PowerMin's request on linkages for GVK Power's plant rejected

CIL and its subsidiary coal companies are reporting negative coal balance, therefore there is no scope for issue of any new LoA, says Coal Ministry

The Coal Ministry has rejected the Power Ministry's request to grant linkages for GVK Power's 540 MW plant in Punjab saying that state-owned CIL has a "negative coal balance".

"It is stated that CIL (Coal India Ltd) and its subsidiary coal companies are reporting negative coal balance, therefore there is no scope for issue of any new LoA (Letter of Assurances) to any power project," according to a Coal Ministry document.

The ministry had received a reference from the Ministry of Power which stated that the first unit of GVK's 540-MW TPP (Thermal Power Project) has successfully completed the synchronisation test in July, 2013.

The Power Ministry had further stated that the developer has cited several reasons beyond its control in carrying out mining operation from the allocated captive coal mine Tokisud North Block in Hazaribagh district of Jharkhand.

"Since power plant (GVK Power (Goindwal Sahib)) will be ready before the commissioning of the mine, MoP (Ministry of Power) has requested for allocation of 1.5 million tonnes (MT) of coal for testing and timely commissioning of their first unit," the document said.

Earlier, the Coal Ministry had issued show-cause notice to the company for not beginning the production from Tokisud coal block allocated to it within the stipulated time frame.

The estimated coal production through CIL sources during the current fiscal is estimated at 492 MT. Out of this, 379 is earmarked for the power sector.

From this quantity, 275 MT is needed to meet the requirements of power plants commissioned prior to March 31, 2009, thus leaving a balance of 104 MT for the power plants commissioned from April 1, 2009.