Coal news and updates

Swapping of coal linkages may be allowed

August 12: The Standing Linkage Committee (Long-Term) or SLC (LT), at its meeting on August 11, discussed the matter related to swapping of coal linkages as requested by the Ministry of Power and appears to have indicated in its favour, official sources said.

The discussion on swapping of coal linkages was part of a policy under consideration that would allow swapping of coal between state and central power utilities.

A coal swapping policy is also under consideration following requests from Ministry of Power to bridge the gap between requirement and availability of coal and to minimise transportation costs.

Besides other issues, the meeting also reviewed pending Letters of Assurances (LoAs) issued to power projects for a total generation capacity of 78,000 MW.

A total of 177 LoAs were issued by the CIL and its subsidiaries for power projects to be commissioned during the 11th and 12th Plan. These LoAs cover a capacity of about 108,000 MW projects.

Out of these, CCEA had directed for coal supplies in respect of projects with 78,000 MW capacity and accordingly, a Presidential Directive was issued to CIL.

For these projects, FSAs were to be signed for 172 units covering 134 LoAs. Out of this 78,000 MW capacity, CIL had signed 160 FSAs for a capacity of 73,075 MW.

In the remaining 12 cases, some issues related to change of ownership, extension of coal supplies beyond the period admissible under the Tapering Linkage Policy, etc were involved.

The remaining 43 LoAs (177-134=43) were not covered within the 78,000 MW projects. Out of this, 24 projects with a capacity of 18,315 MW have already achieved their milestones and 2 LoAs have been cancelled while 7 LoAs are sub-judice due to various reasons.

These 9 LoAs were not discussed at the meeting but the remaining 10 pending cases where milestones documents were under verification and 2 cases where notice of cancellation had been issues were also reviewed at the meeting.