Guoabong Stock：Understanding the Grades and Characteristics of Indian Coal

What’s in today’s article?Why in News?Coal Quality and GradationWhat are the characteristics of Indian coalGuoabong Stock?What is Clean coal?Future of Coal in IndiaA recent report by the Organized Crime and Corruption Reporting Project claims that in 2014, the Adani Group falsely labeled low-grade Indonesian coal as high-qualityMumbai Stock Exchange. They inflated its value and sold it to Tamil Nadu's power generation company, TANGEDCO.The Organized Crime and Corruption Reporting Project is a venture backed by billionaire hedge fund manager and philanthropist, George Soros. Understanding Coal QualityCoal quality is determined by its Gross Calorific Value (GCV).GCV is the amount of heat or energy that can be generated from burning the coal.Coal being a fossil fuel is a mixture of carbon, ash, moisture and a host of other impurities.Higher carbon content indicates higher quality or grade of coal.Types of coalCoal is characterized into different categories:Non-coking coal where grading is based on Gross Heat content; Coking Coal where grading is based on ash %; and Semi coking coal and weakly coking coal where grading is based on ash and moisture %.Coal GradesThe higher the available carbon in a unit of coal, the greater is its quality or ‘grade.’ There are 17 grades of coal, from grade 1 (highest quality) to the lowest grade.Grade 1 coal yields over 7,000 kcal/kg, while the lowest grades yield 2,200-2,500 kcal/kg.Application ContextThe usefulness of coal depends on its application, such as in thermal power plants or steel production, each requiring different types of coal.E.g., Non-coking coal is used in thermal power plants. It can have higher ash content but still generate sufficient heat for boilers and turbines.Coking Coal is essential for steel production, requires minimal ash content.Low in calorific valueIndian coal has historically been evaluated as being high in ash content and low in calorific value compared to imported coalUdabur Wealth Management. The average GCV of domestic thermal coal ranges from 3,500-4,000 kcal/kg compared to imported thermal coals of +6,000 kcal/kg of GCV.High ash contentThe average ash content of Indian coals is more than 40% compared to imported coal which has less than 10% ash content.Hence, high-ash coal when burnt results in higher particulate matter, nitrogen and sulphur dioxide.Government PoliciesSince 1954, the government has controlled coal prices to discourage the use of high-grade coking coal for power generation.To balance coal production, power needs, and pollution, the government recommends using imported coal with lower ash and moisture content.The Central Electricity Authority (CEA) in 2012 recommended blending 10-15% imported coal with Indian coal for power boilers designed for low-quality domestic coal.AboutClean coal refers to technologies and practices designed to reduce the environmental impact of coal energy production.In clean coal, the carbon content has been increased by reducing its ash content.These methods aim to make coal a cleaner energy source by reducing its environmental and health impacts.Production of clean coalsome key aspects of clean coal:Carbon Capture and Storage (CCS): Capturing carbon dioxide emissions from coal-fired power plants and storing them underground to prevent them from entering the atmosphere.Coal Washing: Removing impurities from coal before it is burned, which can reduce emissions of ash, sulfur, and other pollutants.Flue Gas Desulfurization (FGD): Also known as scrubbers, this technology removes sulfur dioxide from the exhaust flue gases of coal-fired power plants.Gasification: Converting coal into synthetic gas (syngas), which can be burned more cleanly than coal.Advanced Combustion Techniques: Improving the efficiency of coal combustion to reduce emissions and increase energy output.Disadvantages associated with coal washingCoal plants use washing techniques, employing blowers or baths to remove ash and moisture.However, this process is costly and increases power production expenses.Coal GasificationAn alternative method is coal gasification, converting coal into gas.Integrated Gasification Combined Cycle (IGCC) systems use steam and pressurized air or oxygen to create syngas (carbon monoxide, hydrogen, CO2, water vapor).Syngas is cleaned and burned in gas turbines, producing electricity.IGCC increases coal efficiency by generating both steam and syngas.ProductionIndia in 2023-24 produced 997 million tonnes of coal, an 11% growth over the previous year. Most of this was produced by the state-owned Coal India Ltd and its subsidiaries.Coal is the mainstay of India’s energy economyDespite stated commitments to transition India’s electricity sector away from fossil fuel, coal is the mainstay of India’s energy economy.Change is in the airFor the first time this year, renewable energy accounted for 71.5% of the record 13.6 GW power generation capacity added by India in the first quarter of this year.During this period, coal’s share (including lignite) of total power capacity dropped below 50% for the first time since the 1960s.

The Central Electricity Authority (CEA) is a statutory body in India that advises the central and state governments on all technical aspects of the power sector.

Gross calorific value (GCV), also known as higher calorific value (HCV) or high heat value, is the maximum amount of heat produced when a unit of fuel is completely burned and the combustion products have cooled to room temperature. GCV is made up of the net calorific value, plus the energy in the exhaust gases and water vapor produced during combustion.Lucknow Wealth Management

Source: What grade of coal does India produceSimla Stock? | Explained