Coal power to get costlier

This report by Ember analyzes the rising effective costs of coal power in India due to declining Plant Load Factors (PLFs). It argues that underutilisation is driving up both fixed and variable costs, making new coal capacity economically inferior to Firm and Dispatchable Renewable Energy (FDRE).

• The effective cost of coal power in India is projected to rise by nearly 25% as Plant Load Factors (PLFs) decline. This increase is primarily driven by underutilisation, which accounts for nearly 85% of the effective cost rise because fixed costs are spread over fewer units of generation.
• India's average coal PLF is expected to drop to approximately 55% by FY 2031–32. Consequently, the weighted average cost of the existing coal fleet is projected to increase from INR 4.78/kWh (USD 54/MWh) at current levels to INR 6.05/kWh (USD 70/MWh) by FY 2031–32.
• Declining utilisation increases both fixed and variable costs. Fixed costs rise due to underutilisation, required retrofits costing between INR 100–400 million (USD 1.15-4.60 million) per unit, and higher O&M expenses from ramping. Variable costs increase due to a 7–9% rise in station heat rate (SHR), a 2–4% increase in auxiliary power consumption per kWh, and restart expenses adding INR 10–25 million (USD 0.11-0.29 million) per unit.
• New coal capacity is becoming prohibitively expensive, with tariffs exceeding INR 6/kWh in Bihar and INR 5.85/kWh in Madhya Pradesh. These costs are now comparable to or higher than Firm and Dispatchable Renewable Energy (FDRE) tariffs, which range from INR 4.3–5.8/kWh.
• Ember concludes that India does not require additional coal capacity before FY 2031–32, as the ~35 GW currently under construction is sufficient to meet power sector goals and adequacy needs.

APA

Ember (2025). Coal power to get costlier. https://ember-energy.org/chapter/coal-power-to-get-costlier/

Chicago

Ember. Coal power to get costlier. 2025. https://ember-energy.org/chapter/coal-power-to-get-costlier/.

Wikipedia

{{cite report |author=Ember |title=Coal power to get costlier |date=29 October 2025 |url=https://ember-energy.org/chapter/coal-power-to-get-costlier/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ember2025coal, author = {{Ember}}, title = {{Coal power to get costlier}}, institution = {Ember}, year = {2025}, month = oct, url = {https://ember-energy.org/chapter/coal-power-to-get-costlier/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }