CIL To Sign Fuel Supply Agreements With Power Plants
In a bid to ensure a continuous supply of coal to the starving power plants, the state run Coal India will sign Fuel Supply Agreements (FSAs) with power plants that have entered into long term Power Purchase Agreements (PPAs) with Distribution Companies (DISCOMS).
“The captive power plants are getting supplies of coal under the applicable Fuel Supply Agreement (FSA) which is different from that of the proposed FSA for power plants having Power Purchase Agreement (PPA) with Distribution Companies (DISCOMS). The applicable FSAs for existing and new captive power plants have trigger level for penalty for short supply at 60% and 50% of Annual Contracted Quantity (ACQ) respectively,” said the statement released by the government.
Meanwhile, with the agreement in place, CIL would pitch in its contribution in case of any shortfall in fulfilling its commitment under the FSAs from its own production. The coal production currently is estimated to meet the demand of the said FSA holders