Mineral-energy-international.com, Despite growing beliefs that renewable energy will dominate power generation in Asia, particularly India, coal is expected to remain a primary fuel source for the next two decades. Vuslat Bayoglu, managing director of South African mining firm Menar, highlighted that the substantial investments needed to build renewable energy capacity and the intermittent nature of such sources will hinder their dominance.
“The rapid population growth in India is driving unprecedented energy demands, necessitating that coal remains a cornerstone of energy supply for years to come, even as renewables expand,” Bayoglu stated. He emphasized that baseload power must not be overlooked, asserting that coal will continue to fulfill this role, as reliability and consistent supply are essential—qualities that renewables often struggle to provide in countries like India.
Bayoglu noted that transitioning to renewables carries different implications in the Asian context. “While it’s essential, this transition should not come at the expense of meeting basic energy needs for the population,” he remarked, emphasizing the importance of affordability in implementing renewable energy solutions.
He also pointed out that existing investments in coal cannot be disregarded without achieving a reasonable return, particularly as many coal-fired plants across Asia are newly constructed and still have significant operational lifespans ahead.
There should be discussions about how to reduce emissions from both coal-based power and non-power sectors, as they are crucial for ensuring energy supply in the years to come
Menar sees India as playing an increasingly significant role in shaping global energy commodities pricing and demand, especially for coal. The company’s coal production capacity is approximately 7 million metric tons per year through its subsidiaries and investments.
“A growing India is advantageous for the entire world, as demand centers will shape the global trade narrative, particularly in light of prevalent geopolitical risks. In the coming years, India is likely to compete more vigorously with China for trade dominance,” Bayoglu stated.
While India’s crude oil import expenses decreased in the fiscal year 2023-24 due to lower international prices, the country’s dependency on imports surged to over 87.7%, according to data from the Petroleum Planning and Analysis Cell (PPAC). This increase is driven by population growth, rapid economic expansion, and infrastructure development. Coal imports also reached a record high of over 260 million metric tons last fiscal year, accounting for more than 25% of total consumption and gradually closing the gap with China’s coal imports, which exceeded 450 million metric tons last year.
Although South African coal is favored in markets such as India, Pakistan, parts of Europe, and China, domestic transportation issues with the state-owned freight operator Transnet, frequent rail disruptions, and theft have collectively led to supply-chain inefficiencies, resulting in underutilized export potential.
Bayoglu remains optimistic, stating that the government and relevant stakeholders are implementing plans to address logistical challenges by increasing train numbers, enhancing line efficiency, and improving security.
“Logistics issues exist in every country, and while South Africa has been particularly affected, I see positive changes underway. In about two to three years, we should overcome many of these transportation challenges and increase our export capacity,” he concluded.