Delhi owing to ease of purchase, better prices and the speed of execution. Last week, the Central Electricity Regulatory Commission (CERC) was directed by the union government to allow power plants to blend up to 30 per cent imported coal till March 2023, without requiring approval from states buying electricity. The move was aimed at expanding coal stocks at power stations as they deplete at a record rate amid growing demand for electricity on account of higher temperatures.
This month, Coal India’s supplies to the power sector have been averaging at 1.65 million tons per day. According to recent figures, there has been a rise in daily power generated from domestic coal to 3,244 million units this month, from 2,465 million units from the same time last year. Power generation through imported coal has also risen, to 303 million units, compared to 211 million units in May 2021.
Accordingly, the issue of socialising costs by blending cheaper domestic coal with expensive imports was discussed during a recent meeting chaired by the Minister of Power, RK Singh. According a government official, under such an arrangement, recovering costs later from electricity distribution companies would be easier.
Last week, Minister Singh told the Economic Times that blending 10 per cent imported coal would result in an increase of ₹0.5 per unit in the price of power. Accordingly, Power Finance Corp and its subsidiary Power Finance Corp, owned by the Ministry of Power, have been directed by the Ministry to relax their prudential norms when providing working capital loans to state power generation firms to purchase coal during the 2022-23 financial year.
