The government has modified the New Coal Distribution Policy in view of the presidential directive asking state-owned CIL to enter into pacts for assured supply of fuel to power firms ms 78,000 MW capacity.

“Government has approved a revised arrangement for supply of coal to the identified thermal power stations (TPPs) of 78,000 MW. Taking into account the overall domestic availability and the likely actual requirements of these TPPs, it has been decided that FSAs will be signed for the domestic coal quantity of 65%, 67% and 75% for ACQ (annual contracted quantity) for the remaining four years of the 12th Plan,” according to an Official Memorandum.

Earlier, the Policy said the Coal India (CIL) would supply 100 per cent of the committed quantity to power plants at prices to be notified by the coal PSU.

It also said that in order to meet the domestic requirement, CIL would import coal as required from time to time, if feasible and adjust the overall price accordingly.

Highlighting the amendment in the policy the memorandum said, “To meet its balance FSA obligations towards the requirement of the said 78,000 MW TPPs, CIL may import coal and supply the same to the willing power plants on cost plus basis. Power plants may also directly import coal themselves, if they so opt.”

“The New Coal Distribution Policy...stands modified,” it said, adding that “CIL and its subsidiaries and SCCL are advised to take further action accordingly.”

The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Manmohan Singh, on June 21 asked CIL to sign FSAs for a total capacity of 78,000 MW including cases of tapering linkage, which are likely to be commissioned by March 31, 2015.

Last year, the government issued a Presidential directive asking CIL to supply at least 80 per cent of the quantity committed to power companies.