Lok Sabha Question No. 1238 (UNSTARRED), answered on 2017-02-09
Subject: Higher Freight Cost on Coal
Ministry: COAL
Asked by: CHANDRAKANT RAGHUNATH PATIL

## 1238: SHRI C. R. PATIL:

Will the Minister of COAL be pleased to state :

(a) whether Gujarat is on the Western Coast of the country and is at a distance of more than 1600 kilometers from the Eastern coal belt;

(b) if so, whether as a result of this, the freight cost on coal is higher than the actual coal cost resulting into higher cost of generation of power and if so, the details thereof;

(c) the steps taken by the Government to reduce cost of coal and burden to import coal and rationalization of coal linkage;

(d)  whether  the  Government  has  taken  any  steps  to  allocate  more  coal  to  State Government/Gujarat  State  Electricity  Corporation  Limited  keeping  in  view  the  huge requirement of coal by GSECL; and

(e)  the  steps  initiated  regarding  swapping  of  coal  to  Government  of  Gujarat/GSECL keeping in view that domestic coal may be handled over at mine and imported coal at port and swapping to be based on heating value terms based on third party sampling and analysis at loading end ?

## A N S W E R

## MINISTER  OF  STATE  (I/C)  IN  THE  MINISTRY  OF  COAL,  POWER,  NEW  AND RENEWABLE ENERGY AND MINES

## (SHRI PIYUSH GOYAL)

(a) & (b): Yes, Madam. While the price of G-12 grade of coal of SECL or MCL is Rs. 760 per tonne, the rail  freight  for  transporting  coal  to  a  distance  of  1600  Kms  is  Rs. 2133.40 per tonne.

(c): In order to reduce import of coal, coal companies have been advised to improve domestic coal production. Further, to reduce import of high grade coal, Coal India Ltd. (CIL) has taken various steps for import substitution, including offering high grade coal through  linkage  to  FSA  holders  and  through  various  e-auctions,  special  forward  eauction, flexi tenure of lifting, reduction of Earnest Money Deposit and reserve price to cater to requirement of various consumers including Thermal Power Plants (TPPs) not

## GOVERNMENT OF INDIA MINISTRY OF COAL LOK SABHA UNSTARRED QUESTION NO.1238

## TO BE ANSWERED ON 09.02.2017

## 'Higher Freight Cost on Coal'

having Fuel Supply Agreement (FSA). Source rationalisation of National Thermal Power Stations (NTPC) and its Joint Ventures (JVs), Tangedco, NTPL, Tuticorin, NTECL Vallur have  been  done.  Allocation  of  additional  high  grades  of  coal  through  MoU/FSA  to NTPC, Tangedco and NTPL, Tuticorin have been done towards import substitution. In the current year (2016-17) till 31.12.2016, indicative import substitution by FSA holding consumers of CIL has been to the tune of 12.8 MT (Provisional). As part of coal linkage rationalisation,  overall  movement  of  40.536  MT  of  coal  has  been  rationalised  with annual potential savings of Rs.2,503.50 cr.

(d): In view of the comforatble coal stock,Thermal Power Plants (TPPs) of Gujarat have preferred to consume coal from their stock and have occasinally regulated coal lifting. In the current year (up to 31.12.2016), coal lifting under FSA by TPPs of Gujarat has been 9.51 MT  against FSA  commitment of 16.42 MT  (Provisional), which is  58% materialization.

(e): For swapping of coal linkage, an agreement was signed between GSECL and NTPC  to  the  effect  that  1  MTPA  of  coal  from  SECL  (Korea-Rewa  field)  would  be supplied to NTPC, Seepat plant and in lieu of that GSECL will take imported coal of NTPC.  Swapping  is  based  on  mutually  agreed  terms  including  heat  value  of  coal. Further, sources of GSECL have been rationalized by transfer of 1.2 MT from SECL to WCL.

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