India Delays Coal Flexibility Plan Amid Cost Concerns
India has postponed by a year its plan to make coal-fired power plants reduce output during periods of high solar generation, as regulators continue to assess compensation mechanisms for the additional costs involved. According to documents reviewed by Reuters, the delay stems from the absence of clear rules to offset expenses linked to retrofitting plants, which is necessary to lower their minimum operating capacity from 55% to 40%. The move comes as India grapples with balancing its growing renewable energy capacity and the operational limitations of its coal-based power infrastructure.
The lack of flexibility in coal power generation is increasingly posing challenges to India’s clean energy ambitions. Analysts warn that without adaptive coal operations, excess solar power may go to waste, leading to higher emissions and increased compensation costs. Solar generators forced to cut output due to inflexible coal plants could receive up to $76 million in compensation for the eight months ending December, according to estimates by energy think tank Ember. These costs are expected to be passed on to consumers, adding pressure on electricity tariffs.
While retrofitting coal plants is considered significantly cheaper than deploying battery storage—costing between ₹0.28 and ₹0.60 per kilowatt-hour compared to ₹5.76 to ₹6.04—concerns remain over equipment durability and maintenance. State-run utility NTPC has cautioned against potential wear and tear from operating at lower loads, urging further studies. Meanwhile, officials from the Central Electricity Authority maintain that international experience shows such operations can be safe if plants are properly upgraded. Authorities, including regulators and industry stakeholders, have agreed to conduct further analysis before moving forward.
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