Sunday, May 22, 2022

Will curtail availability of coal rakes to power plants found slacking in unloading coal: Govt

Must read

  • A number of power plants are taking much longer time than the prescribed norms in unloading coal from railway rakes which is affecting the turn-around time, said the govt
  • It has been decided that lesser number of rakes would be made available to such power plants where there is slackness in prompt unloading of coal from rakes, it added

New Delhi: In a stern directive issued on Saturday, the Ministry of Power has said that it will curtail the availability of coal rakes to power plants that have been found to be slacking in unloading coal from rakes. The ministry said that the delay in unloading of coal is affecting the turn-around time of coal rakes. “It has been reported that a number of power plants are taking much longer time than the prescribed norms in unloading coal from railway rakes which is affecting the turn-around time,” said the Ministry of Power in a statement.

“CEA (Central Electricity Authority) has been asked to monitor the unloading time at power plants and it has been decided that lesser number of rakes would be made available to such power plants where there is slackness in prompt unloading of coal from rakes. This step has been taken with the objective of maximising the utilisation of available railway rakes. Therefore, this aspect may be monitored at the level of state government and unloading of coal may be ensured within the given norms,” it added.

Coal to be allocated to all gencos on proportionate basis: Govt

The Ministry of Power has been monitoring the coal supply situation in the country and have been taking steps to ensure adequate coal supply and coal stocks based on the domestic coal received from Coal India Limited (CIL), Singareni Collieries Company Limited (SCCL) and captive coal mines.

As per the decision taken in the Ministry of Power in consultation with state gencos, IPPs and Central gencos, domestic coal supply to all gencos will be in proportion to the coal received from CIL/SCCL for all the gencos and it will not be possible to give more coal other than on proportionate basis to make up any shortfall, said the Power Ministry in the order. It added that coal production in captive coal mines allotted to power plants should be maximised to the limit permitted.

Gencos should clear dues of coal companies: Power Ministry

Pointing out that a number of power generating companies have overdues of coal companies running in several hundred crores of rupees, the ministry said, “Such huge overdue amounts affect the ability of coal companies to continue coal supply. Therefore, it is necessary that the bills of coal companies are paid in due time so that coal supplies to such generating companies are not affected on this account.”

Not maintaining coal stock inexcusable: Govt

It has been observed that non-operation of certain Imported Coal-Based (ICB) plants in states had put more pressure on domestic coal demand, leading to low coal stocks for domestic coal-based (DCB) plants. The procurers and sellers are legally bound by the Power Purchase Agreement (PPA) in force as signed by both the parties. “While the procurers are bound to pay the bills timely as per the PPA, the gencos (sellers) are bound to maintain adequate fuel stocks and offer availability as per the PPA. Not maintaining adequate fuel stocks or not giving availability on any pretext (such as high price of imported coal etc) is inexcusable,” said the Ministry of Power.

“Such a conduct on the part of seller should be immediately responded to by the procurer sternly by using all possible contractual and other available legal interventions at the level of state government. If any gaming is noticed on the part of seller such as not supplying electricity under the PPA and selling it in the market should be brought to the notice of the Regulatory Commission without any delay under intimation to Ministry of Power for immediate intervention (sic.),” said the government.

“However, it is understood that some of the ICB power plants are facing issues in the PPA due to change in Indonesian Regulations and increase in international coal prices. These issues also need to be resolved on the basis of mutual negotiations in a just and transparent manner,” it added.

Hence, states may ensure implementation of the PPA with ICB plants with necessary contractual interventions or in extraordinary circumstances, use statutory provisions of the Electricity Act, 2003 to ensure generation. They may also approach the Ministry of Power for any intervention required in case of inter-state plant, said the government.


The government has taken several initiatives to promote the use of renewable energy, thereby bringing down the dependence on coal for power generation in existing power plants. The Ministry of Power has been extending financial assistance to states for the separation of agriculture feeders and the same has been conveyed as one of the high priority items to be taken up in Revamped Distribution Sector Scheme (RDSS). States are also being advised to take up solarisation of such feeders under PM-KUSUM scheme. 

The Ministry of Power has also issued the guidelines for cofiring of Biomass pellets in coal-based power plants upto the extent of five to seven percent. 

The government has also formulated a scheme for bundling of renewable energy-based electricity with coal-based generation by generating companies under existing PPAs. This will not only lead to reduced dependence on coal but also lead to cheaper electricity because the scheme envisages that the benefit of lower power cost be shared with the PPA holder distribution companies. The Central sector generating companies such as NTPC and DVC have been directed to implement this scheme on priority. It is, therefore, imperative that the distribution companies should facilitate implementation of this initiative.

In view of the increasing demand for electricity and associated need for coal to ensure smooth functioning, as a short term measure, the Ministry of Power on December 7, 2021 had issued advisories to domestic coal-based power plants to import coal to meet their requirements by blending with imported coal to the extent of 4 percent by state gencos and Independent Power Producers (IPPs).

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Google News. Click here to follow. Also, join PSU Watch Channel in your Telegram. You may also follow us on Twitter here and stay updated.)

- Advertisement -

More articles

- Advertisement -

Latest News