Coal India Approves Shakti Scheme

Coal India Ltd said its board cleared the decks for signing of fuel supply agreements after the auction of coal linkages to Independent Power Producers having long-term Power Purchase Agreement have been concluded.

Under the 'Scheme for Harnessing and Allocating Koyala (Coal) Transparently in India' (Shakti), as much as 27.18 million tonnes of annual coal linkages have been booked by 10 successful bidders.

These fuel supply agreements are expected to result in an annual generation of over 47 billion units per annum from the linkage coal and an estimated savings in tariff of approx Rs 125 crore per annum for period upto 25 years, a statement said.

The Central government introduced the 'Shakti' policy, replacing the earlier discretion based system of granting coal linkages.

Under the new policy guidelines for allocation of coal linkages to various segments of power sector issued by the Coal Ministry, Coal India or Singareni Collieries Company Ltd are to grant coal linkages on notified price on auction basis for power producers having already concluded domestic coal based power purchase agreements.

According to the statement, the bidding parameter will be levelised discount on existing tariff that the power producer is willing to provide and the likely benefit arising out of the weighted average discount on tariff as quoted by the bidders for 2.72 paise per kWh will be around Rs 127 crore per annum.

The miner also said its board approved the introduction of evacuation facility charges at Rs 50 per tonne for despatch of coal except despatch through rapid loading arrangement.

As a result, the company would be generating approximately an additional revenue of Rs 2,500 crore for the full year and approximately Rs 800 crore for the rest of the current fiscal