HPGCL secures coal supply from CIL arms

Haryana Power Generation Corporation (HPGCL) has secured coal supply for its power stations by signing a Fuel Supply Agreement (FSA) with three major subsidiaries of Coal India (CIL), namely Central Coalfields (CCL), Bharat Coking Coal (BCCL) and Northern Coalfield (NCL).

The tenure of the FSA has been fixed at 20 Years or the lifespan of the Power Station which ever is lesser.

The signing of FSA is a major step by HPGCL towards ensuring an assured and reliable supply of good quality and sufficient quantity of sized coal for the Generating Stations of HPGCL, so that they keep on running uninterruptedly and provide enough power for overall development of the State, said Sanjeev Kaushal, managing director of HPGCL in a release issued here today.

He said the FSA is a long term pact between Coal Producers and Consumers, aimed at ensuring a dedicated supply of fuel for the power stations.

"Under the FSA, the above said coal companies have agreed to supply and HPGCL has agreed to purchase every year the Annual Contracted Quantity (ACQ) of coal. The ACQ for HPGCL Power Stations from CCL is 50.90 Lakh MT, from BCCL 18.5 Lakh MT from NCL it is 16 Lakh MT," he said.  

The FSA also envisages a "trigger" level which is the minimum aasured level of coal supply and off take, failing which both the seller and the buyer attract penalty. He explained that the agreement incorporates a provision for penalizing short delivery or short lifting of coal against the agreed trigger level of 90 per cent of ACQ, to be supplied by the Coal Companies or to be lifted by HPGCL.   

Giving background details, he informed that before signing of FSA, the Generating Stations of HPGCL at Panipat, Yamunanagar and Faridabad, were receiving coal as per quarterly linkages allocated by the Ministry of Coal on the recommendation of Ministry of Power.

The New Coal Distribution Policy of the Government of India envisages that the linkage system be replaced with a more transparent, bilateral and commercial arrangement of enforceable FSAs. 

Accordingly, all the valid or existing coal consumers whose linkage during 2006-07 was 4200 MT or more, would have to enter into FSA with Coal Companies.