India's Coal Ministry assures NTPC of more supplies via e-auction

India's Coal Ministry said it would make efforts to supply more coal through electronic auction route to power producer NTPC, whose generation had been hit due to acute shortage of the dry fuel.

“We will try to make available more coal to NTPC through e-auction,” Coal Minister Sriprakash Jaiswal said.

Coal distribution through e-auction, a process where the dry fuel is sold at market price, was introduced to provide access to coal for such consumers who are not able to source it through available institutional mechanisms due to seasonality of requirement, limited needs not warranting long-term linkage, etc.

Around 10 per cent of the total coal produced by state-run Coal India, which accounts for 80 per cent of the domestic coal production, is sold through e-auction. The minister, however, said no relaxation in pricing would be provided to NTPC through e-auction.

Replying to a question, the minister also said that the problem of coal supply to power stations would be resolved in 48 hours. “Within 48 hours all problems would be solved,” he said.

Yesterday, the government had asked coal companies, including major producer Coal India, to step up supply to power stations facing shortage of the dry fuel to ensure that the power generation was uninterrupted.

Earlier in the day, the Power Ministry said it has asked the Coal Ministry to provide supplies for power projects before going ahead with e-auction. “e-auction [of coal] should be resorted to after they [producers] meet the requirement of the power sector,” Power Secretary P Uma Shankar said.

Reacting to the development, the Director General of the Association of Power Producers, Ashok Khurana said, “We welcome this first step from the government, this will help mitigate the immediate coal crisis.”