Narendra Modi govt looks to bring efficiencies into power production, allows private plants to bid for coal with states


Narendra Modi govt looks to bring efficiencies into power production, allows private plants to bid for coal with states

Private power plants can now procure coal from state governments’ coal reserve, which is allocated for power production. The move aims to enhance the efficiency in utilisation of domestic coal. Under the arrangement, the state supplying coal will invite tariff bids from the prospective independent power generating stations for domestic coal. The move is in sync with the government’s earlier initiative of making the utilisation of domestic coal more flexible, wherein the fuel would be allotted to the power plants on the basis of efficiency.

Currently, there are instances where efficient power stations have shortage of coal while there are plants with low utilisation rates possessing abundant fuel. This development is expected to minimise the disparity. Under the new guidelines, the landed cost of power from the private power station should be lower than the variable cost of generation of the generating plant of the state, whose power is to be replaced by the private plant. The landed cost of power would be inclusive of the transmission charges. Read More…

Credit By : Financialexpress.com

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