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Amidst expectation of the appointment of coal price regulator, Coal India today effected a 30 per cent increase in prices for non-regulated sectors such as cement, iron and steel, aluminium, paper, among many others. The decision will impact captive generation.
Though the regulated sectors, including power and fertiliser, are largely spared from the price hike, a parallel decision to bring parity in the prices of the E & F grades of coal produced by different subsidiaries has made the offerings of Mahanadi Coalfields (MCL) costlier for the power sector by a flat Rs 90 a tonne or 20 per cent. The decision will impact NTPC, DVC, the state power utilities of West Bengal, Tamil Nadu, Andhra Pradesh, Haryana and Maharashtra and others.
The impact is more on the buyers of MCL coal from non-regulated sectors who will now have to fork out 30 per cent over and above the Rs 90/tonne increase. Price of coal for these sectors will move up 54 per cent. National Aluminium Company will be severely hit in this segment.
The buyers of approximately 5 million tonnes of high quality (over 5600 kcal) A and B grade coal of SECL will also be impacted as the notified price of this variety is nearly double to Rs 4,000 a tonne. However, this is still 15 per cent cheaper than the six months average of landed cost of imported coal.
CIL already sells these varieties produced by Eastern Coalfields at similar import-linked prices.
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