MISSION SHAKTI - NEW COAL ALLOCATION POLICY FOR THERMAL POWER PLANTS



  • SHAKTI1 (Scheme for Harnessing and Allocating Koyala Transparently in India) is a policy designated by the Union Government for the allocation of coal among thermal power plants in a transparent and objective manner.


  • The main objectives of this policy are to make coal available to all the Thermal Power Plants of the country in a transparent and objective manner and at the same time ensure that the benefits of linkage coal are transferred to the end consumers.


  • It thus bodes well not just for the infrastructure sector but also for the public sector banks which have crores of rupees lying unpaid in loans given to the power companies.


  • Allocation of linkages (buying coal from a mine closer to the power plant) for power sector shall be based on auction of linkages or through Power Purchase Agreement (PPA) based on competitive bidding of tariffs except for the State and


  • the Central Power Generating companies. The Companies which do not have coal linkages at present, would benefit immensely from the new policy as they would get domestic fuel supplies at competitive rates through auction.


  • With this policy, the Government also aims to reduce dependence on imported coal


MISSION SHAKTI - Salient Features of SHAKTI



  • The salient features of the SHAKTI are as follows:


  • New and more transparent auction-based coal linkage policy.


  • Thermal Power Plants (TPP) having Letter of Assurances shall be eligible to sign Fuel Supply Agreement after ensuring that the plants are commissioned


  • The allocation of linkages for power sector shall be based on auction of linkages or through Power Purchase Agreement (PPA) based on competitive bidding of tariffs


  • Policy directions will be issued by the Ministry of Coal and Ministry of Power and will be implemented by Coal India Limited/Singareni Collieries Company Limited and different power entities of the State and Central Government


  • The new policy prescribes direct linkage allocation to public-sector plants and reverse auction for supply of coal linkages to private players


MISSION SHAKTI - Benefits of the Policy



  • The benefits of this policy are as under:


  • Coal available to Power Plants in transparent and objective manner


  • Auction to be made the basis of linkage allocations to IPPs


  • The stress on account of non-availability of linkages to Power Sector Projects would be eased which is good for the Infrastructure and Banking Sector


  • Direct benefit of reduction in tariff by PPA holders would go to Discoms/consumers


  • Power Plants would get long term security of supply of coal from a source of their choice