Consumers' Page

Present Coal Scenario:

National miner Coal India Limited’s production and offtake figures for November ’21 improved compared to the same month a year ago as the unprecedented coal crisis across India’s Power sector eases out to an extent and coal stock at most of the inventories rose above critical level. In November, CIL produced 53.8 MT of coal which is over 4% more than 51.7 MT in Nov ’20. For the period of April’21 to November’21 CIL’s cumulative production stands at 353.4 MT which is 5.6% higher than the same period last year, when all sectors including coal were severely hit by the pandemic outbreak. Coal offtake by the Maharatna Company has also gone up by more than 10% from 51.3 MT in Nov ’20 to 56.8 MT in November this year. The cumulative coal offtake figures by CIL for the ongoing fiscal has been nearly 18% higher than the same period in the previous financial year.

Issues faced by Power Sector Consumers:

1. Submission by Power sector regarding regular and significant short-supply from various mines of MCL, SECL, ECL & WCL:

*Power consumers procuring coal from MCL’s Talcher, Sardega and IB Valley sidings under Linkage auction FSA were facing regular shortreceipt in rakes to the tune of 4%-5% while on some occasions, short-receipt ranged up to 9% as well. The issue of short-receipt kept recurring even after recalibration of weighbridges of the affected sidings. *ForPower Utilities procuring coal from SECL’s Burhar, Churcha, Naurajabad, Bhatgaon, Rajnagar OC, Katora and NCPH sidings, 4%-7% short-receipt was occurring in almost all the rakes supplied during Oct-Nov’21 period. *ForPower Utilities procuring coal from ECL’s Bankola, Jhanjra, SonepurBazari, Pandaveswar, regular short-receipts to the tune of nearly 2% was occurring in the rakes supplied from those sidings in October ’21. *For Power Sector Consumers procuring coal from various sidings in Wani area of WCL, regular short-receipts to the tune of over 3% was occurring in the rakes supplied during October ’21. As such regular instances of short-receipts lead to significant financial loss to the generators, requests has been made to CIL and the concerned Subsidiary Coal Companies to take up necessary measures including ensuring proper loading of coal in rakes, examining the weighbridges at regular intervals etc. so that the issue of short-receipt could be mitigated. .

2. Submission by Power sector

regarding significant grade slippage in coal supplied via Rail Mode:

*Power Sector Consumers procuring coal from ECL’s POCP, Bankola, SonepurBazari sidings were facing the issue of grade slippage as coal received from those sidings during August-October ’21 period had been 3-4 grade lower than the declared grades (G4-G5), while in a few rakes grade slippage has been as high as 7 grades. *Power Sector Consumers procuring coal from NCL’s Dudhichua, Dudhichua WW, Bina WW, Block-B sidings were facing the issue of grade slippage as coal received from those sidings during August-October ‘21 period had been 2-3 grade lower than the declared grades (G7-G11). *Power Utilities procuring coal from CCL’s Birds Sounda and Churi sidings were facing the issue of grade slippage as coal received from those sidings during August-October ‘21 period had been 2-3 grade lower than the declared grades (G7-G9) while in a few rakes grade slippage has been as high as 5 grades. As some of these Power Plants are in agreement to supply the entire power generated to the state discoms, request has been made to CIL and the respective Subsidiaries take adequate steps in order to eradicate grade slippage and ensure supply of FSA-grade of coal.

3. Submission by Power consumers regarding impediments of coal transport through RcR mode:

While procuring coal through Road-cum-Rail (RcR) mode as and when supply through Rail mode is not sufficient, the Power Sector Consumers are facing certain issues: *As it is an intermittent supply arrangement, number of interested bidders is significantly less which causes the rate for loading and transportation of coal to be significantly higher

than the long-term contract awarded by the Coal Companies. *There is substantial time lag between the issuance of DOs and starting of supply of coal from pithead to Railway good sheds in RcR mode due to formalities such as obtaining mining permit, truck permit etc. *Each Road loading point functions with a fixed capacity for loading a certain number of trucks per day. Therefore, when more consumers procure from the same source, deployment of no of truck per consumer gets drastically reduced resulting in lifting of less quantity on a daily basis. Request has been made to CIL to ensure that consumer-wise allocation of coal quantity may be commensurate with the loading capacity as per available infrastructure of a particular road loading point to avoid congestion at mine end and rational allocation of good sheds / private sidings based on booked quantity may be provided to ensure smooth supply of coal under RcR mode.

