Public sector behemoth Coal India has been asked to e-auction the surplus coal from its mines that have been facing evacuation constraints as supplies are being held back even as power plants are confronted with an acute shortage.
"Coal which is found surplus at the said mines (having serious evacuation constraints) after meeting the requirement ... shall be e-auctioned," the coal ministry has said in a letter sent to CIL. Under e-auction, coal is sold at spot market price.
"There has been a large accretion of coal during this peak production season at mines which have serious evacuation constraints," said the ministry. But this has to be made available to power plants which have signed fuel supply agreements (FSAs) on a priority basis as there is an acute shortage.
The ministry further said that at the beginning of each month-December-March-in the ongoing fiscal, CIL will notify on its portal and website of its subsidiaries, the quantity of coal likely to be surplus till month-end at mines facing evacuation constraints.
Requests will be invited simultaneously on the websites itself from the consumers of the following categories (power plants commissioned before 1.4.2009 having FSAs with the coal companies, power plants which have got commissioned after 1.4.2009 and which have FSAs) regarding the quantities of coal they can evacuate on their own till month end from the said mines, the ministry said.
The arrangement will be in place till next March, it added. The company was directed to limit e-auctioning of coal to 25 million tonnes (MT) this year from 57 MT. CIL, which accounts for more than 80 per cent of the domestic coal production, mined 462 MT coal last fiscal missing its target of 482 MT.