(Updates with comment from analyst in fourth paragraph.)
Aug. 30 (Bloomberg) -- Blackouts in India widened as inadequate coal supplies forced plants to shut down, after increased industrial activity and a monsoon deficit boosted electricity demand from factories and households.
The national peak shortage yesterday expanded to more than 6 percent from the 3.9 percent average in July, according to data from the Power Ministry and Power System Operation Corp., a unit of Power Grid Corp. of India. Stocks at power stations run on local coal plunged. Equipment breakdowns or maintenance also caused other plants to be under shutdown, including ones operated by Tata Power Co. and Adani Power Ltd.
A surge in economic activity has led to higher demand for the fuel, exacerbating supply bottlenecks caused by heavy rains at some mines and slow railway transport in places. India’s economy grew at the fastest pace in more than two years, the Central Statistical Office said in a statement in New Delhi yesterday. Slow economic activity had caused coal stocks at power plants to swell last year.
“We are always vulnerable to coal shortages during this time of the year,” said Prasad Baji, an analyst at Edelweiss Financial Services Ltd. in Mumbai. “The vulnerability becomes more pronounced when demand for coal rises.”
Among the worst affected states are Rajasthan and Uttar Pradesh, India’s most populous. Several towns in Uttar Pradesh, which shares a border with national capital New Delhi, are blacked out for more than 10 hours a day, forcing people to use diesel-fired back-up power that’s at least three times more expensive.
“Coal supplies at some of our plants have been affected due to rains in coal-mining regions,” said Kulamani Biswal, finance director at state-run NTPC Ltd., India’s biggest power producer.
The company’s Vindhyachal plant in Madhya Pradesh has shut four units, aggregating a capacity of 1420 megawatts, according to data from the Power Ministry’s Central Electricity Authority. Three of these units are shut because of coal shortages. Two other plants of the company that supply to the capital are shut, affecting a capacity of 775 megawatts.
India’s gross domestic product rose 5.7 percent in the three months ended June from a year earlier, the biggest gain since the quarter through March 2012.
The Northern Region Load Dispatch Centre, which operates the northern power grid issued an alert on its website, saying there was high demand and reduced availability in the northern region.
Power plants had 8.89 million metric tons of coal as of Aug. 27, down almost 65 percent from a year ago. That stock is sufficient for six days, compared with the 21-day norm the Central Electricity Authority advises. Fifty-two power plants had less than seven days of stock, while 26 were running on less than four days supply.
“We have had problems due to rain the last week of July and first week of August, but our performance has picked up since,” N. Kumar, technical director at Coal India Ltd., said by phone yesterday.
More than 55,500 megawatts of generation capacity is under outage, according to CEA data, which monitors performance of plants with a total capacity of 219,308 megawatts.
Tata Power on Aug. 28 said it had shut down two 800- megawatt units at its 4,000-megawatt Mundra plant in coastal Gujarat state.