilising the drilling capacity of other public and private drilling companies.
More than three years after we decided to spread our wings and decided to have stake in overseas coal assets, the company has finally met with success. And interestingly, this has not come from Australia, Indonesia or Canada but in Mozambique, tipped to be next most important destination for coal. Two exploratory coal blocks — A1 and A2, with an estimated reserves upto 1 billion tonne was awarded to us. This is the first acquisition of coal blocks abroad on the basis of bilateral cooperation and has been secured in the face of stiff competition from international competitors. That’s one small step from CIL, giant leap for future workings and strategies for the industry as a whole.
Underground Priorities
Production of coal from UG mines have been declining persistently. From a level of 65 Mty in mid seventies, it declined to 43 Mty in 2006-07. It was recognised then that to sustain the reserves for longer period of time, CIL needs to refocus on UG production for tapping large reserves below 300 metres depth. In a paradigm shift, keeping with the recent global trend, Coal India has initiated measures to develop large underground mines by adopting state-of-the-art mass production technology. Besides, High Wall Mining is being introduced. About 20 High Wall Mining Machines are expected to be introduced in next 4 to 5 years in CIL.
CIL has identified seven high capacity underground mining blocks of 2-5 Mty capacity for development and operation on a long- term contract basis by Internationally acclaimed and proven mine developers & operators. It also intends to re-open 18 closed/abandoned mines with reserves over 1600 Mt for extraction of residual coal which have either been closed or mining operations suspended on account of safety and techno-economic considerations. These mines are proposed for Joint Venture participation by Internationally reputed mining companies having technical know-how for safe extraction of residual coal.
Requirement of land, forest/non-forest
Coal mining is site specific and has to be done where it occurs. For this, vast amount of land is required which is the basic raw material for any coal mining company. Delay in acquisition of land is one of the major issues which leads to time and cost over run of coal projects.
Effective proposals and suggestions were made from time to time for reducing the delay in accord of Forestry and Environmental clearances. Revisiting of current practices grant of Forestry clearance within a timeframe of 9 months and delineation of ‘Coal Bearing Area’ into ‘Go’ and ‘No Go’ area are a few to name.
It was also suggested that drilling of 20 borehole/sq km be exempted from permission under FC Act against the existing norms of 15 & 20 boreholes/10 sq km for OC & UG respectively. The cluster concept of environment clearance was also initiated and about 50 mines of BCCL have applied under this concept.
The total forest land required as per PR is 37,098 Ha out of which 16,832 Ha could only be acquired. During the Xl plan the total land requirement is 62028 Ha out of which only 6021 Ha has been acquired till now.
Coal & Environment Sustainability
Coal powered the industrial revolution in the developed world and because it is still cheap and abundant, it is the fuel that is driving development in the emergent superpowers like China and India. But again, on the global and environmental level, it is also the payback time. Climate Change is real and so is the fact that that coal is the biggest polluter of all fossil fuels. It appears that we can’t live with it and we can’t live without it, but it does have the potential to clean up its act. Indian coal is generally low in sulphur but high in ash and low in calorific value. As one step to reduce the ash content and impurities, CIL has taken a policy decision to supply washed non-coking coal to all consumers other than the pit head consumers. Steps have already been taken to set up 19 Coal Washeries for a total capacity of over 100 Mty and will be built up, commissioned, operated and maintained by Private Operators selected through Global Bidding process. Coal India will provide fund and infrastructure facilities like land, power, water, Railway siding. This will go a long way in reducing the environmental effects of coal transportation and usage.
Talking of other clean coal solutions, CBM is being utilized to generate power by 2X250 kW generators and is being supplied to Moonidih project for captive use. A CMM initiative in the same area is on the anvil. Besides, AMM and VAM utilization projects are under consideration. CIL has also expressed its intention to participate in FutureGen, the zero emission power plant being taken up by USA. CIL is also considering UCG and SCG opportunities to open up the possibility of utilizing coal without mining it.
All these solutions are likely to play a part in reducing the emissions from the world's most abundant and cheapest fossil fuel and naturally the role of CMPDIL, our guiding company in this area, is going to be that meaningful. The fuel is under attack for its emissions, but it is also the driver behind industrialization and rural electrification in the developing world. Based on the premise that coal is not going away anytime soon, all efforts should be invested in making it cleaner.
