Coal linkages to cement, steel sectors via auction: Cabinet

Coal linkages for 24 million tonnes would go under the hammer in the first year.

February 03, 2016 02:17 pm | Updated 02:17 pm IST - New Delhi

Power and Coal Minister Piyush Goyal. File photo

Power and Coal Minister Piyush Goyal. File photo

Allocation of coal linkages for the non-regulated sector, which includes steel and cement, will be only through the auction route to ensure transparency, government said on Wednesday.

“Cabinet Committee on Economic Affairs has approved allocation of coal linkages for non-regulated sector only through auction,” Power and Coal Minister Piyush Goyal told the media after the CCEA meeting.

“Sectors included are Cement, Steel/Sponge Iron, Aluminium, and others (excluding fertiliser, urea),” he said.

The framework attempts to make coal available in a fair manner to end-users, the Minister said.

“Proposed auction methodology leads to price through a market mechanism; it does not seek to maximise revenue”, he said, adding, “it ensures that all market participants of non-regulated sector have a fair chance to coal linkage, irrespective of size”.

Coal Secretary Anil Swarup said that coal linkages for 24 million tonnes would go under the hammer in the first year.

Mr. Goyal had earlier said the government is considering a policy for coal linkage auction.

Letter of Assurance is issued on furnishing Commitment Guarantee followed by execution of fuel supply agreement (FSA) on the fulfillment of LOA conditions in the stipulated period of time.

Till now, Standing Linkage Committee has been deciding on allocation of long-term and short-term linkages for the sectors, including power and steel.

0 / 0
Sign in to unlock member-only benefits!
  • Access 10 free stories every month
  • Save stories to read later
  • Access to comment on every story
  • Sign-up/manage your newsletter subscriptions with a single click
  • Get notified by email for early access to discounts & offers on our products
Sign in

Comments

Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.