The Coal Ministry on Friday said that rationalising linkages to reduce the distance between mines and 73 thermal power plants (TPPs) has resulted in rationalising 92.16 million tonnes (MT) of the commodity with annual potential savings of around ₹6,420crore

The Ministry initiated a policy measure, rationalisation of coal linkages, to reduce the distance in transportation mines to consumers, thereby decreasing transportation costs and increasing efficiency in coal-based power generation, the Ministry said.

Coal linkage rationalisation in the power sector has resulted in a decrease in transportation cost from mines to the TPPs leading to more efficient coal-based power generation. The exercise helps in reducing the load on transportation infrastructure, easing the evacuation constraints as well as reducing the landed cost of coal, it added.

“So far, four rounds of rationalisation of linkage have taken place, covering 73 TPPs, out of which 58 belong to State/ Central Gencos and 15 to Independent Power Producers (IPPs). The rationalisation of linkage has resulted in rationalising of total 92.16 MT of coal, with annual potential saving of around ₹6,420 crore,” Ministry noted.

As part of the Ministry’s comprehensive strategy for rationalisation of coal linkages, Coal India (CIL) has taken a significant step by inviting Expressions of Interest (EoI) from both IPPs and generating companies (gencos). This visionary policy aims to substantially reduce transportation costs thereby curbing fuel expenses, delivering tangible benefits to consumers.

Through rationalisation of coal linkage, coal PSUs are not only optimising operational efficiency but also driving down costs and fostering a more sustainable energy ecosystem. This policy demonstrates our commitment to balance economic growth along environmental sensitivity. The Ministry of Coal’s innovative policy initiative continues to shape a future where efficiency, affordability, and environmental responsibility harmonise seamlessly.