Gujarat CM writes to Goyal on supply of inferior coal by CIL arm

Says it is impacting the utilities to the tune of Rs 400 cr per year

Complaining of inferior coal being supplied to its power plants, the Gujarat Government has asked the Centre to resolve the issue, saying it is impacting the utilities to the tune of Rs 400 crore per year.

In a letter to Coal and Power Minister Piyush Goyal, Gujarat Chief Minister Anandiben Patel sought "suitable" action to sort out the issue.

"Utility has to pay more cost for the coal while receiving the lower grade and resulting into high generation cost. This carries implication of Rs 400 crore per annum," she said.

The Chief Minister also suggested there could be third party inspection of the coal, both at the loading and unloading point, being supplied from Korea-Rewa Coalfields of South Eastern Coalfields Ltd (SECL), a subsidiary of Coal India (CIL).

"Coal received from Korea-Rewa has...Variation in grades between coal received at power station and coal billed by SECL (South Eastern Coalfields Ltd)," Patel said in a recent letter to Goyal.

She also said the price of different grades of coal was not uniform with respect to its Gross Calorific Value (GCV).

"Higher grade coal price should not be more than 25 per cent than average coal price. Grade G1-G5 shall not be supplied to power plants unless specifically requested for," the letter said, adding correct declaration of grade of coal was required.

The Power Ministry had earlier alleged that stones and boulders were still being dispatched to the power plants along with coal.

The issue of fuel quality being supplied to the power plants had also cropped up in the presentation on coal sector earlier made to the Prime Minister Office.

Goyal had earlier said that to address the issue of fossil fuel quality, third party sampling and analysis facilities at loading ends have been introduced, and the process is being further streamlined.

The issue of coal quality last year had resulted in a stand off between the country's largest power producer NTPC and the world's largest coal producer CIL.

After the government intervened on the matter, it was decided that a third party mechanism would be introduced to check coal quality to NTPC.