Lok Sabha Question No. 2390 (UNSTARRED), answered on 2022-03-16
Subject: Coal Block Auction
Ministry: COAL
Asked by: Rakesh Singh

## GOVERNMENT OF INDIA MINISTRY OF COAL

## LOK SABHA

## UNSTARRED QUESTION NO - 2390

TO BE ANSWERED ON 16.03.2022

## COAL BLOCK AUCTION

## 2390. SHRI RAKESH SINGH:

Will the Minister of Coal be pleased to state:

(a) whether the Government has amended the law for coal block auction in the country and if so, the details thereof;

(b) whether the arrangements for supply of coal to the private sector and electricity sector has been made at par;

(c) if so, the details thereof;

(d) whether the demand of domestic coal would increase as a result of it; and

(e) whether the coal likely to be made available to the electricity sector through e-auction of coal which would be costlier in comparison to the existing procedure and if so, the details thereof?

## ANSWER

## MINISTER OF PARLIAMENTARY AFFAIRS, COAL AND MINES (SHRI PRALHAD JOSHI)

(a): Amendments have been made in the Coal Mines (Special Provisions) Act, 2015 [CMSP Act]  and  the  Mines  and  Minerals  (Development  and  Regulation)  Act,  1957  [MMDR  Act] through  Mineral  Laws  Amendment  Act,  2020  enacted  on  13.03.2020  to  ensure  wider participation and competition in auction of coal mines. The amendments in the Acts would enable the following:

-  Allocation of coal blocks for composite prospecting license-cum-mining lease which will help in increasing of the inventory of coal/lignite blocks for allocation.
-  Repetitive and redundant provision requiring previous approval of Central government even in cases where the allocation or reservation of coal/lignite block has been made by the Central Govt. itself has been done away with.
-  Provided flexibility to the Central Govt. in deciding the end use of Schedule II and III coal mines under the CMSP Act.
-  Companies which do not possess any prior coal mining experience in India can now participate in auction of coal blocks.

(b) & (c): Presently linkages are granted to Power plants according to the various provisions of SHAKTI policy dated 22.05.2017 and amendment dated 25.03.2019 issued by Ministry of Coal.

The  non-power  sector  consumers  are  presently  awarded  linkages  through  Nonregulated Sector linkage auction policy dated 15.02.2016 issued by Ministry of Coal.

Beside  the  above  avenues,  the  power  and  non-power sector  consumers can procure coal under e-auctions, conducted by coal companies, as per their requirement.

(d):  Demand of domestic coal is dependent upon various factors like position of economy, international coal price & sea freight, seasonal variation etc.

(e):  Power  sector  consumers  are  primarily  provided  coal  through  linkages  to  the  extent  of 100%  normative  requirement  against  power  purchase  agreements  on  the  price  based  on notified price for power sector. For any additional coal requirement, the power plants may source their coal through e-auction.

Moreover, due to the high price of International Coal, the domestic as well as importbased power plants imported less amount of coal during the current Fiscal resulting in less generation from import-based power plants. On the other hand, domestic coal-based power plants generated as per their programme with a growth of 16 % over last year same period.