Tata Power vs NTPC & DVC: CERC rules distribution companies be billed on the grade of coal received at power plants

Power distribution companies will get to save money on the electricity they buy since the regulator has asked generating companies to bill consumers on the basis of coal received at the plants rather than coal dispatched by state-run monopoly miner Coal India Ltd. The Central Electricity Regulatory Commission also asked power generators to disclose details of coal invoices and bills to the distribution companies and put it up on their websites.

In a case filed by Tata Power Delhi Distribution Ltd against NTPC and Damodar Valley Corporation, the power regulator said the distribution companies should be billed on the grade of coal that is received at the power plants and not on grade of coal that is dispatched by Coal India.

“Billing to the beneficiaries (distribution companies) shall be done strictly in accordance with GCV (gross calorific value) on as received basis,” the CERC said in an order issued on February 23. The commission asked the generating companies to take up the issues pertaining to poor quality of coal supply by Coal India with the ministries of power and coal, besides the miner.

“The outcome of the decision of the government and coal companies with regard to wide variation between coal as billed and coal as received on account of grade slippage be placed on record of the commission,” the CERC said.

The government had in November 2015 approved empanelling of independent agencies to check the quality of coal supplied by Coal India to power firms. The coal ministry authorised Central Institute for Mining and Fuel Research to empanel third-party sampling agencies through a transparent process.

Power companies including state-run NTPC have been complaining about supply of poor quality coal or low-grade coal by Coal India. Under the new guidelines, the independent sampler will collect four samples, one each for the buyer and Coal India, one for sampling and one for referral.

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