Coal news and updates

Failure to lift coal by Mahagenco hit consumers: CAG

Mahagenco has been under fire of late from consumer activists for not lifting its share of coal from coal companies especially Western Coalfields Limited (WCL). Now a report by Comptroller and Auditor General (CAG) has confirmed that this led to loss of generation and consequently power shortage.

Genco complained that it was supplied only 65% of the promised quantity in 2012-13. The activists have however, pointed out that many states have lifted more than their share. "Gujarat has lifted 87% more than its share. Clearly the problem lies with Mahagenco. WCL is not its enemy," said RB Goenka, energy cell chairman of Vidarbha Industries Association (VIA).

The activists also claim that Mahagenco was deliberately not lifting its share of domestic coal to import increased quantity of coal. The quantity was 13.21 lakh tons in 2008-09, which increased to 30.63 lakh tons in 2012-13. Even though imported coal has a higher calorific value its cost is about thrice of WCL coal, which makes it uneconomical.

Mahagenco has put the entire blame on coal companies for not providing promised quantity of coal. The CAG report however, blames the company too. Genco faced coal shortage from April to June 2009 due to delay in execution with coal companies. This happened because of lack of coordination between the two parties. During this period the state had to face prolonged power cuts and MSEDCL had said that coal shortage was one of the reasons.

CAG report points out an interesting fact. There was no loss in generation due to coal shortage in 2005-06, 2006-07 and 2007-08. However, the loss in generation in 2008-09 and 2009-10 was over 1,200 million units (MUs). The company suffered a loss of Rs 295 crore due to this shortfall. The quantity of shortfall was in the same range every year.

Mahagenco first decided to get coal washed by private operators with much fanfare. However, there were several allegations that the coal was being sold by the operators in open market and Mahagenco terminated the contract in July 2011. The company was unable to lift its share of coal as it did not have means for getting it transported by road.

The decision not to use washed coal initially benefited Mahagenco. The plant load factor (PLF), the parameter of generation efficiency of a power plant, improved significantly between July 2011 and April 2012. In July 2011, PLF was 52.28%, in October 2011 it was 58.69%, in December 2011 it increased to 71.78% and in April 2012 it was at 74.37%. This shows that PLF increased after Genco stopped using washed coal.

However, the same holds true for imported coal. Even as increasing amount of imported coal is being used the PLF continues to go down and came down below 50%.

Govt slammed for reneging on its promise

Consumer activist Pratap Hogade has slammed the government for reneging on its promise made during winter session. A press release issued by Maharashtra Rajya Veej Grahak Sangathana (MRVGS) stated that Chief Minister Prithviraj Chavan and industries minister Narayan Rane had promised that measures to power tariff would be announced soon after the conclusion of session. However, the government has become silent on this issue.

Hogade alleged that due to rift between Congress and NCP the government was not able to take a concrete decision and farmers and power loom owners were suffering. He warned that the two parties would have to pay a price for their insensitivity.

Source: The Times of India