Other Sustainability Issues
Any industry prospers as long as it fulfills the requirements of acceptance, survival and growth. On these criteria, Indian coal industry mainly in the public sector has a crucial role to remain capable of facing the emerging issues and challenges. The quantum jump in opencast mining activities has brought the environmental impact of mining under scanner. In order to promote transparency in environmental sustainability, CMPDI is undertaking the satellite surveillance of all opencast projects of five million cum capacity and more, which will track reclamation and renovation activities and monitor the restoration, made to the original habitat. The satellite images have been uploaded on the website. We are not judging performance of the subsidiary companies only on the basis of quantity of coal produced but also on land reclaimed and restored both physically as well as biologically.
The activities related to acquiring of land for mining bring with it the social sustainability issues, the issues of resettlement of communities due to mining or underground fires/subsidence caused by unscientific mining long back. We have already made some model townships for PAPs (Project Affected People) and also have modified the R&R Policy not only to make it more attractive and acceptable to land losers but also to adopt a more inclusive approach by making them a major stake holder in the development process. As one of the steps in this direction, CIL proposes vesting ownership rights to land losers through issue of its shares once it is listed on the bourses.
In one of the biggest rehabilitation plans in the world, the Government recently cleared the Rs 9773 crore (US$ 2 billion) rehabilitation plan drawn by CMPDlL to relocate some 120 thousand families to safer areas whose houses face the threat of being sucked in by underground fires raging for the last ninety years or so in the vast stretches of Jharia Coalfields and land subsidence in Raniganj Coalfields. The plan shall be largely funded by CIL from its accruals supplemented by levy of additional duty.
Coupled with such efforts, CSR Policy of CIL has been designed in a manner to be pro-active in offering employment to the less privileged class, at all levels of the job ladder. CIL seriously pursues Social Responsibility through its Community Development Activities and recognize it as a core activity in taking its business forward. CIL comprehends that social obligation is much bigger than supporting worthy causes and in true essence impacts people and the quality of their lives. The policy includes development of infrastructure facilities, health, education, social/cultural activities, tree plantation and skill up gradation. It has also provision for institutional arrangements and for up-keep and maintenance of assets created.
Thrust on inclusive growth by making tribals and other backward people living in the coal bearing areas stakeholders in the process of development is fast emerging as a major social challenge. A co-ordinated approach on the lines of Whitehorse Mining Initiative introduced in Canada in early 90s may provide a solution to the problem. It is also time for India to adopt a strategic vision for a healthy mining industry in the context of maintaining a healthy and diverse ecosystem and for sharing opportunities with Aboriginal peoples. It calls for improving the investment climate for investors, ensuring the participation of Aboriginal peoples in all aspects of mining, settling the land claims, adopting sound environmental practices, establishing an ecologically based system of protected areas, providing workers with healthy and safe working environments and a continued high standard of living and creating a climate for innovative and effective responses to change.
Conclusion
With the Indian economy marching ahead like never before and the country’s energy demand skyrocketing, leaves sufficient room for all players in this sector to play enough role. Inspite of various policy initiatives to diversify the fuel mix, the limited reserve of petroleum & natural gas, eco-conservation restriction on hydel projects and limited scope of renewable and nuclear energy compels coal to continue hold the centre-stage of India’s energy scenario. Keeping this in mind there can be no two ways about the need to increase coal production. The coal industry is gearing up to meet the new challenges and shall continue to provide energy security to the country in the years to come.
With high rates of economic growth and over 15 per cent of the world’s population, India has become a significant consumer of energy resources. The global financial crisis and credit crunch have slowed India’s economic growth particularly in the manufacturing sector, and GDP growth rates have also declined from 9.3 per cent in 2007 to 7.1 per cent in the fiscal ended March 31. Interestingly, despite a recent slowing economy, India’s energy demand continues to increase. The country’s ability to secure a reliable supply of energy resources in a sustainable manner and at affordable prices will be one of the most important factors in shaping its future growth prospects.
Energy Roadmap & Dominance of Coal
As energy security becomes an increasingly important issue even on the political stage post Copenhagen, coal remains a constant. Few wars were fought over coal and with current known reserves estimated at, depending on who you believe, between 130 to 500 years, it is going to be a near impossible feat to dislodge this maligned fuel from the energy mix, at least in the foreseeable future. Globally, coal accounts for 29 per cent of the primary energy consumption but in India, it has a share of 54 per cent which is followed by oil (31%). Natural gas and hydroelectric power account for 8 and 6 per cent of consumption, respectively. In respect of generation of power, the share of coal on global basis is 41 per cent and in Indian context, it is around 70 per cent.
