Constant policy flips over coal imports has fazed state-owned power generating companies (gencos) and independent power producers (IPPS) with a cumulative capacity of 108 gigawatts. The Centre, on the one hand, is pressuring them into using imported coal-5x costlier than domestic fuel. On the other, state governments are wary of paying for imported coal, which will crank up electricity costs.
At the same time, two weeks after state and privately-owned gencos were told to import coal for 10 per cent blending, the Union Ministry of Power has now asked them to keep their tenders 'in abeyance'.
The Centre has directed national miner Coal India (CIL) to import coal for state and private gencos.
The directive follows a push-back from several states that refused to pay higher tariffs due to imported coal. Uttar Pradesh and Maharashtra are leading the pack.
A senior executive of a Maharashtrabased IPP said the Maharashtra Electricity Regulatory Commission (MERC) in a recent hearing of its plea observed that arranging fuel supply is the responsibility of the IPP and the state is in no way liable to pay higher tariff if it imports coal. On the plea of advance payment by distribution companies (discoms), MERC said a genco cannot import coal in anticipation, he clarified.
This story is from the May 30, 2022 edition of Business Standard.
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This story is from the May 30, 2022 edition of Business Standard.
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