PSU Watch logo

| Cancel bids for hydrocarbon extraction in Cauvery Basin, Stalin urges PM Modi |   | LIC looks to raise up to Rs 25,000 crore from anchor investors |   | NTPC invites EoI for Hydrogen Fuel Cell based pilot projects |   | Oil Minister defends high fuel prices citing govt spending on welfare schemes |  

WCL slashes coal auction price of specific mines

To provide coal at cheaper price to its consumers, state-run WCL has decided to slash down its coal auction floor price by 10 percent
  • The reduced auction price will apply for coal of Mine Specific Source for all auctions to be conducted by WCL in April this year.
  • The lifting period of the booked coal at a cheaper price in both auctions to be held in April will be as per the existing policy and guidelines of the company.
Nagpur: In an effort to provide coal at cheaper price to its consumers as India reels under the COVID 19 pandemic, state-run WCL (Western Coalfields Ltd), a subsidiary of Coal India Ltd, has decided to slash down its coal auction floor price by 10 percent for specific mines. The reduced auction price will apply for coal of Mine Specific Source for all auctions to be conducted by WCL in April this year. This will help both power and non-power consumers to get coal at a reduced price.

Reduced coal auction price can be availed only in April: WCL

As a good gesture of providing relief to its consumers under the present lockdown, WCL has decided to reduce Special Forward and Spot e-auction floor price of 11 specific mines by 10 percent. Spot coal auction floor price will be 20 percent over the notified price, instead of present 30 percent and Special Forward floor price will be 8 percent over the notified price instead of the present 18 percent. This reduced price will be applicable for Special Forward and Spot Auction conducted during April only. Earlier floor price will continue from Auctions conducted from May 20 onwards. WCL is thus providing a window of one month to its consumers for getting coal at a cheaper price. The lifting period of the booked coal at a cheaper price in both auctions to be held in April will be as per the existing policy and guidelines of the company.

The 11 mines have been opened in the last 5 years

WCL had identified 11 out of its total 66 mines in November 2019 to be Mine Specific Source, especially for use by power plants at an additional add-on price of Rs 450 over the notified price. These 11 mines — eight greenfield mines, Dinesh, Makardhokra I. Gokul, Bhanegaon, Singhori, Penganga, Yekona, Pauni II, and three brownfield mines, Mungoli, Niljai, Gondegaon — were opened during the last five years to provide coal to power consumers of Central, Western and Southern India at their doorstep at a cheaper landed price. Earlier these power plants were getting coal from mines located in Eastern India, which was costly due to extra Railway freight. With the opening of new projects by WCL, coal became cheaper for these plants to the tune of Rs 1,000 per tonne on average. Under a policy, WCL requested power entities to share this gain by adding Rs 450 per tonne over the notified price for these 11 specific mines. No change in pricing was done for the remaining 55 mines. All linked power plants, including state gencos of Maharashtra, MP, Gujarat, Karnataka and other private power plants, are getting coal at specific add-on prices from these 11 mines. Coal from these specific mines are also auctioned under Special Forward e-auction for power consumers for those units who are either not linked to WCL or they need more coal in excess of their defined linkage quantity. Such auction is being done at a floor price 18 percent over the notified price. Similarly, left-over coal from these mines is also offered under Spot e-auction to non-power consumers at a floor price 30 percent over the notified price. For mines other than these specific mines, Special Forward e-auction is done at 25% percent over the notified price and 40 percent above the notified price in Spot e-auction.