Worried at the fallout of the coal scam, the coal ministry is preparing a policy to ensure that any surplus coal from the allocated blocks will go to Coal India Ltd either at a notified price or at the cost of production.
Worried at the fallout of the coal scam, the coal ministry is preparing a policy to ensure that any surplus coal from the allocated blocks will go to Coal India Ltd either at a notified price or at the cost of production.
While this will be implemented with prospective effect, it will prevent power companies that had got these coal blocks, from making profits by selling surplus coal. The coal ministry, which was in the process of making the policy has decided to go against the advice of an Empowered Group of Ministers (EGoM) as well as the attorney general that had allowed Reliance Power to use surplus coal generated from the mines allocated for its 4,000 MW Sasan UMPP (Ultra Mega Power Projects) at its Chitrangi plant.
A coal ministry official said the decision has been taken to ward off any criticism by the Comptroller & Auditor General of India (CAG) for allowing Reliance Power to use surplus coal.
“We will be facing the Public Accounts Committee of Parliament on the Sasan UMPP. We want to take note of the recommendations of the CAG in the new policy,” a senior coal ministry official told DNA.
CAG, in its report on Ultra Mega Power Projects, had criticised the ministry for allowing Reliance power to use its surplus coal for its Chitrangi Project.
The accounting body had also said “the allocation of the third coal blocks in Chhatrasal be appropriately reviewed. Since the developer had committed that he would be able to source 20 million tonnes from the two blocks there would be adequate coal to feed the Sasan UMPP”.
The CAG has estimated the overall financial benefit to Reliance Power for being allowed to use surplus coal from Sasan mines at its Chitrangi project at Rs29,033 crore.
According to the ministry official, the decision was taken after much deliberation over the CAG report and even though the policy would be prospective and will not have any impact on the Reliance Power’s Surplus coal usage from Chhatrasal coal block, it will help the ministry to defend any accusations from the PAC’.
Incidentally, the EGoM on Sasan UMPP in its decision in April this year had said that the “ministry of coal will formulate a policy keeping in view the opinion given by the learned attorney general for use of surplus/incremental coal”
The attorney general had said in April that “it would be advisable if the EgoM decisions dealing with the allocations of captive blocks for UMPPs, the end use of coal generated, if any are consolidated in a comprehensive policy”.
There could be other measures that could be taken by a panic-stricken government desperate to deflect the attack of the opposition parties.
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