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Coal India, the world’s largest coal producer, has reopened more than 30 mines and is launching five more on the Greenfield site this year.
“Sometimes, by the time the renewable energy and battery storage systems become bigger, better and more efficient, the share of coal can fall,” Prime Minister Prasad, chairman of State-owned Coal India, told the Financial Times in an interview.
Prasad said it has reopened 32 invalid coal mines on a revenue-sharing basis with privately owned local partners, with a half dozen expected to start production in fiscal year 2025-26.
Mines were previously closed as they were uneconomical because of their reliance on “manual mining” and “small machines.” In December, Indian coal mines announced plans to bring closed mines back online, increase production and reduce imports.
“This is happening now,” Prasad said. The government has already awarded 27 bids for such mines this year, with the remaining five being “in the pipeline” and soon to be granted.
Most demand for coal in the world’s fifth largest economy is met by local production, primarily by Indian coal. The company operates 310 mines nationwide, providing about a quarter of the national coal demand.
Despite large investments in solar and wind farms by local conglomerates such as the Tata Group, India still relies on coal for 74% of its generation. The shared government will fall to 55% by 2030 and 27% by 2047.
According to Energy Think-Tank Ember, India’s investment in renewable energy was over $13 billion last year, with over $68 billion per year falling well below $68 billion per year to achieve its target of producing 500 gigawatts of electricity from green sources by 2030.
Prasad said state-owned miners are sticking to Prime Minister Narendra Modi’s commitment to the country to reach net-zero carbon emissions within 50 years.
Prime Minister Prasad says India will reach peak coal by 2035 ©Coal India
“We’ll reach peak coal by 2035, then flattened, then descended by 2047 and phased out by 2070,” he said, explaining that even then, small amounts of coal production is still needed.
India owns the fifth largest coal reserve in the world, and the government says fuel is “still important.”
The world’s fastest growing major economy, the country resists international pressure to move faster to reduce the use of polluted fossil fuels. India is focused on trying to become a manufacturing hub.
In March, Mines Minister G Kishan Reddy said India “achieved a historic milestone” by producing more than 1 billion tonnes of coal in 2024-25, with output rising 5% compared to the previous year.
Prasad predicts that by 2029, Cole India alone will surpass its output, after producing 781 million tonnes last year. The government expects national coal production to increase by 6-7% per year to 1.5 billion tonnes by 2030.
The energy needs of the 1.4 billion country are “very high due to growing aspirations,” and efforts are very high to link more homes to the electric grid,” said the coal India chair. To meet such demand, the company was preparing to open up to five new Opensust mines on the Greenfield site, he said.
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Coal India produces most of the coal from Opencast mines, which are more contaminated than underground mining, but Prasad claimed it was mined “in a sustainable way.” Prior to 2070, the company is investing in solar and wind energy projects to diversify away from coal.
India opened commercial coal mines in the private sector only in 2018, and was opened in the private sector only with private conglomerates that currently own and operate mines, but own and operate them on a smaller scale compared to Indian coal.
“India will need to mine coal for the next few decades, and coal India is the only company that can do this on a large scale,” said Rohit Chandra, a coal expert at Indian Institute of Technology.
