Disparity in coal pricing in Indian states: Bengal minister

Pointing out a glaring "disparity in terms" for coal prices among the states that necessitates a coal regulator, a West Bengal minister Friday stressed that the country must maximise its coal production capacities to meet future energy demands.

Manish Gupta, West Bengal power and non-conventional energy sources minister, also criticised the central government for failing to establish an energy security policy despite the Planning Commission setting up a task force on the issue.

"From our end (Bengal government) we have urged the central government to publish a energy security policy... we don't have one," said Gupta, speaking at the 'Energy Sustainability Conclave 2013: Energy Security-Empowering the Energy Future', organised here by the Bengal Chamber.

Gupta said: "The planning commission has set up a task force to look into this aspect saying that planning has to precede actions and measures that we need to control this situation but that has not happened."

He criticised the absence of proper regulation and monitoring in coal pricing and supply by referring to Coal India that has monopoly over the market.

"Why should we pay more because coal is being imported for bigger players in other states? So there is a disparity in terms and lack of objectivity," said Gupta.

"Over the past three years, Coal India has unilaterally increased the coal price so the tariff has gone up. Coal regulator needs to look at the cost of coal because the consumers need it to be reasonable to be able to use it.

"Why has the coal sector not been given adequate importance? Why has the coal regulator not been set up? There are regulators in other sectors."

The coal ministry in May 2012 had moved the Cabinet Committee on Economic Affairs (CCEA) seeking approval of the Coal Regulatory Authority Bill, 2012.

The coal regulator, yet to be constituted, will prescribe principles for price determination of the fuel, adjudicate on disputes between parties, and enforce closure of mines.

He emphasised the need to focus on indigenous coal production and not depend on imports from countries like Indonesia, Australia and South Africa.

"At the end of the day, we need to maximise our own production if we are to meet the energy requirement in the future.

"If there is shortage then we import from other countries like Indonesia, Australia, South Africa to make up the shortage. But it is full of risks," said Gupta, adding that the changing policies, frameworks and lack of infrastructural facilities for import increase the risk factors.