Coal news and updates

Coal auction to ensure gains reach power consumers

An inter-ministerial panel on Tuesday discussed the contours of the methodology for setting reserve price for coal block auction, with provisions to guard against unrealistic bids and ensuring that benefit of domestic coal is passed on to power consumers. The recommendations will be sent to the Cabinet for final vetting.

The need for a new methodology has arisen from the Supreme Court order cancelling allocation of 204 coal blocks made since 1993. Out of these, 37 are operating and another five are ready to go into production by April.

An inter-ministerial panel had in 2012 constituted an IMC to formulate a methodology for fixing floor/reserve price of coal blocks to be allotted through auction. Based on the recommendations of consultant Crisil, the previous panel proposed allotting blocks only to government companies or to power plants with tariff-based bidding so that the benefit of cheaper coal is passed on to consumers.

source: The Times of India