Ministry seeks feedback on coal gasification scheme by March 20

New Delhi: Ministry of Coal on Wednesday said it has sought feedback from interested government as well as private entities for establishment of coal gasification plants in the country.

The Ministry said it has issued three draft request for proposals (RFPs) for consultation on coal gasification scheme.

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"Issued three draft RFPs to solicit feedback from interested government PSUs and private investors for the establishment of coal gasification plants in India," it said in a statement.

The stakeholders can provide their feedback and suggestions until March 20, it said.

The Union Cabinet had earlier approved allocation of Rs 8,500 crore for incentives towards coal gasification projects, having three categories.

Draft RFPs have been issued separately for each of the three categories.

Category I of the scheme allocates Rs 4,050 crore to the PSUs to support up to 3 projects, offering a lump-sum grant of Rs 1,350 crore or 15 percent of the capital expenditure, whichever is lower.

In Category II, Rs 3,850 crore is earmarked for both the private sector and PSUs, providing each project with a lump-sum grant of Rs 1,000 crore or 15 percent of the capital expenditure.

Additionally, at least one project in this category will undergo a tariff-based bidding process.

Category III includes Rs 600 crore for demonstration projects and small-scale gasification plants, offering a lump-sum grant of Rs 100 crore or 15 percent of the capital expenditure to entities with a minimum capex of Rs 100 crore and minimum production of 1,500 normal meter cubed per hour of synthesis gas (syngas).

In a separate statement, the ministry said coal plays a pivotal role in India's energy system, accounting for nearly 70 percent of the total electric generation.

It is also a critical input in various industries such as steel, sponge iron, cement, and paper, the ministry said adding various measures have been taken to promote usage of clean technology in the coal sector.

The National Coal Gasification Mission aims to gasify 100 million tonne of coal by 2030 through surface coal/lignite gasification projects.

The government has also approved the equity investment proposal by Coal India Ltd in JVs of CIL-GAIL and CIL-BHEL.

The joint venture (JV) agreement has been formally signed between CIL and Bharat Heavy Electricals Limited for setting up an ammonium nitrate plant through surface coal gasification (SCG).

The government is also actively engaged in clean coal initiatives such as extraction of coal bed methane (CBM) gases, exploring Coal to Hydrogen, Carbon Capture and Storage (CCS), coal beneficiation through washeries, etc. to mitigate emissions and enhance environmental sustainability.

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