Injustice in coal supply to Gujarat: Here is centre’s unconvincing reply



New Delhi, 22 March 2013

The State government has time and again alleged that the centre is not approving coal supply to Gujarat from Western Coal field which is closer compared to existing supply source in South Eastern India. The Gujarat government alleges that in absence of supply from nearer sources, the state has to bear more transport costs.

The state government alleges that it has to pay an additional sum of Rs 1,000 crore a year to transport coal from far off coal fields. Energy minister Saurabh Patel recently said that because of the wrong policies of the Centre, the state was paying Rs 1,000 crore extra for getting coal from the southern and the western coal fields. He said that the Centre was giving 85 per cent coal to Maharashtra from the central coal field and Rajasthan was getting 100 per cent coal from the western coal field. In addition, due to the frequent hikes in the railway tariff for coal an additional burden of six paise per unit was imposed on the consumers, the minister said, adding that the increase in the tariff by the railway minister would further impose a burden of Rs 120 crore on Gujarat. This hike was also likely to be passed on to the consumer thus increasing the per unit price of power. The minister has earlier said that the coal was transported to the state from western coalfields 775km away, while southern fields are 1,180 km away. In 2011-12, there was an increase in the power price by Rs 0.15 per unit which had imposed an additional burden of Rs 84.52 crore on the end users and again in 2012-13, there was an increase of Rs 0.26 per unit which imposed an additional burden of Rs 108.46 crore by December-end.

Now, two Members of parliament in Lok Sabha recently raised this question. The questions and replies of the Union minister are presented here:

Question: Whether the coal based power companies situated in Gujarat have been allocated coal from the South Eastern Coal Belts instead of the Western Collieries Limited (WCL) which is nearer to the State; if so, the details thereof and the reasons therefor along with the criteria for coal allocation from the WCL;

Minister of State in the Ministry of Coal Shri Prataik Prakashbapu Patil replies: The coal based companies including power stations situated in Gujarat are being supplied coal from South Eastern Coalfields Limited (SECL).

However, a small quantity of coal is also supplied from Western Coalfields Limited (WCL).

The decision for source of allocation of coal is based on the long-term availability of coal, potential for incremental production, transport logistic etc.

The major coal reserves of Coal India Limited (CIL) are concentrated in the coalfields of Karanpura (Northern India), Ib, Raigarh (East Central India), Korba (Central India) and Talcher (Eastern India).

These are the upcoming coalfields of CIL, there is not much growth prospects in WCL. Further, the coal available at WCL is already linked to various power stations/industries.

Question: Whether the Government has received any proposal from Gujarat to consider allocation of coal to coal based industries in the State from the nearer coal belts; and if so, the details thereof and the response of the Government thereto?

Minister of State in the Ministry of Coal Shri Prataik Prakashbapu Patil replies:The request of Gujarat for enhancement of allocation of coal from WCL has been examined by the Task Force constituted by Ministry of Coal for rationalization of sources for existing coal consumers.

The Task Force recommended for reduction in quantity allocated to Gujarat State Electricity Corporation Limited (GSECL) from Korea Rewa fields of C/D grade coal and proportionate increase from Korba fields of South Eastern Coalfields Limited (SECL) by swapping quantities of Madhya Pradesh Power Generating Company Limited (MPPGCL).

In view of the recommendations of Task Force, Central Electricity Authority (CEA) has to take up the matter with GSECL and MPPGCL for their concurrence in respect of the implementation of the specific recommendations on this aspect.

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It should be mentioned that the said inter-ministerial Task Force under the Chairmanship of Joint Secretary, Ministry of Coal, comprising representatives of Ministries of Power, Railways, Steel, Commerce and Industry, Central Electricity Authority, National Thermal Power Corporation and Coal India Limited/Coal companies was constituted to undertake a comprehensive review of existing sources and consider the feasibility of the rationalization of these sources. Objective of constitution of the Task Force was to consider the feasibility of rationalization of the existing sources of coal supplies with a view to minimizing transportation cost within the given technical constraints. It was thought upon that the benefits of such rationalization including faster turnaround of railway rakes, lower transportation cost and lower transit losses would accrue to the consumers.

The Task Force submitted its report on 24th August 2011. The salient features of the recommendations of the Task Force are given below:

-Acceptance of the recommendations of the Functional Directors of Coal India Limited in respect of rationalization of existing sources in respect of applications received from Captive Power Plants, Sponge Iron Plants and Cement Plants.

-Rationalization of coal supplies for Sanjay Gandhi and Satpura Thermal Power Plants of Madhya Pradesh Power Generation Company Limited (MPPGCL)

-Reduction in quantity allocated to Gujarat State Electricity Corporation Limited (GSECL) from Korea Rewa fields of C/D grade coal and proportionate increase from Korba fields of South Eastern Coalfields Limited (SECL) by swapping quantities of MPPGCL.

-Rationalization of sources for Panipat and Rajiv Gandhi Thermal Power Stations of Haryana Power Generation Company Limited, Mejia and Koderma Thermal Power Stations of Damodar Valley Corporation, Santhaldih, Kolaghat, Sagardighi and Bakreshwar Thermal Power Stations of West Bengal Power Development Corporation Limited and reduction in coal allocation from Mahanadi Coalfields Limited (MCL) and enhancement in coal allocation from Eastern Coalfields Limited (ECL) for the power plants of Tamil Nadu Electricity Board.The recommendations of the Task Force have not been fully implemented as some of the state governments have not agreed to the same.

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To sum up, there’s no relief to Gujarat in these recommendations.