Coal crisis deepens: Factories face 12-hour power cuts, electricity costs surge
Coal-fired plants, which generate about two-thirds of India's electricity, are rapidly exhausting their fuel inventories
- Oct 13, 2026,
- Updated Oct 13, 2026 5:25 PM IST
Indian factories, steel mills and households are facing prolonged power cuts and rising electricity costs as coal stocks at power stations fall sharply, Bloomberg reported on Tuesday.
A weak monsoon has reduced hydropower generation, while unusually hot weather has increased electricity demand for air conditioning and agricultural irrigation.
Coal-fired plants, which generate about two-thirds of India's electricity, are rapidly exhausting their fuel inventories, the report said.
Small steel mills in Chhattisgarh are experiencing power cuts lasting 10 to 12 hours daily, forcing them to reduce production.
Manish Dhuppad, general secretary of the Chhattisgarh Mini Steel Plant Association, said steel manufacturing requires an uninterrupted electricity supply.
"Say we have hot metal inside the furnace and just before we are able to take it out, the power supply goes. By the time it comes back, the material has solidified and we need to melt it again," he told Bloomberg.
In Punjab, industrial units are also struggling.
Badish Jindal, who operates a steel wire factory in Ludhiana, said frequent three-to-four-hour outages have forced his business to rely on expensive backup generators.
"The power cuts are unscheduled," he said. "That makes it difficult to plan our operations and deliveries and affects product quality."
He warned that sudden machine stoppages and restarts also increase accident risks.
Coal stocks fall, prices jump
According to power ministry data cited by Bloomberg, coal inventories at nearly half of India's coal-fired power stations had fallen below 25% of required levels by October 10.
Heavy rainfall in eastern mining regions further disrupted coal production and railway transportation.
India's electricity grid recorded an average daily shortfall of nearly 4 gigawatts during October's first 10 days, according to Grid Controller of India data. Bloomberg estimated this was enough to power roughly two million rural households.
Coal India has prioritised supplies to grid-connected power stations, leaving industrial companies operating their own coal-fired plants struggling for fuel.
Rajiv Agarwal of the Indian Captive Power Producers Association said these businesses face higher auction prices, expensive grid electricity and months-long rail delays. Some have been forced to reduce output.
Coal India's September spot-auction premiums averaged 94% above base prices, compared with 59% in August. Northern Coalfields and South Eastern Coalfields charged premiums exceeding 200%.
Indian factories, steel mills and households are facing prolonged power cuts and rising electricity costs as coal stocks at power stations fall sharply, Bloomberg reported on Tuesday.
A weak monsoon has reduced hydropower generation, while unusually hot weather has increased electricity demand for air conditioning and agricultural irrigation.
Coal-fired plants, which generate about two-thirds of India's electricity, are rapidly exhausting their fuel inventories, the report said.
Small steel mills in Chhattisgarh are experiencing power cuts lasting 10 to 12 hours daily, forcing them to reduce production.
Manish Dhuppad, general secretary of the Chhattisgarh Mini Steel Plant Association, said steel manufacturing requires an uninterrupted electricity supply.
"Say we have hot metal inside the furnace and just before we are able to take it out, the power supply goes. By the time it comes back, the material has solidified and we need to melt it again," he told Bloomberg.
In Punjab, industrial units are also struggling.
Badish Jindal, who operates a steel wire factory in Ludhiana, said frequent three-to-four-hour outages have forced his business to rely on expensive backup generators.
"The power cuts are unscheduled," he said. "That makes it difficult to plan our operations and deliveries and affects product quality."
He warned that sudden machine stoppages and restarts also increase accident risks.
Coal stocks fall, prices jump
According to power ministry data cited by Bloomberg, coal inventories at nearly half of India's coal-fired power stations had fallen below 25% of required levels by October 10.
Heavy rainfall in eastern mining regions further disrupted coal production and railway transportation.
India's electricity grid recorded an average daily shortfall of nearly 4 gigawatts during October's first 10 days, according to Grid Controller of India data. Bloomberg estimated this was enough to power roughly two million rural households.
Coal India has prioritised supplies to grid-connected power stations, leaving industrial companies operating their own coal-fired plants struggling for fuel.
Rajiv Agarwal of the Indian Captive Power Producers Association said these businesses face higher auction prices, expensive grid electricity and months-long rail delays. Some have been forced to reduce output.
Coal India's September spot-auction premiums averaged 94% above base prices, compared with 59% in August. Northern Coalfields and South Eastern Coalfields charged premiums exceeding 200%.