Amid the growing restriction over the availability of coal in the country, the ministries of coal and power have arrived at a consensus to freeze the capacity and list of power projects linked to Coal India Ltd (CIL) companies.
The power ministry has identified projects of 127,448 Mw capacity that would need 557 million tonnes of coal for the signing of fuel supply agreements (FSA) with CIL and its subsidiaries.
Another 18,271 Mw, needing 122 mt of coal was commissioned between then and March 2012. The rest would be commissioned by 2014-15. The ministry has prepared a list of these projects, based on their preparedness, including placement of orders for machinery and equipment and start of construction.
A power ministry official, who did not want to be identified, said: “The Standing Linkage Committee (Long Term) for power, at its meeting held in February, discussed the issue of freezing capacity of power projects to be supplied by CIL during the 12th Plan. The committee was informed that the subsidiary companies of CIL had issued 172 letters of assurance (LoAs) for power projects, which excludes projects commissioned till March 31, 2009 and drawing coal from CIL and Singareni Collieries Company Ltd.
CIL indicated that coal companies will be able to supply 50 per cent of the normative requirement through indigenous sources and the balance through imports, if feasible.”
He added CIL had pointed out that its efforts to import coal to meet part of the requirement of power utilities had not met with the needed success due to non-availability of a firm commitment from power utilities to accept imported coal and unwillingness on the part of exporters of coal to offer long-term contracts.
“Therefore, the committee emphasised the need for freezing the capacity and list of power projects linked to CIL companies to plan the strategy for meeting coal requirement. This was necessitated in view of it being legally binding on the coal companies once FSAs are in place,” the official noted.
Further, the committee said it would not be possible for coal companies to plan additional commitment to the existing LoA holders who are not included in the list of 12th Plan projects agreed to be frozen by the power ministry and the Central Electricity Authority.