The Indian economy depends significantly on the pace of growth in mining of coal and other minerals to sustain a growth rate of 8 to 10 per cent over the next 25 years. Sustaining such high growth rate calls for accelerating pace of energy supplies. To achieve this end, Government of India constituted an Integrated Energy Policy (IEP) Committee in August, 2004. The report emphasizes continuing dominance of coal in the Indian energy scenario over the next 25 years.
The coal demand, as projected in the IEP document, is expected to rise at an accelerated pace and in 2031-32 be within the range of 1,600 million tonne (least coal consumption strategy) or 2,600 million tonne (continuing the present trend). As compared to current consumption of 460 million tonne per annum, this represents a CAGR of 5.11 to 7.17 per cent. A CAGR of a little over 6 per cent shall be required to support coal consumption @ 2,000 mtpa in 2031-32.
Nevertheless, in the short term, growth in coal mining at more than 8 per cent per annum for the next 5 to 6 years as compared to a modest rate of 5.4 per cent, achieved in the preceding five years is necessary to sustain the growth of the economy in general and to meet the anticipated demand arising from the addition to coal based thermal power energy generation capacity by more than 60,000 mega watt by 2012. This by itself is a major challenge for the coal sector in the country.
The dominant position of coal in energy consumption and electricity generation in India is likely to continue for decades because of comparatively comfortable proven reserves position of coal vis-a-vis the increasingly depleting reserves of oil and natural gas.
It is evident that there will be no dearth of market for coal and if coal could be produced at reasonable cost on a sustainable basis, Coal Industry in India should continue its dominance as the primary source of energy for most part of 21st century.
Strategic Relevance of Coal in India & Challenges
In order to power India, Coal India produces 82 per cent of country’s overall coal output and meets 46 per cent of the nation’s primary commercial energy. CIL offers coal at a deeply discounted price compared to International prices. This enhances Global competitiveness of end users. The benefit is generated without creating any burden on Government or on the company.
The Working Group on Coal & Lignite in its report in November 2006 has projected coal demand in the terminal years of XI and XII Five Year Plans i.e. 2011-12 and 2016-17 of around 731 and 1,121 million tonne in the respective years. The corresponding coal production is assessed at 680 million tonne and 1,051 million tonne respectively. Out of the above, the share of Coal India is projected to be of the order of 521 (77%) million tonne and 665 (63%) million ton respectively. Considering the fact that the highest rise achieved by CIL in any Plan period (X Plan) so far is around 81 million tonne, the increase in coal production during Xl Plan (160 million tonne) and XII Plan (144 million tonne) are major quantum jumps.
The country production target of 680 million tonne by the terminal year of XI plan is getting tough because of delays in obtaining statutory clearances for starting new projects by CIL and captive coal blocks. Considering the delays by Environment and Forest Ministry in granting clearance and also by State Governments in granting requisite clearances, reaching a production level of 620 million tonne by the terminal year of eleventh Plan seems reasonable enough. CIL may end up missing the 500 million ton mark and the captive blocks will be short of target by atleast 25 million tons.
Despite falling short of targets, India’s coal import will not increase proportionately as expected demand too is likely to be lower than initial estimates because of delays in commissioning of new power projects. India may end up adding around 60 to 65 GW of additional power generation capacities in the XI Plan against the target of 79 GW so the total demand of coal will be much less than 731 million tons estimated earlier. As the initial demand is not going to materialize, it is hoped that eventually the demand and supply will match and the import figure initially, estimated will remain unchanged. Again, the hurdles in importing coal — mainly higher cost and inland transportation from the ports as well as risk factors associated with imported fuel seem to outweigh the benefits. With 3/4th of the additional capacity of 100 GW envisaged in the XII Plan will come up in thermal sector, the role and responsibility of CIL is going to increase manifolds.
The real challenge for the coal sector lies in increasing production from captive blocks allotted to companies in power, cement and steel sector. Although 214 blocks with an estimated reserve of 48 billion tons had been allotted to private and PSU operators, production has begun from only 25 blocks. 104 million tonnes target in the terminal year of XI plan seems quite a tall task given the hurdles like land acquisition, delay in getting environmental clearance and lack of rail connectivity to evacuate coal from captive coal blocks. Several companies that have been granted such blocks are going slow on development.
Vision Ahead: New Projects, Exploration Needs, Foreign Ventures
Being an extractive industry, every producing unit has its own rated life due to eventual depletion of reserves. Existing and completed mines/projects show a sinusoidal trend of production over a period of time due to liquidation of reserves. This decrease and subsequently the level of targeted growth are compensated by ongoing and future projects which contribute higher production than its predecessors.
