Petcoke Ban in India on the Cards

The Ministry of Environment, Forest and Climate Change in the Government of India is in the advanced stages of finalizing a regulation to impose a ban on Petcoke usage in the Delhi/NCR due to its polluting effects. Petcoke market in India is on the verge of a changeover, with a ban on its use by the non-cement sectors in the Delhi/NCR on the cards.

The concern for banning use of the fuel came to the fore when the Delhi-based Environmental Pollution Control and Prevention Authority (EPCPA) urged the Supreme Court on Dec’16 to impose a ban in view of the severe pollution caused by its extensive use.

Elaborating the nature of pollution unleashed by use of Petcoke, the EPCPA had apprised to the court that the Sulphur constituent in Petcoke is responsible for causing pollution. Samples studied by EPCPA in Delhi/NCR contained high levels of Sulphur in the range of 69,000 ppm to 74,000 ppm -that had been causing severe pollution in the environment.

In response to the appeal by the EPCPA, the Supreme Court in Feb’17 had directed the Central Government to impose a ban on usage of the fuel in the Delhi/NCR.Subsequently, the matter was put to consideration by the Ministry of Environment, Forests and Climate Change, which is likely to act in the affirmative to the court’s directive.

This is not the first instance of environmental concerns being voiced over Petcoke usage. In May’16, the National Green Tribunal (NGT) had appealed to the Central Government to assess the environmental impacts of Petcoke and formulate remedial measures. The appeal was made after a social activist solicited the NGT to take measures to counter environmental pollution caused by the widespread use of Petcoke by various industries. The social activist appraised that burning Petcoke emits Sulphur to the atmosphere,and that is harmful for human health.

The ban, if imposed, will force all Petcoke user-industries such as textile, chemical, paper, boiler to switch over to using coal. However, the cement industry will be excluded from the ban as the plants are equipped with mechanisms to counter Sulphur emission to the atmosphere. The ministry is also mulling over imposing a pan- India ban subsequent to the initial ban in the Delhi/NCR.

The pertinent question is: what will be the overall impact of the ban?

Consumption of Non-coking coal will increase, and at the same time, Petcoke imports will decrease. Sales of Indian refineries will also decline as it will be catering to only one consumer – the cement industry in the country.

Petcoke, nevertheless, is an efficient fuel which is superior to coal in terms of higher calorific value as well as lower cost that contributes decisively towards raising profitability of user-industries.
The gross calorific value of Petcoke normally lies in between 8,000-8,200 kilo cal/kg, whereas that of coal varies within 6,000-6,200 kilo cal/kg.Petcoke prices are also generally lower than coal.

India is the second largest Petcoke consuming country after China, in Asia. In addition to the cement industry, a slew of industries like textile, chemical, paper, boiler etc use Petcoke as fuel.

Going by the regular consumption trend in the country, demand for Petcoke could be expected to reach around 30 mnt by FY22. Domestic supply is expected to decline substantially in the future, after Reliance Industries Limited commissions its gasification project, tentatively in FY18. After the project going on-stream, around 6.5 mnt of the company’s own Petcoke production will be used to produce Syngas.

 

Coming to the rationale behind the possible ban – the polluting effect; this could also be lowered by allowing use of Petcoke with low Sulphur content by the non-cement sectors. The Sulphur constituent is the main polluting agent in Petcoke. Indian and American refineries produce low Sulphur Petcoke, but Saudi Arabian refineries produce high Sulphur Petcoke, which could be banned from importing due to the polluting nature. On the financial side,use of Petcoke improves margins of the consuming companies.

Source: Steel 360 Magazine Apr’17 Issue