Coal supplies to India's power sector have shown significant improvement, with daily supplies increasing by around 36% from the September low. According to the Coal Ministry, stock depletion has slowed sharply, with the daily drawdown falling by more than half from 0.243 MT per day in September to 0.116 MT per day in October. The ministry stated that the position is therefore stabilizing, although stock rebuilding is yet to commence. Rail loading has strengthened correspondingly, averaging over 465 rakes per day in October, with the 470-rake target achieved on three consecutive days. Supplies through other modes, including road, have also improved, indicating a comprehensive recovery in coal supply chains. The government expects sustained rail loading of 465-475 rakes per day to support further stabilization and enable stock rebuilding ahead of the festive, winter and subsequent summer demand periods.
State-run NTPC is stepping up sourcing from commercial mines as the coal crisis in India's power sector shows signs of stabilization. The company plans to procure 10 million tonnes (MT) of coal from commercial mines in the remaining six months of FY27, marking the first time NTPC is looking to source coal at this scale from commercial mines. According to government officials, coal from commercial coal mines has started coming in from October, with NTPC targeting around 10 MT from commercial mines during the remaining six months of FY27. Going forward, this trend is expected to continue, with around 10-15 MT of coal likely to come from commercial mines every year for the company. The move comes as coal inventories at NTPC's power plants remain well below prescribed levels, with the company's standalone fleet having 4.58 MT of coal stock as of October 5, against a normative requirement of 12.83 MT, with stocks at just 36% of the prescribed level.
NTPC plants are currently running at a plant load factor of 76%, with the company reporting 13% year-on-year growth in power generation to 117.9 billion units in July-September 2026, compared to 104.4 BUs a year earlier. On a year-to-date basis, NTPC's power generation has grown by 9.5% year-on-year. The company has placed orders for the commercial coal procurement, with delivery expected to start soon, according to sources.
Official data shows that as of October 5, 47% of the plants based on domestic and imported coal out of the 191 plants with capacity of about 225 GW are facing critical coal inventories. These plants have coal stock of 20.58 MT against a daily requirement of 3.14 MT, with plants falling under the critical category if their coal stock is less than 25% of the usual quantity. The daily coal stock requirement is calculated at 85% of the plant load factor (PLF) or capacity utilisation. Government data as of October 5 showed total coal stocks at domestic-coal-based power plants at 18.15 MT, against a normative requirement of 57.23 MT, with the stock lasting about six and a half days at the previous day's consumption rate. Of the 176 domestic-coal-based plants, 81 were classified as critical, meaning their stocks were below 25% of the prescribed requirement. The ministry clarified that the critical stock tag is a norm-based trigger and designed to flag plants early, well before actual fuel shortage or generation loss occurs.
Power demand has increased in recent days amid rising temperatures, with the peak demand power on 5 October reaching 260.73 GW. The supply shortage stems from higher coal burn due to a decline in hydro power generation and rise in electricity demand in the evening and night hours, which can be attributed to the El Niño effect. High power demand and subsequent shortages stemmed largely from a weak southwest monsoon this year, with seasonal rainfall standing at 87% of the long-period average. This drove September's national average maximum temperature to 32.05°C and minimum to 23.39°C—ranking as the sixth highest for both metrics since 1901. Rainfall hampered coal mining and transport, constraining thermal generation, while below-normal precipitation weighed on hydropower output, which fell roughly 10% below 2025 levels.
NTPC traditionally sources the bulk of its coal through established supply arrangements with Coal India Ltd (CIL) and its subsidiaries, with its annual requirement at around 280 MT. The company first bought around 2.9 MT from commercial mines in 2024 and made no such purchases in 2025. Eventually, NTPC plans to step up sourcing from captive and commercial mines, which together are expected to account for around 70 MT, or roughly a quarter of its annual coal requirement. The broader sourcing strategy envisages meeting around 25% of its coal requirement from captive mines and another 8-10% from commercial coal mines, with the balance continuing to come through existing supply arrangements. As an alternative to mandating imported coal blending, the government has for the first time asked captive power plants to offer their surplus electricity in the power market.
