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State-owned electricity generation companies will stop using imported fuel after this fiscal, Coal Secretary Anil Swarup said on Thursday.
“Power generation companies owned by Centre and States imported 35-40 million tonnes of coal in 2015-16. We have cut it down by 15 mt this year. After March 31, 2017, there will be zero imports by public sector generation companies,” he said.
Swarup was speaking at a seminar on “India’s coal sector - vision 2020”, organised by the MCC Chamber of Commerce and Industry in Kolkata.
He said while the government is keen on allowing entry of the private sector in commercial coal mining, the step is delayed both due to low demand for coal and capacity maximisation by the State-owned Coal India.
Coal India has done such a good work that supply constraints have been removed and not many may be interested in entering the sector at this juncture, he said.
The government, he said, is cautious of meeting all demand pockets before moving to a market-driven mechanism.
“The Minister doesn’t want the linkages (the conditional permission to get fuel from CIL) He wants coal to be available freely. But we are still not confident enough. A mere 5-6 per cent rise in capacity utilisation of thermal power plants from the current level of 59-60 per cent will create a shortage at current level of production,” he said. Describing the 1 billion tonne production target in 2020 as an “aspiration target”, Swarup said the aim of the government was to be ready to meet the demand as and when it bounces back.
Sales declineThe State-owned miner is currently cutting down production to keep pace with low demand and liquidate the high pithead stock. During April-October, coal sales were down 1.2 per cent and production was down 0.1 per cent.
On his vision for the coal sector, Swarup said the government was determined to make “grade slippage” (over-charging consumers) in CIL supplies a thing of the past.
On the environment front, he said the government has decided that all CIL mines should transport coal from the pit-head to the railway siding by covered conveyors. This will prevent air pollution in the mining belt.
CIL is setting up 15 washeries. This will arrest environmental concerns related to burning of coal.
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