Gencos to face penalty for having low coal stock, says govt

Power Ministry notifies new coal stocking norms, gencos to follow month-wise threshold

Thermal power generating companies (gencos) that do not maintain adequate coal stock will face penalty, which includes reduction in fixed charge of the tariff they levy from power distribution companies (discoms).

The Union Ministry of Power notified new coal stocking norms that require gencos to maintain adequate stock of coal to avoid any crisis during lean coal supply months.

The penalty will be computed based on the shortfall — wherein the fixed charge will be reduced to the extent of shortfall in normative availability of coal.

The ministry in its notice has tabulated month-wise stock to be maintained by pithead (near coal mines) and non-pithead (away from mines) plans. For pithead, the stock ranges from 12-17 days and for non-pithead 20-26 days.

The power plants have been instructed to maintain adequate stock during the fourth quarter to balance their coal need during the monsoon months, when coal supply dips.

The notice also said gencos will be graded on a monthly basis on their performance and status of payment to the coal companies.

Gencos to be fined for selling in open market without consent

The Union Ministry of Power in a gazette notification said gencos will be penalised if they sell contracted power in the open market without the consent of the buyer. “In case the seller fails to offer the contracted power as per the agreement to the procurer and sells this power without procu­rer’s consent to any other party, the procurer shall be entitled to claim damages from the seller for an amount equal to the higher of twice the tariff as per the PPA,” said the notification.