The new policy is expected to help a large number of thermal power plants, which have been waiting for the fuel supply despite adequate domestic stockpiles. The policy will help revive 30,000 MW of power plants in the country and major beneficiaries in private sector include Reliance Power, Adani Power, Bajaj Hindustan, Lanco and Jindal Power. Press Trust of India file photo
The Centre on Wednesday approved a new coal allotment policy for power projects to ensure all coal-fired power projects get sufficient supply through a bid process or power purchase agreements. The policy, which is called 2017-SHAKTI (Scheme for Harnessing and Allocating Koyala (Coal) Transparently in India), was approved by the Cabinet Committee on Economic Affairs (CCEA) headed by Prime Minister Narendra Modi.
The new policy is expected to help a large number of thermal power plants, which have been waiting for the fuel supply despite adequate domestic stockpiles. The policy will help revive 30,000 MW of power plants in the country and major beneficiaries in private sector include Reliance Power, Adani Power, Bajaj Hindustan, Lanco and Jindal Power.
According to the policy, coal linkages will be provided to state and central government-owned power generating companies based on the recommendations by the power ministry, Power and Coal Minister Piyush Goyal said here. However other companies will have to go through a bidding process, he added.
With the new policy, the old linkage allocation policy will end and a new linkage allocation policy based on transparent and objective criteria for the optimal utilisation of the natural resources will come into existence,a statement from the government said.
The CCEA has also approved the signing of fuel supply agreement (FSA) with the letter of assurance (LoA) holders, it said. Allocation of linkages for the power sector shall be based on auction of linkages or through power purchase agreement based on competitive bidding of tariffs except for the state and the central power generating companies and the exceptions provided in Tariff Policy, 2016, it said.
As per the new policy, thermal power plants (TPPs) having LoA will be eligible to sign a FSA after ensuring that the plants are commissioned, the respective milestones met, all specified conditions of the LoA fulfilled within specified time frame and where nothing adverse is detected against the LoA holders and the TPPs are commissioned before March 31, 2022.