Coal India seeks state governments consent on price pooling

State-run CIL has asked the state governments to convey their views on price pooling of coal. 

 

The development comes close on the heels of CIL board approving the modified fuel supply agreement (FSA) without price-pooling with 65 per cent domestic coal and 15 per cent imported coal at cost plus basis. 

 

"Almost a week back we wrote to all the states, barring Jammu and Kashmir and Himachal Pradesh, seeking their opinion on whether they agree to the price pooling or not," a source close to the development said. 

 

"Central Electricity Authority (CEA) is also working parellely on price pooling mechanism," the source said.

 

The modified FSA has modifications in penalty, moratorium on penalty and some changes in force majeure which were already cleared by the board earlier, the company said. 

 

CIL Chairman and Managing Director Narsing Rao had earlier said that PSU firm had written to power companies for their feedback on the mechanism. 

 

Earlier, Rao had said that if price pooling was implemented, all the power consumers would have to bear the impact, adding that, however, it should be neutral to CIL. 

 

To offset the impact of high import costs, the Planning Commission had said that CIL should adopt a pooling formula on prices by combining rates of imported and domestic coal. 

 

So far, only 29 power companies, including Lanco and Adani have signed FSAs with CIL.