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Reverse Bidding Methodology for Auction of Coal Mines for Power Sector



Reverse Bidding Methodology for Auction of Coal Mines for Power Sector
Reverse bidding methodology was adopted in the auction of coal mines earmarked for power sector under the provisions of Coal Mines (Special Provisions) Act, 2015 and the rules framed thereunder in order to ensure that there is no rise in power tariffs. This was stated by Shri  Piyush Goyal, Minister of State (IC) for Power, Coal & New and Renewable Energy in a written reply to a question in the Lok Sabha today.  Under the reverse bidding methodology, bidders have to submit bids below the Coal India Limited’s notified price for corresponding grade of coal which is the ceiling price. The lowest bid submitted is taken as the fuel cost in determination of power tariff. In case, bid price reaches Rs. Zero in reverse bidding, the bidding changes to a forward one where bidders have to quote additional premium payable to the State Government where the mine is located, over and above the fixed reserve price of Rs. 100/- per tonne. The reverse bidding methodology for auction of coal mines for power sector has been designed keeping in view the interest of power consumers. 


The Minister further stated that The Ceiling Price and the Closing bid in Rs./Tonne in respect of the coal blocks auctioned to the Power Sector is as under:-


S.No.
Name of the Coal Mine
Celing Price (Rs./mt.)
Closing Price (Rs./mt.)
Initial Reverse and then Forward bidding (F) for Power Sector

1
Tokisud North
970
1110 (F)
2
Amelia North
1250
712 (F)
3
TalabiraI
610
478 (F)
4
Sarisatolli
700
470 (F)
5
Trans Damodar
1600
940 (F)
6
Mandakini
860
650 (F)
7
Utkal  C
660
770 (F)
8
Jitpur
660
302 (F)
9
Ganeshpur
700
704 (F)


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Environmental Clearance of CIL Projects
During the year 2015-16 (as on 01.12.2015), Twelve projects have been accorded Environmental Clearance (EC) and four projects have been accorded Stage II Forestry  Clearance (FC).  This was stated by Shri Piyush Goyal, Minister of State (IC) for Power, Coal & New and Renewable Energy in a written reply to a question in the Lok Sabha today. The details of which are as given below:-  
Projects granted Environmental Clearance (EC) during 2015-16 -

SL
Name of the Company
Project
Total EC
Incr EC
1
Western Coalfields Limited
Kamptee Deep OC
2.00
0.50
2
Western Coalfields Limited
Juna-Kunada OC Expn
1.50
0.30
3
South Eastern Coalfields Limited
Chirimiri OCP
2.70
2.70
4
Eastern Coalfields Limited
Cluster 4
7.71
7.71
5
Eastern Coalfields Limited
Cluster 11
10.90
9.37
6
South Eastern Coalfields Limited
Bijari OC
2.25
2.25
7
Western Coalfields Limited
Junad Extn
1.50
0.50
8
Northern Coalfields Limited
Amlohri OC
14.00
4.00
9
Western Coalfields Limited
Niljai OC
3.50
0.00
10
Central Coalfields Limited
Pichri OC
1.50
1.50
11
Mahanadi Coalfields Limited
Hingula Extn. OC
15.00
3.00
12
Western Coalfields Limited
Makardhokra-I peak
2.00
1.00


 Total
64.56
32.83

Projects granted Stage II FC during 2015-16-

Name of the Company
Name of Projects
Area of forest land (in Ha.)
Mahanadi Coalfields Limited
Samleshwari OCP
21.87
South Eastern Coalfields Limited
Gevra Expansion OC
803.11
Central Coalfields Limited
Rohini Phase-II OCP
74.81
Western Coalfields Limited
Mohan OC  Phase-III Jamai Block
48.92
Total
948.70
RM/RS-  USQ863 – LS

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Liberalised Coal Linkages

                       The provision of allowing inter power plant transfer of coal under coal linkages  from one Power Plant to another is already in place. This was stated by Shri Piyush Goyal, Minister of State (IC) for Power, Coal & New and Renewable Energy in a written reply to a question in the Lok Sabha today. Such dispensation is allowed subject to the following conditions:

a)      Transfer of coal is allowed only between the power plants wholly owned by the Purchaser or its wholly owned subsidiary. No transfer of coal is allowed for a Joint Venture (JV) company of the Purchaser. The supply of coal, for all commercial purpose under the Fuel Supply Agreement (FSA) remains unchanged and on account of the original Power Plant.
b)      Both the Power Plants should have executed FSA in the modified FSA Model applicable for new power plants and not having any supplies linked to coal blocks. In case of Independent Power Producers (IPPs) both the plants must have valid long term Power Purchase Agreements (PPAs) with DISCOMS.
c)      In no case the transferred quantity to a plant together with the quantity supplied under the applicable FSA exceeds the Annual Contracted Quantity (ACQ) of the Transferee Plant for a particular year which is proportional to the long term PPA with DISCOMS.
d)     Transfer of coal is not allowed to those plants who are allotted coal blocks under this arrangement.
e)      In case of change in ownership and no environmental clearance of the plant this facility stands withdrawn, and
f)       Penalty/Incentive under this arrangement is considered in terms of (a) above.
       
            The Minister further stated that Coal India Limited (CIL) has planned to set up 15 new washeries. Out of these, 9 washeries are planned for non- coking coal with capacity of 94 Million Tonne Per Year ( MTY) and 6 coking coal washeries of capacity 18.60MTY.

The details of the proposed washeries are as follows:

Sl No.
Subsidiary
Company
Name of the
Washery
Capacity (MTY)
1
BCCL
Madhuband
5.0
2
BCCL
Patherdih
5.0
3
BCCL
Dahibari
1.6
4
BCCL
Patherdih
2.5
5
BCCL
Dugda
2.5
6
BCCL
Bhojudih
2.0
7
MCL
Hingula
10.0
8
MCL
Jagannath
10.0
9
MCL
Basundhara
10.0
10
MCL
IbValley
10.0
11
CCL
Ashoka
10.0
12
CCL
Konar
7.0
13
CCL
Karo
7.0
14
SECL
Baroud
5.0
15
SECL
Kusmunda
25.0
Total
112.60




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