Lok Sabha Question No. 4206 (UNSTARRED), answered on 2016-08-11
Subject: Financial Support to Power Plant
Ministry: POWER
Asked by: P.R. SUNDARAM

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.4206 TO BE ANSWERED ON 11.08.2016

## FINANCIAL SUPPORT TO POWER PLANT

4206. SHRI P.R. SUNDARAM:

Will the Minister of POWER be pleased to state:

- (a) whether  the  Government  proposes  to  increase  the  financial  and logistic  support  for  Thermal  Power  Stations  in  the  country,  if  so,  the details thereof and the decisions taken by the Government in this regard;
- (b) whether the steep rise in price of coal and other raw material and machineries  used  in  Thermal  Power  stations  has  gone  uncontrollable,  if so, the details thereof and the reasons therefor; and
- (c) the remedial steps being taken by the Government in this regard?

## A N S W E R

THE MINISTER OF STATE (INDEPENDENT CHARGE) FOR POWER, COAL, NEW & RENEWABLE ENERGY AND MINES

( SHRI  PIYUSH GOYAL )

(a) : Following  actions  have  been  taken  by  the  Government  to increase the financial and logistic support for thermal power stations in the country:

- (i) The Government, on 04.05.2016, approved the proposal for allowing flexibility in utilization of domestic coal amongst power generating stations to reduce the cost of power generation. Under the scheme, the  Annual  Contracted  Quantity  (ACQ)  of  each  individual  coal linkage  as  per  Fuel  Supply    Agreement,    is  to  be  aggregated  as consolidated  ACQ  for  each  State  and  Company  owning  Central Generating  Stations  instead  of  individual  generating  station.  The State/Central  Gencos  would  have  flexibility  to  utilize  their  coal  in most efficient and cost effective manner in their own power plants as well as by transferring coal to other State/Central Gencos Power plants for generation of cheaper power.

..........2.

- (ii) Government  has  notified  policy  guidelines  for grant of  Bridge Linkage  to  specified  end  use  plants  of  Central  and  State  Public Sector Undertakings which have been allotted coal mines or blocks. Bridge  linkages  applications  for  public  sector  power  projects  in prescribed formats have been approved.
- (iii) Subsequent  to  the  cancellation  of  Coal  Blocks  by  the  Hon'ble Supreme Court order dated 24.09.2014, nine Coal Mines linked  to End  Use  Power  Plants  totaling  to  9,940  MW  have  been  allotted through e-Auction to the winning bidders. In addition to the above, thirty-eight  coal mines for linked End Use Power Plants totaling to 40,090 MW capacity have also been allotted through e-Allotment to Central/State Sector utilities.
- (iv) Policy has been issued for automatic transfer of coal linkage/Letter of  Assurance  (LoA)  granted  to  the  old  plants  while  scrapping  and replacing  them  with  new  plants  of  supercritical  technology  in respect of State and Central sector Power plants.
- (v) Further,  Government  has  also  approved  a  scheme  to  revive  and improve  utilization  of  the  stranded  gas  based  power  generation capacity in the country which has been lying idle or under-utilized due  to  shortfall  in  the  domestic  production  of  natural  gas  in  the country, by supply of Spot Re- Gasified Liquefied Natural Gas (RLNG) (e-bid  RLNG)  to  both  Stranded  power  plants  and  plants  receiving domestic gas selected through         e-reverse e-bidding process. The other concessions envisaged under the scheme include-custom duty  waiver  on  imported  LNG;  waiver  of  Value  Added  Tax,  Central Sales Tax, Octroi and Entry Tax; waiver of Service Tax on regasification and transportation; reduction in pipeline tariff charges,  regasification  charges  and  marketing  margin;  exemption from transmission charges and losses for stranded gas based power projects  &  support  from  Power  System  Development  Fund  (PSDF), Government of India, if required.
- (b) : No,  Madam.
- (c) : Does not arise.

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