At present, there are 154 ongoing projects in CIL at different stages of implementation with a sanctioned capacity of over 400 Mty and capital of Rs 24,772 crore. Out of these, 58 are underground projects (sanctioned capacity 28 Mty) and 96 are opencast projects (sanctioned capacity 374 Mty). 83 projects out of the above 154 ongoing projects are planned to produce 172 Mt during the year 2009-10 and have already contributed over 106 Mt till November 2009. In addition to the above, 67 projects also identified to be taken up during Xl plan period are in different stages of formulation and approval with proposed capacity of 210 Mty and estimated investment of about 26,842 crores.
In order to bring the Indicated & Inferred categories of resources under the proven head by enhancing its exploration capacities particularly beyond 300m depth to boost UG mining in the long run. This poses a major challenge in the area of technology infusion and absorption. Inferior and inconsistent quality of coal is a problem that needs to be addressed by taking recourse to coal beneficiation on a much larger scale. Though the cost of production through this means is significantly higher than opencast production and though there is no immediate need for CIL to pursue this harder option, CIL in its role as a responsible Corporate Citizen has opted for this initiative in the national interest, to avoid depletion of easily accessible OC reserves in future and to add longer term sustainability to the reserves.
CMPDI is all set to enhance present drilling capacity of 2 lakh metre per annum to 10 lakh metre per annum by 2011 -12 ( terminal year of Xl Plan) by addition of more drills and hydrostatic drills for increasing in-house capacity as well as utilising the drilling capacity of other public and private drilling companies.
More than three years after we decided to spread our wings and decided to have stake in overseas coal assets, the company has finally met with success. And interestingly, this has not come from Australia, Indonesia or Canada but in Mozambique, tipped to be next most important destination for coal. Two exploratory coal blocks — A1 and A2, with an estimated reserves upto 1 billion tonne was awarded to us. This is the first acquisition of coal blocks abroad on the basis of bilateral cooperation and has been secured in the face of stiff competition from international competitors. That’s one small step from CIL, giant leap for future workings and strategies for the industry as a whole.
Underground Priorities
Production of coal from UG mines have been declining persistently. From a level of 65 Mty in mid seventies, it declined to 43 Mty in 2006-07. It was recognised then that to sustain the reserves for longer period of time, CIL needs to refocus on UG production for tapping large reserves below 300 metres depth. In a paradigm shift, keeping with the recent global trend, Coal India has initiated measures to develop large underground mines by adopting state-of-the-art mass production technology. Besides, High Wall Mining is being introduced. About 20 High Wall Mining Machines are expected to be introduced in next 4 to 5 years in CIL.
CIL has identified seven high capacity underground mining blocks of 2-5 Mty capacity for development and operation on a long- term contract basis by Internationally acclaimed and proven mine developers & operators. It also intends to re-open 18 closed/abandoned mines with reserves over 1600 Mt for extraction of residual coal which have either been closed or mining operations suspended on account of safety and techno-economic considerations. These mines are proposed for Joint Venture participation by Internationally reputed mining companies having technical know-how for safe extraction of residual coal.
Requirement of land, forest/non-forest
Coal mining is site specific and has to be done where it occurs. For this, vast amount of land is required which is the basic raw material for any coal mining company. Delay in acquisition of land is one of the major issues which leads to time and cost over run of coal projects.
Effective proposals and suggestions were made from time to time for reducing the delay in accord of Forestry and Environmental clearances. Revisiting of current practices grant of Forestry clearance within a timeframe of 9 months and delineation of ‘Coal Bearing Area’ into ‘Go’ and ‘No Go’ area are a few to name.
It was also suggested that drilling of 20 borehole/sq km be exempted from permission under FC Act against the existing norms of 15 & 20 boreholes/10 sq km for OC & UG respectively. The cluster concept of environment clearance was also initiated and about 50 mines of BCCL have applied under this concept.
The total forest land required as per PR is 37,098 Ha out of which 16,832 Ha could only be acquired. During the Xl plan the total land requirement is 62028 Ha out of which only 6021 Ha has been acquired till now.
Coal & Environment Sustainability
Coal powered the industrial revolution in the developed world and because it is still cheap and abundant, it is the fuel that is driving development in the emergent superpowers like China and India. But again, on the global and environmental level, it is also the payback time. Climate Change is real and so is the fact that that coal is the biggest polluter of all fossil fuels. It appears that we can’t live with it and we can’t live without it, but it does have the potential to clean up its act. Indian coal is generally low in sulphur but high in ash and low in calorific value. As one step to reduce the ash content and impurities, CIL has taken a policy decision to supply washed non-coking coal to all consumers other than the pit head consumers. Steps have already been taken to set up 19 Coal Washeries for a total capacity of over 100 Mty and will be built up, commissioned, operated and maintained by Private Operators selected through Global Bidding process. Coal India will provide fund and infrastructure facilities like land, power, water, Railway siding. This will go a long way in reducing the environmental effects of coal transportation and usage.
