You are here: Home » Economy & Policy » News
Business Standard

Coal price rise means costlier power, warns MahaGenco

Sanjay Jog  |  Mumbai 

Maharashtra State Power Generation Company (MahaGenco) says it would have to pay an extra Rs 201 crore yearly, due to the 10-15 per cent rise in supply rates from Western Coalfields Ltd (WCL, a Coal India arm.

The rise announced by WCL is for the entire western region. “The rise was made when pricing was shifted to a Gross Calorific Value (basis) from (the earlier) Useful Heat Value basis,” said a WCL official. “Due to the power ministry’s demand, the hike was rolled back.” The roll back had been reversed, he said.

Mahagenco has an installed capacity of 6,980 Mw. A company official told Business Standard, “We spend nearly Rs 9,000 crore annually for procuring 38 million tonnes (from WCL and other CIL subsidiaries), of which coal linkage from WCL (meaning, the amount it is supposed to supply) is 20.8 mt. The outgo purely to WCL comes to Rs 3,800 crore.”

Warned MahaGenco managing director Subrat Ratho, “This rise will make the power tariff (rate) unviable, especially for industries in Maharashtra. The maximum impact will be on industrial consumers.” This is important, notes the MD, since industrial consumers cross-subsidise the rates charged for other categories of consumers. He said it would be difficult to give the exact rise likely, as a result, in rates.

The MahaGenco official said of the total coal linkage of 38.6 mt, it had got only 29 mt during 2011-12. Subsequently, MahaGenco contracted for 3.35 mt of imports, at the advice of the Central Electricity Authority. “Of the 20.8 mt linkage from WCL, we received 16 mt. During 2012-13, the linkage from WCL is also 20.8 mt. We have been rigorously pursuing our case for the supply of good quality coal without any interruption,” he said.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Fri, June 29 2012. 00:47 IST
RECOMMENDED FOR YOU
.