Centre asks NTPC to import coal for Simhadri plant

Coal imports to start from january 2005

Keeping in view the acute coal shortage in the country, the Union government has asked the National Thermal Power Corporation (NTPC) to import coal for its 1,000 mega watt Simhadri Thermal Power Station near Vizag, besides the Raichur plant in Karnataka.

The Centre is also learnt to have indicated the same to the Tamil Nadu State Electricity Board (TNEB) on the utility's coal requirement. The idea to meet the coal requirements of the above thermal plants through imports is obviously driven by their proximity to the port facilities.

According to the highly placed sources, the above decision was taken on Sunday at a high level meeting chaired by Prime Minister Manmohan Singh on the coal supply position in New Delhi. Sources said the coal imports are expected to commence from January 2005.

The Mahanadi Coal Fields Limited (MCL) in Orissa is currently feeding NTPC's Vizag thermal power project, which requires about five million tonnes of coal per annum.

When contacted on the Centre's decision on coal imports for the Simhadri project, the NTPC officials in Hyderabad said that they were yet to receive any communication in this regard.

The decision with regard to Simhadri power project has direct implications on the state, as the power generated by this project is exclusively meant for the Andhra Pradesh grid. Any increase in coal cost will have to be borne by APTransco, which in-turn transfers it to the consumers through Fuel Surcharge Adjustment (FSA) mechanism.

Though MCL produces over 60 million tonnes of coal annually, it still has a short supply of over six to 10 million tonnes, sources say. With power generation being the priority activity, Coal India Limited (CIL) is ensuring coal supplies to the thermal plants with great difficulty. Coal stocks at several thermal stations are poorly maintained on account of the coal shortage.