Talking of other clean coal solutions, CBM is being utilized to generate power by 2X250 kW generators and is being supplied to Moonidih project for captive use. A CMM initiative in the same area is on the anvil. Besides, AMM and VAM utilization projects are under consideration. CIL has also expressed its intention to participate in FutureGen, the zero emission power plant being taken up by USA. CIL is also considering UCG and SCG opportunities to open up the possibility of utilizing coal without mining it.
All these solutions are likely to play a part in reducing the emissions from the world's most abundant and cheapest fossil fuel and naturally the role of CMPDIL, our guiding company in this area, is going to be that meaningful. The fuel is under attack for its emissions, but it is also the driver behind industrialization and rural electrification in the developing world. Based on the premise that coal is not going away anytime soon, all efforts should be invested in making it cleaner.
Other Sustainability Issues
Any industry prospers as long as it fulfills the requirements of acceptance, survival and growth. On these criteria, Indian coal industry mainly in the public sector has a crucial role to remain capable of facing the emerging issues and challenges. The quantum jump in opencast mining activities has brought the environmental impact of mining under scanner. In order to promote transparency in environmental sustainability, CMPDI is undertaking the satellite surveillance of all opencast projects of five million cum capacity and more, which will track reclamation and renovation activities and monitor the restoration, made to the original habitat. The satellite images have been uploaded on the website. We are not judging performance of the subsidiary companies only on the basis of quantity of coal produced but also on land reclaimed and restored both physically as well as biologically.
The activities related to acquiring of land for mining bring with it the social sustainability issues, the issues of resettlement of communities due to mining or underground fires/subsidence caused by unscientific mining long back. We have already made some model townships for PAPs (Project Affected People) and also have modified the R&R Policy not only to make it more attractive and acceptable to land losers but also to adopt a more inclusive approach by making them a major stake holder in the development process. As one of the steps in this direction, CIL proposes vesting ownership rights to land losers through issue of its shares once it is listed on the bourses.
In one of the biggest rehabilitation plans in the world, the Government recently cleared the Rs 9773 crore (US$ 2 billion) rehabilitation plan drawn by CMPDlL to relocate some 120 thousand families to safer areas whose houses face the threat of being sucked in by underground fires raging for the last ninety years or so in the vast stretches of Jharia Coalfields and land subsidence in Raniganj Coalfields. The plan shall be largely funded by CIL from its accruals supplemented by levy of additional duty.
Coupled with such efforts, CSR Policy of CIL has been designed in a manner to be pro-active in offering employment to the less privileged class, at all levels of the job ladder. CIL seriously pursues Social Responsibility through its Community Development Activities and recognize it as a core activity in taking its business forward. CIL comprehends that social obligation is much bigger than supporting worthy causes and in true essence impacts people and the quality of their lives. The policy includes development of infrastructure facilities, health, education, social/cultural activities, tree plantation and skill up gradation. It has also provision for institutional arrangements and for up-keep and maintenance of assets created.
Thrust on inclusive growth by making tribals and other backward people living in the coal bearing areas stakeholders in the process of development is fast emerging as a major social challenge. A co-ordinated approach on the lines of Whitehorse Mining Initiative introduced in Canada in early 90s may provide a solution to the problem. It is also time for India to adopt a strategic vision for a healthy mining industry in the context of maintaining a healthy and diverse ecosystem and for sharing opportunities with Aboriginal peoples. It calls for improving the investment climate for investors, ensuring the participation of Aboriginal peoples in all aspects of mining, settling the land claims, adopting sound environmental practices, establishing an ecologically based system of protected areas, providing workers with healthy and safe working environments and a continued high standard of living and creating a climate for innovative and effective responses to change.
Conclusion
With the Indian economy marching ahead like never before and the country’s energy demand skyrocketing, leaves sufficient room for all players in this sector to play enough role. Inspite of various policy initiatives to diversify the fuel mix, the limited reserve of petroleum & natural gas, eco-conservation restriction on hydel projects and limited scope of renewable and nuclear energy compels coal to continue hold the centre-stage of India’s energy scenario. Keeping this in mind there can be no two ways about the need to increase coal production. The coal industry is gearing up to meet the new challenges and shall continue to provide energy security to the country in the years to come.
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