India approves revised scheme for power sector coal allocation

The revision introduced two windows for better access to coal.

India’s Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi has approved the proposal to make coal more accessible to thermal power plants of central sector/state sector/ independent power producers.

According to the Ministry of Coal, the revised Scheme for Harnessing and Allocating Koyala Transparently in India (SHAKTI) has introduced two windows: Coal Linkage to Central Gencos/States at Notified price, and Coal Linkage to all Gencos at a Premium above Notified price.

Under the first window, the existing mechanism for grant of coal linkage to Central Sector thermal power projects including joint ventures and their subsidiary will continue. Meanwhile, the second window states that any domestic coal-based power producer having power purchase agreement or untied and also Imported coal-based power plants can secure coal on auction basis.

The revised SHAKTI Policy would not involve any additional cost to the coal companies.