The world's largest coal company is feeling the pressure of solar energy prices falling, and they will need to scale back in order to limit their losses. Coal India has announced that they will be closing 37 coal mines in the next nine months. It’s another big blow that continues the downward trend of the coal industry.
The Telegraph India that in a company review, nine percent of their mines, all underground, would not be able to turn a big enough profit to pay the salaries of their workers. They’ve been declared economically nonviable and informed the Bombay Stock Exchange of their decision. By closing these mines down, the company will save around $124 million USD.
Underground mining has been targeted due to how expensive it is to produce coal. It’s a popular method as they’re able to retrieve higher-ranked coal, and these kinds of mines accounted for over 50 percent of all mines under the Coal India umbrella. With 37 of them closing down, there would be more open cast mines in India in March 2018.
Higher-ranked coal has a higher percentage of carbon and are less volatile, meaning they’re more efficient. The United States commonly uses a middle-rank coal called bituminous. The highest rank of coal, anthracite, can be found in these underground mines.
The company produces 82 percent of the country’s coal and over 192 gigawatts of energy are still powered from coal-fired power plants. However, it would make more economical sense to switch over to renewable energy in places that will be seeing their mines shut down. Costs of adding solar energy became cheaper back in May, and it’s really kicked off this big shakeup.
India opened up the ability for private companies to commercially sell coal back in March 2015. The move was to take away the monopoly Coal India has on the industry and to help out miners. By 2020, India will be producing more coal than the United States, but their future looks bleak once coal mining restrictions go into effect in 2022. By then, sustainable alternatives could be even cheaper.