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Increase in Domestic Coal Production May Help the Power Companies

News

Dependence on coal imports will reduce to up to eight per cent only if Coal India (CIL) meets the production of 1,000 million tonnes by 2020.

Source: ET

SNP Insight

The reduce dependency on imported thermal coal may help power companies to save cost on fuel expenses. This may also help them to hedge the risk of rupee exchange rate in international market on coal import. The lower possibility of fuel cost variation may reduce the risk of forcing the compensatory tariff on the distribution companies. This may reduce the tariff and may benefit the end consumer.  

Source: SNP Infra Research