Coal India likely to consider FSA with power companies on July 10.

The state-run Coal India Limited (CIL) is expected to take up the issue of Fuel Supply Pacts (FSAs) to be signed with power firms on July 10 with the Prime Minister’s Office intervening in the deadlock between the two sides.

The PMO’s intervention came as CIL and power companies, including state-owned NTPC, are at loggerheads over certain clauses in the FSAs which were to be completed months back and has been adversely affecting the power generation due to low coal supplies.

The Prime Minister’s Principal Secretary Pulok Chatterjee today held a meeting with Secretaries of Coal and Power to take stock of the situation and address the differences, particularly relating to the quantum of assured supplies of coal to the power companies. CIL Chairman S Narsing Rao was also present, sources said.

As per the original understanding, CIL was to supply at least 80 per cent of the committed quantity of the requirements of the power firms. The CIL was not comfortable with this, citing reasons like production constraints, and wanted it to be reduced.

The meeting today is believed to have reached an understanding that CIL could supply between 65 and 80 per cent of the requirement of power companies, for which FSAs would be signed.

This matter is now expected to be taken up by the CIL Board meeting on July 10, sources said.

NTPC and many power companies have refused to ink fuel supply agreements (FSAs) with CIL, disagreeing with the introduction of new clauses in the pact.

So far, only 27 power plants including that of Lanco, Reliance and Adani, of 48 in all, have signed FSAs with the state-run coal giant.

Source: The Economic Times

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