GET Stock QuotesNews18 APP
News18 English

Madhya Pradesh

Rajasthan

Poll in 1 seat deferred

Chhattisgarh

Telangana

Mizoram

»
2-min read

Govt Orders Out of Turn Coal to PSUs; Pvt Plants to be Hit

The move to divert fuel from coal starved power projects would take a heavy toll on the already ailing sector, they said, adding the government continues to back PSUs at the cost of independent power producers in coal allocation.

PTI

Updated:May 25, 2018, 3:11 PM IST
facebookTwittergoogleskypewhatsapp
Govt Orders Out of Turn Coal to PSUs; Pvt Plants to be Hit
Representative Image. (Image: Reuters)
Loading...
New Delhi: In a jolt to private power producers, the government has ordered Coal India Ltd to make 'out-of-turn' allotment of scarce coal to central and state electricity generation companies.

The order follows a Coal Ministry directive earlier this month that instructed companies like Mahanadi Coalfields Ltd to deploy rakes of coal only for power plants and not other users like captive power plants of private industries.

In a May 24 letter to Coal India, the Coal Ministry said there may be an increased demand for coal due to a surge in demand during peak summer.

Power generation in April, it said, "has been more than the programmed generation and this, in turn, may lead to a more than anticipated increase in demand of coal from the power sector."

"In order to avoid possible shortage of coal at thermal power plants it has been decided that wherever it is operationally feasible based on various factors like coal stock availability, where suitable transport arrangements are in place etc, out of turn coal allotment may be made to state and central PSU (electricity) generation companies (Gencos) to meet the surged coal requirement for power generation," the ministry said in the letter, reviewed by PTI.

Industry sources said a coal shortage looms in India as demand for electricity is expected to hit record peaks during summer months. Also, Coal India Ltd has lagged in meeting surge in demand.
Out of turn allocation would have a direct bearing on coal allocation under the ambitious scheme named SHAKTI or the Scheme to Harness and Allocate Koyla (Coal) Transparently in India, as well as that done through e-auction. Under the SHAKTI scheme, fuel was to be allocated to power plants holding letters of assurance (LoAs).

Sources said coal allocation under these is under threat as Coal India has been failing to meet its production target and would not supply the scarce fuel to PSUs on priority.

The move to divert fuel from coal starved power projects would take a heavy toll on the already ailing sector, they said, adding the government continues to back PSUs at the cost of independent power producers in coal allocation.

Plant Load Factor or average capacity utilisation of state-owned NTPC plants is over 70 per cent while independent power producers (which are essentially private firms) are bleeding at 55 per cent PLF.

Coal Ministry has admitted to coal shortage even after making tall claims of rise in production, they said, adding it has now directed Coal India to supply fuel out of turn to PSUs to keep them running and prevent losses, all this at the cost of the private sector.
The move comes at a time when power producers are under tremendous stress and struggling to keep the projects afloat, they added.
(Get detailed and live results of each and every seat of the state Assemblies in Madhya Pradesh, Rajasthan, Telangana, Chhattisgarh and Mizoram to know which candidate/party is leading or trailing and to know who has won and who has lost and by what margin. Our one-of-its-kind Election Analytics Centre lets you put on the psephologist's hat. Know interesting facts and trivia about the elections. Elections = News18)
Read full article
Loading...
Next Story
Next Story

Also Watch

facebookTwittergoogleskypewhatsapp
Most Active
Company Price Change %Gain
Reliance 1,110.50 1.18
Yes Bank 186.60 4.92
Dr Reddys Labs 2,586.35 -4.78
ICICI Bank 349.95 2.09
Kotak Mahindra 1,237.15 1.51
Company Price Change %Gain
Yes Bank 186.80 5.30
Reliance 1,110.50 1.30
Axis Bank 619.35 2.50
TCS 2,018.70 1.02
Hero Motocorp 3,248.30 7.01
Top Gainers
Company Price Change %Gain
Hero Motocorp 3,258.65 7.23
Indiabulls Hsg 734.30 5.97
UPL 790.05 5.63
Bharti Airtel 305.55 5.27
Adani Ports 374.45 5.26
Company Price Change %Gain
Hero Motocorp 3,248.30 7.01
Bharti Airtel 309.50 6.69
Yes Bank 186.80 5.30
Adani Ports 374.40 4.90
Tata Steel 520.40 3.75

Live TV

Loading...
Countdown To Elections Results
  • 01 d
  • 12 h
  • 38 m
  • 09 s
To Assembly Elections 2018 Results