India Orders Captive Coal Plants to Maximise Output from October 1

India’s federal power ministry issued a directive on 25 September 2026 for more than 100 captive coal-fired power plants to maximise generation from 1 October to 31 December 2026. The order applies to captive plants with an installed capacity of at least 50 megawatts and uses emergency powers under Section 11 of the Electricity Act.

Captive Power Plants

Captive power plants are electricity-generating units set up mainly for the use of the owner or an associated industrial facility. In India, such plants are used by aluminium smelters, steelmakers, cement factories, oil refineries, and other large industrial consumers.

Section 11 of the Electricity Act

Section 11 of the Electricity Act allows the government to direct generating companies to operate and maintain stations in extraordinary situations. This provision is used for emergency measures related to public interest, grid stability, or supply shortages.

Operational Requirements and Fuel Context

Affected generators must sell surplus electricity through power exchanges and submit weekly reports on generation, consumption, sales, capacity, and coal stocks to the Central Electricity Authority. As of 19 September 2026, nearly 40% of India’s coal-fired power plants had critically low fuel stocks, and some plants had less than three days of coal.

Important Facts for Exams

• Captive power plants are designed primarily for self-use by industrial units rather than for the open market.
• Power exchanges in India provide a platform for short-term electricity trading.
• The Central Electricity Authority is a statutory body under the Ministry of Power.
• Coal-fired power plants remain a major source of baseload electricity in India’s power mix.

Demand Drivers and Fuel Policy

The directive was linked to an expected rise in electricity demand, hotter-than-usual weather associated with El Niño, and higher irrigation needs. India is also considering a separate mandate for thermal power plants to blend up to 5% imported coal with domestic coal supplies.