Draft Cabinet note for auctioning coal linkages to be out soon

The Coal Ministry will soon move a draft Cabinet note for auctioning linkages for the dry fuel to the power sector.

This assumes significance in the backdrop of the government's commitment to provide affordable round-the-clock electricity to all.

"The Coal Ministry will soon seek suggestions of various ministries including power on the draft Cabinet Committee on Economic Affairs (CCEA) note for auction of coal linkages to the power plants," a source said.

Last month, CCEA had approved allocation of coal linkages for non-regulated sector only through auction. Sectors included were cement, steel/sponge iron, aluminium, and others (excluding fertiliser, urea).

Coal and Power Minister Piyush Goyal has said that the framework attempts to make coal available in a fair manner to end-users.

"Proposed auction methodology leads to price through a market mechanism; it does not seek to maximise revenue", the minister had said, adding, "it ensures that all market participants of non-regulated sector have a fair chance to coal linkage, irrespective of size".

Coal Secretary Anil Swarup had said that coal linkages for 24 million tonnes will go under the hammer in the first year.

Till now, Standing Linkage Committee has been deciding on allocation of long-term and short-term linkages for the sectors, including power and steel.

The government aims to provide 24x7 power by 2019 by creating cost-effective infrastructure which will be sustainable and inclusive of clean energy solutions.