[av_heading heading=’Power companies that win coal contracts with the Coal India BSE -0.85 % Ltd (CIL) in the forthcoming auctions will have to ensure that they sign long and medium-term contracts for power supply with discoms within two years’ tag=’h3′ style=’blockquote modern-quote’ size=” subheading_active=’subheading_below’ subheading_size=’15’ padding=’1′ color=” custom_font=”][/av_heading]
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| Power companies that win coal contracts with the Coal India BSE -0.85 % Ltd (CIL) in the forthcoming auctions will have to ensure that they sign long and medium-term contracts for power supply with discoms within two years.
Coal supplies to the power plants will start only after they sign the power contracts. The Cabinet Committee on Economic Affairs (CCEA) is likely to consider the new coal contracts policy for power plants in its next meeting. The clause was required to ensure misuse of coal, said a senior government official. However, private power companies call the clause unfair as discoms have not been floating power requirement tenders regularly. They say the proposed auctions will put winning companies at a disadvantage when they compete for bagging power supply tenders floated by state distribution companies. “Signing power purchase agreements (PPAs) is not in the control of the power companies. There have not been many long-term contracts in the last seven years and looking at the low demand, subdued price of power in the market and falling prices of renewables, the probability of signing PPAs is very low. Source – economictimes.indiatimes.com |
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