8 AUG, 2012, DEBJOY SENGUPTA, ET BUREAU
KOLKATA: Coal India has agreed to pay penalties of 1.5%-40% depending on the extent to which it fails to supply the committed quantity of coal to power plants.
Coal India board also agreed to pool imported and domestic coal supplies provided all existing consumers and stakeholders agree to the proposal.
Approval of the Central Electricity Authority and buyers such as the Railways is needed because price pooling would raise costs of coal for existing plants and raise power tariffs by about 8 paise per unit.
Only 25% of the cost of imported coal will be pooled and divided equitably among all power producers, officials said. The remaining 75% of the cost of imported coal would be borne by the power producers who consume the coal.
CIL chairman, S Narsing Rao said: "The final Fuel Supply Agreement (FSA) will be cleared at a board meeting scheduled on August 13 in Kolkata."
Ashok K Khurana, secretary of the Association of Power Producers, said: "Price pooling is a welcome move and the increase in cost of generation as a result will be marginal on consumers. However, the penalty for supplies between 65% and 80% is below international norms."
Rao said CIL may have to import at least about 20 million tonnes of coal in 2012-13. "Landed price of one tonne of coal with calorific value of 6,000 kilo calories will cost around 6,000 per tonne and total outgo as a result is expected to be 3,000 crore. Power producers using this coal will have to pay 4,500 per tonne for this coal. Rest of the money, 1,500 per tonne, will be shared from the pool which will put the burden on all power producers irrespective of their consumption. This is expected to increase cost of coal by about 87 per tonne."
"A 87 per tonne rise in coal prices will mean a 7 paise per unit rise in cost of generation on an average. However, we will arrive at a decision only when we have seen the revised FSA format," a senior NTPC official said.
KOLKATA: Coal India has agreed to pay penalties of 1.5%-40% depending on the extent to which it fails to supply the committed quantity of coal to power plants.
Coal India board also agreed to pool imported and domestic coal supplies provided all existing consumers and stakeholders agree to the proposal.
Approval of the Central Electricity Authority and buyers such as the Railways is needed because price pooling would raise costs of coal for existing plants and raise power tariffs by about 8 paise per unit.
Only 25% of the cost of imported coal will be pooled and divided equitably among all power producers, officials said. The remaining 75% of the cost of imported coal would be borne by the power producers who consume the coal.
CIL chairman, S Narsing Rao said: "The final Fuel Supply Agreement (FSA) will be cleared at a board meeting scheduled on August 13 in Kolkata."
Ashok K Khurana, secretary of the Association of Power Producers, said: "Price pooling is a welcome move and the increase in cost of generation as a result will be marginal on consumers. However, the penalty for supplies between 65% and 80% is below international norms."
Rao said CIL may have to import at least about 20 million tonnes of coal in 2012-13. "Landed price of one tonne of coal with calorific value of 6,000 kilo calories will cost around 6,000 per tonne and total outgo as a result is expected to be 3,000 crore. Power producers using this coal will have to pay 4,500 per tonne for this coal. Rest of the money, 1,500 per tonne, will be shared from the pool which will put the burden on all power producers irrespective of their consumption. This is expected to increase cost of coal by about 87 per tonne."
"A 87 per tonne rise in coal prices will mean a 7 paise per unit rise in cost of generation on an average. However, we will arrive at a decision only when we have seen the revised FSA format," a senior NTPC official said.
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