'Power plants fail to import adequate coal quantum' | business | Hindustan Times
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'Power plants fail to import adequate coal quantum'

Coal minister Sriprakash Jaiswal refused to accept the charge that power production has been dwindling because state-run Coal India Ltd has been unable to supply adequate quantum of coal to the thermal power plants. Jaiswal, in a chat with HT’s Vivek Sinha, instead shifted the blame on power firms.

business Updated: Jul 25, 2012 02:27 IST
Vivek Sinha

Coal minister Sriprakash Jaiswal refused to accept the oft-repeated charge that power production has been dwindling only because state-run Coal India Ltd has been unable to supply adequate quantum of coal to the thermal power plants. Jaiswal, in a free wheeling chat with HT’s Vivek Sinha, instead shifted the blame on power firms and said that quite often (as per contracts) power plants are supposed to import certain quantum of coal which they did not do and hence face coal shortage.

First things first. So let’s begin with power shortage in the country. There have been allegations that coal ministry did not supply adequate quantum of coal to power producers, which ultimately led to electricity shortage….
See, we must understand that if there is a shortfall of coal in power plants then it is not always the case that we have not been able to supply adequate coal to them. The assessment needs to be done from the fact that how much coal have we given them, what has been our agreement about the quantum of coal to be supplied to respective power plants in a year. And if there is a shortfall in coal supplied as per our commitment then the ministry of coal is responsible but if they were supposed to import certain quantum, which they have not done because of high costs (and hence facing coal shortage) then it is not our responsibility.

Quite often power producers say electricity generation is being affected because they are left with coal that can last for only a couple days…
If any power producer says that they are left with coal that will last for only a couple of days, then please ask them how much is the contracted quantity with Coal India and if that is supplied by Coal India then how can we be held responsible. Then they should be held responsible. Yes, there may have been some rare instances when either due to heavy rainfall or unavailability of railway racks we may not have supplied coal but then these are very rare instances.

What about captive coal blocks?

We have given coal blocks to several power companies but why have they not increased coal production from these blocks? Please ask them. In fact we are de-allocating captive coal blocks of those power firms who have knowingly not been able to start production. We have formed an inter-ministerial group that will de-allocate all such coal blocks. There are 58 such coal blocks that has gone to the inter-ministerial group.


What is the way out of this impasse? Why can’t we increase coal production?

Ans: Well, we cannot increase coal production by an indefinite quantum. We can definitely increase production but not to the extent and at the pace by which demand is shooting up. Only last year, Coal India increased production by around 6.5%. We have also speeded up coal evacuation and its offtake.

Let’s talk about coal pilferage. Have you been able to stop theft at coal mines?
You need to understand that law and order is a state subject. If the state government does not take necessary steps then it (theft) will not stop. If we expect that Coal India Ltd can stop theft of coal from all across the country then it is not possible. In places where Coal India companies mine coal, we do stop pilferage. But coal property is spread across several thousands of kilometres and if someone is indulging in illegal mining of coal then it is the responsibility of state government to save its coal property.

What do you have to say on the CAG’s draft report…
Well, coal block allocations started after 1993, wherein every subsequent government wished to increase coal production. So coal blocks were given in government sectors as well as private sectors. All governments gave these coal blocks. The erstwhile NDA government gave away 35 coal blocks and our government gave away 155 coal blocks and in all these coal block allocation, state government’s nod was taken.

But then why has this issue come up?
Ans: See if an audit agency looks into anything it will say something like, …if these things were not to happen then the government could have gained this much and if these things have happened then the government has lost this.

Yet, the CBI is conducting an enquiry into the allocation of coal blocks. What action will you take if CBI reports any wrongdoing?
CBI is verifying whether the screening committee---which has allocated coal blocks---been fed with wrong information. We will take strict action against all those who have doled out wrong feedback to gain coal blocks. In fact, we will cancel all those coal blocks that have been wrongly allocated.

What’s the latest update on TCI?
All decisions on Coal India are being taken according to the terms given in the red herring prospectus made available during the IPO. We had mentioned every thing during the IPO and people purchased shares only after reading the prospectus of Coal India. If anybody (read TCI) had any misconceptions then its their fault not ours. This is a government company and our first and foremost responsibility is to take care of the people of this country. Even after this if somebody goes to court then it is their will. We will face them in the court.

Will you tell TCI to sell their stake in Coal India if they are not satisfied with company’s policy?
They are not kids… if they feel this is not the right investment decision then surely they can sell their stake in the open market. We do not need to advise them. We cannot change our policy for them. Also, we never have hidden any of our policies and changed them after the IPO.