Shinde concerned as CIL dilutes FSAs with power firms

Power minister Sushilkumar Shinde may seek the intervention of the prime minister's office to force Coal India Ltd to quash the new fuel supply pacts, which relieve the state-run miner of most of its supply obligations.

According to The Economic Times, a senior government official said that Shinde is likely to write to the prime minister's principal secretary, Pulok Chatterjee, seeking directions to state-run CIL to sign the old fuel supply agreements (FSAs) with a commitment to supply 80 per cent of the plants needs with agreed quantity.

In February, the prime minister's office (PMO) had asked Coal India to sign 20-year FSAs with power plants that have inked long-term power purchase pacts with distribution companies and are ready to generate electricity by end-March. When CIL.

However, power companies are now refusing to sign the new FSAs, saying they are tilted in favour of the miner and absolve it of all commitments. So far, only 13 of the expected 50 power units have signed the pact.

"We will take up the issue with both the coal ministry and the PMO," power secretary P Uma Shankar said on Wednesday. "We will write to the coal ministry after we receive a report from Central Electricity Authority (CEA), which is compiling presentations made by various companies," he added.

On Wednesday, representatives of power companies including NTPC, Reliance Power, Lanco Infratech and Damodar Valley Corp met CEA chairperson AS Bakshi, who advised them to convey their concerns in writing.