The Centre is likely to approve a new coal linkage policy next week for ensuring adequate supply of the fuel to power plants through reverse auction route.
"The proposal on the scheme called 'SHAKTI' to provide coal linkages to power plants was listed on the agenda of the Cabinet meeting held yesterday. However, it could not be taken up due to paucity of time as the meeting was called on short notice," a source said.
The proposal would be taken up in the Cabinet meeting to be scheduled sometime next week, the source added.
The new coal linkage policy for power plants would help producers ensure fuel supplies in an organised manner.
The government's initiatives as well as international market conditions have helped bring down price of the dry fuel and boost domestic production. But a mechanism is required for providing coal linkages to power plants at competitive rates.
The source said the new fuel linkage policy would address this concern and put in place a proper mechanism for sourcing of dry fuel by the power plants as per their schedules.
Companies which do not have coal linkages at present, would benefit immensely from the new policy as they would get domestic fuel supplies at competitive rates through auction.
India has total installed generation capacity of about 314 GW, including 188GW coal-based thermal capacity, as on January 2017, the Central Electricity Authority (CEA) data showed.
CEA daily coal stock report on March 5, 2017, stated that only one plant of the 110 thermal plants monitored by it had supercritical coal stock. That means it had coal stock for less than four days.
There was only one plant which had critical coal stock situation which meant coal stock for less than seven days, the report said. Both these plants are non-pithead power stations.
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