The world’s biggest coal miner has dominated India’s power market since it was created in the nationalization wave of the 1970s. As Coal India Ltd.’s woes pile up during a dismal summer for producers, that may be changing.

Extreme heat is most often bad news in India, and milder temperatures spell relief for millions of people — unless, of course, you’re in the power business. This year’s balmy summer has hit the country’s appetite to splurge on coolers and air conditioners.

Demand dropped in the quarter through June compared with the previous year — a rarity.

Early rains and cooler temperatures upended Coal India’s plans to offload unsold inventories. Instead, muted demand left power stations with near-record reserves of the fuel, causing an almost 5% sales decline for the company during the three months to June.

Bloated stockpiles and sagging sales forced production cuts in five of the first six months this year.

Gluts are everywhere this summer. Chinese thermal-coal producers are also struggling with oversupply after authorities expanded production to avoid blackouts. Benchmark Newcastle coal isn’t far from four-year lows.

But India’s heavyweight has bigger headaches.

First, in the shape of reforms that increased competition and allowed large users, such as NTPC Ltd., to accelerate production at their own mines — and potentially begin reducing purchases from Coal India.

Then, there’s the unstoppable expansion of clean power, which continues apace even as India stops short of signaling an end to coal. In the two months ending in May, coal power output dropped 6% while renewables generation grew 23%.

Coal India itself has seen the writing on the wall — both for the company and the fuel.

It’s moving to list multiple subsidiaries to raise cash, in part to diversify into new areas, including critical minerals mining and renewable energy. That’s a mammoth challenge at a time when there’s ample competition.

Back in 2021, then-Chairman Pramod Agrawal said during the depths of the pandemic that the company couldn’t survive for long merely as a coal miner.

The words ring true. And the challenge of reinvention, for all producers, is just as big.

--Rajesh Kumar Singh, Bloomberg News