Power cos may buy coal from sources other than CIL: Govt

 

Agencies: New Delhi, Nov 29 2012, 21:27 IST

 

New Delhi: Power companies may secure coal from alternative sources in the absence of sufficient supply of the fuel from state-run Coal India, Parliament was informed today.

 

"As per the new coal distribution policy of Ministry of Coal, in order to meet the domestic requirement of coal, Coal India may have to import coal as may be required from time to time," Power Minister Jyotiraditya Scindia said in a written reply in the Lok Sabha.

 

He added that developers may also obtain fuel from alternative sources in case of any shortage of assured supply of coal from Coal India.

 

Earlier this week Coal Ministry had said that Coal India had written letters to power companies seeking their consent for supply of imported coal on cost plus basis under the modified Fuel Supply Agreement (FSA).

 

Cost-plus basis means cost of importing coal by Coal India plus additional charges.

Meanwhile, 30 power plants have entered into pacts with the coal behemoth.

 

The state-owned firm is likely to enter into pacts with 48 power units.

 

Power companies waiting to sign the FSA with CIL would have to arrange for 17 per cent of coal on their own either through import or e-auction to run their plants at 85 per cent plant load factor.

 

CIL proposes to use MMTC or State Trading Company to import coal.

 

The Centre provides 90 per cent of the project cost as capital subsidy for establishing Rural Electricity Distribution Backbone (REDB) and Village Electrification Infrastructure (VEI) and provides free electricity single point connection to BPL households under RGGVY.

 

Scindia said the responsibility of implementing the scheme is with the state governments but several members, including some from the Treasury Benches, objected.

 

He stated that in 70-80 per cent of the cases the state electricity boards are implementing it.

 

"A monitoring matrix is being formed at the district level," Scindia said and accepted suggestion from Opposition benches that the local MP should be involved in this.

 

Source: Financial Express