Under pressure from the Prime Minister’s Office to resolve the issue of coal linkages to the upcoming power plants, coal secretary SK Srivastav has called a meeting to discuss fuel linkage for power plants having a cumulative generation 60,000 mw on October 5.
According to sources, the coal ministry has decided that only projects which have signed power purchase agreements (PPAs) with states or distribution companies (discoms) will be given coal linkages.
This means the previous list prepared by the Central Electricity Authority (CEA) recommending power plants for fuel linkages could see some changes.
“It has been found that some of the power projects identified by CEA/ministry of power out of the said 60,000 mw may not be able to sign fuel supply agreements with coal companies. Conversely, some of the power projects which do not appear in the CEA list may achieve milestones, may be commissioned before 31.3.2015, and may have long-term PPAs with discoms,” read the ministry’s agenda for the meeting.
Companies such as Nabha Power Ltd and Talwandi Sabo Power are among those that may find a place in the new list of projects eligible for fuel linkages from Coal India and its subsidiaries.
There are about 570 applications for coal linkages pending with the ministry of which 460 are from the private sector. Another 460 coal applications from captive power plants are also pending with the ministry of coal.
The recommendation of the ministry of power plays a major role for getting fuel linkage from Coal India.
As many as 43 public sector undertakings have been recommended for fuel linkage by the power ministry.
In this meeting, the coal ministry will also discuss the application of 96 private sector companies with accumulative generation capacity of 91,000 mw.
The ministry of power and coal have been at loggerheads over the issue of signing FSAs as the power ministry wants Coal India to sign FSAs with power project developers by which Coal India is penalised in case it fails to provide 80% of the fuel agreed to.
Also, the power ministry has been pushing Coal India to import coal and sell it to the power project developers by pooling the cost of domestic and imported fuel.