5. Request for consideration of CEA norms in determining normative coal requirement for CPP sub-sector in Tranche-V NRS Linkage Auction:

As per coal consumption norms laid down by CEA for CPP Sector, certain factors needs to be considered for calculating normative coal requirement including loss of heat value of coal for storage @85 KCal/kg, 5% GCV loss due to the difference between GCV (ARB) and GCV (EQ) and 0.8% transit loss. However, these factors are not considered in the calculation of normative coal requirements as given in the scheme document of CIL. As a result, the Captive Power Plants will be eligible for less quantity of coal in comparison to their actual coal requirement in the upcoming NRS Linkage Auction. Request has been made to CIL so that normative requirement of coal in the CIL scheme document for NRS linkage auction for the different capacity Captive Power Plants may be calculated as per existing CEA guidelines.

4. Submission by Power Sector to expedite release of e-Auction rakes:

There has been extremely low materialization of rakes allotted under e-Auction including Special Forward e-Auction for Power Sector. It has been pointed out that a large number of rakes allotted for Power Sector under various e-Auction schemes have been pending since long. Request has been made to CIL so that at least 15% - 20% of the total supply of rakes / day may be earmarked and supplied against e-Auction quantities. This would enable the Power houses to build up their stock levelswithin the ensuing Q3 & Q4 of the current FY with adequate supply.

Issues faced by NRS Consumers:

6. Request for allowing NRS Consumers who had cancelled their FSA within Lock-in period to participate in the Tranche-V NRS Linkage Auction:

The successful bidders of Tranche-IV NRS Linkage Auction, who had cancelled their FSAs within the lock in period of two years, are debarred from participating in the ongoing Tranche-V NRS Linkage Auction as per FSA norms. Also, may have terminated their FSAs even after the completion of lock-in period are also not being allowed to participate in the upcoming Tranches as their IDs have been blocked due to untimely termination of Tranche-IV agreement. However, respective quantities booked by these NRS consumers in Tranche-I have already expired. Request has been made to CIL to allow these

consumers to participate in the ongoing NRS Linkage auction for CPP and Other Sub-sectors (Tranche-V) for materialisation of their eligible normative quantity except the terminated quantity within the lock-in period of the immediately previous tranche (Tranche-IV).

7. Submission by NRS consumers to allow inter-plant transfer of coal:

Certain plants from the Non-regulated Sector are often facing constraints due to restrictions on rake allocations and of coal movement via Road and RCR modes for Non-regulated Sector. Also, coal stock at some plants remain alarmingly low due to lack of production/transport issues at the designated mines which eventually hampers the plant operations. Submission has been given to the Ministry of coal to allow interplant transfer of coal within the same company/business group (within different units of the same organisation) for higher capacity plants in the Non-power Sector in line with the Power Sector as it wouldensure maximum lifting of booked Linkage/Exclusive e-Auction quantities, reduce dependence on imported coal and encourage the NRS consumers to go for more long-term Linkage/Exclusive Auction security.

8. Submission by NRS Consumers for change of mode from Rail to Road/ RcR:

In order to ensure uninterrupted generation of electricity across the country, coal supply to the Power sector has been prioritized. As a result, rakes allotted to many successful bidders from the Non-power sector in the recently conducted Spot e-Auctions are getting delayed indefinitely. Request has been made to the Ministry and CIL to allow the NRS consumers to opt for change of mode for coal transport temporarily from Rail mode to Road mode as well as Road cum Rail (RcR) mode if the allocation of rakes is delayed beyond 90-days period.