Coal news and updates

CIL modifies scope of grades for non-power consumers

September 10: The Coal India board has modified the decision in respect of the scope of supply of higher grades of domestic coal along with lower grades to the non-power consumers, while their FSAs are being renewed for a further five years.

In a notice dated August 14, 2013, WCL had informed its non-power consumers that, as per the CIL board's decision, all consumers whose FSAs are to be renewed may be offered 25% of the agreed quantity from higher grades of coal falling between G1 to G4, wherever available. In case of non-acceptance by the purchaser, such quantity shall be considered as "deemed delivered quantity".

"Supply of higher grades of coal, shall, however, be made after adjustment of the quantity on account of higher GCV of coal, assuming 1.5 ton of lower GCV coal is equivalent to one ton of high GCV coal, falling between G1-4. However, for CPP consumers, the quantity of higher grade coal offered may be adjusted on the basis of the consumption norms applicable to power sector consumers based on the GCV of the coal being offered from such higher grades," the notice further said.

The notice also stated that these decisions of the CIL board as well as the decision of the Functional Directors to distribute coal from cost-plus mines, shall be applicable to the FSAs to be renewed for August 2013.

However, on August 21, through another notice, WCL informed that, in partial modification of the decision taken at the 298th CIL board meeting, no quantity adjustment is to be made for supply of higher grades of coal, wherever available, to non-power consumers (including CPPs). Accordingly, relevant FSA provisions shall be modified.

Sources said, if CIL had not made the modification, consumers would have been disadvantaged since, according to them, at WCL "grades G1-G4 are not available".