CCEA approves revised SHAKTI scheme for allocation of coal to power plants

The Cabinet Committee on Economic Affairs on Wednesday approved the revised Scheme for Harnessing and Allocating Koyala Transparently in India (SHAKTI) for allocation of coal to the power sector to help them meet long-term and short-term coal requirement.

The approval was given by the Cabinet Committee on Economic Affairs (CCEA) chaired by the Prime Minister Narendra Modi, in a move aimed at simplification of the linkage process.

The CCEA "has approved grant of fresh coal linkages to thermal power plants of central sector/state sector/independent power producers (IPPs)," the coal ministry said in a statement.

With the introduction of Revised SHAKTI (Scheme for Harnessing and Allocating Koyala Transparently in India) Policy, two windows --- coal linkage to central gencos/states at notified price and coal linkage to all gencos at a premium above notified price -- have been proposed.

The ministry further said 'under coal at notified price' segment the existing mechanism for grant of coal linkage to central sector thermal power projects (TPPs) including joint ventures (JVs) and their subsidiary will continue.

Moreover, coal linkage earmarked to states may be utilized by states in its own genco, Independent Power Producers (IPPs) to be identified through Tariff-Based Competitive Bidding (TBCB) or existing IPPs having Power Purchase Agreement (PPA) for setting up of a new expansion unit under 'coal at notified price' window.

Under the 'premium over notified price' segment, any domestic coal-based power producer having PPA or untied and also Imported coal-based power plants (if they so require) can secure coal on auction basis for a period upto 12 months or for the period of more than 12 months upto 25 years.

The Central Sector Thermal Power Projects (TPPs) shall continue to get coal linkage on nomination basis on the recommendation of Ministry of Power, whereas, the linkages earmarked to the States on nomination basis on the recommendation of Ministry of Power may be utilized by the States in the State Generating Company, the statement added.