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Key Coal India pricing system delayed till June

The PSU mining giant was supposed to implement a billing policy from April 1

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A new way of charging for coal, beneficial to customers, including power plants, may not get implemented before June as Coal India struggles to get its systems in place.

The PSU mining giant was supposed to implement a billing policy from April 1, in line with global standards, where in it would charge customers for exact units of energy consumed and do away with the prices for grades of coal at present. While a pre-launch workshop was conducted by Coal India, industry representatives, who attended the meeting, said the proposed system was largely supported.

“The implementation of pricing based on energy consumption was likely to start either by end-May or early-June but Coal India subsidiaries are not quite ready with the infrastructure to launch it,” sources told DNA Money.

Almost all of Coal India’s actual mining is carried out by most of its subsidiaries while supplies and sales are handled by Coal India, the holding company.

Charging customers for the actual amount of heat expected to get generated by burning the coal would change the way Coal India books its revenues and the way power generating companies like NTPC and others pay for the coal, which, in turn, determines what people pay for their electricity bills.

But power plants would have to wait for a bit more time to reap benefits of the new pricing system.

“Coal India is working out the modalities to raise coal sales bills on gross calorific value (GCV) or kilo calorie per kg basis and the exact date of implementation would be intimated soon. Till then, the present mode of raising of coal sales bills would continue,” Coal India official said.

“At the meeting between Coal India officials and consumers on March 26, we were told that the new system would get operational from April 1. There was also not much opposition and most of the representatives who attended welcomed it. So, the decision to defer it was bit of a surprise,” a representative of an industry body who attended the familiarisation meet said.

The new pricing system is supposed to be transparent as per Coal India, as there would be little chance of ‘grade slippages’ for customers.  It would also get rid of many disputes and tussles primarily between Coal India and power producers.

TAKING MEASURES

  • The PSU mining giant was supposed to implement a billing policy from April 1
     
  • Under the new system it would charge customers for exact units of energy consumed
     
  • The new system would get rid of many disputes and tussles primarily between Coal India and power producers
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