Coal block auctions to result in lower power rates, says minister

States with rich coal deposits are going to earn huge revenue as the bidding has been very aggressive

GN Bureau | February 20, 2015


#coal block   #auction   #power   #piyush goyal   #court   #bidding  

Even as the government is looking at bonanza from the coal blocks auction, power minister Piyush Goayl has said that the power tariff will come.

The allocation of coal blocks will fetch a whopping  Rs15 lakh crore over the next 30 years, for the respective states.

Post auctions, the coal minister said that the country would also see the power costs coming down because the benefit of the auction will have to be passed on to the consumers.

“The important thing is that post these auctions (of coal block) there will be three to four very important changes...Overall the entire economy will get a push with adequate fuel reaching these end-use plants,” Goyal told reporters in New Delhi.

The government has put on offer 19 coal blocks in the first lot for auction.  The government is auctioning the coal blocks after the Supreme Court cancelled allocation of 204 mines in September last year.

Indian companies have bid aggressively for coal blocks in the country’s first auction.

GMR Chhattisgarh Energy, Reliance Cement, Sunflag Iron and Steel, CESC, Hindalco Industries, Jaiprakash Associates and BALCO are among the companies that bagged 11 coal mines in the previous four days of auction.

Meanwhile, according to India Ratings & Research (Ind-Ra), developers are quoting negative final price offers in the reverse auction process, for coal blocks earmarked for the power sector, implying zero fuel cost pass-through.

While this is beneficial for the end consumers and the state governments, the same has the possibility of negatively impacting the financial profiles of the developers.

In the reverse bidding, the government sets a ceiling price, which represents the coal cost of Coal India, and the bidders are required to bid lower than the ceiling price. The bidder which has the bid the lowest gets the mine.

The last day for the auction of first lot of mines is February 22.

 

Comments

 

Other News

A portrait of Dom community opens a world not seen by many

Fire on the Ganges: Life among the Dead in Banaras By Radhika Iyengar 4th Estate / HarperCollins, 348 pages, 599

Revamp BMC Engineering Department for better governance, says think tank

Calling for reforms in the Engineering Department of BMC, Mumbai Vikas Samiti, a not-for-profit organisation has said that less than optimum performance of Engineering Function has added to the woes of citizens and deterioration in the quality of life in the metro. In its recently released r

NGO hails Maharashtra move to amend Insecticide Act

Hailing the Maharashtra government for introducing a bill to amend the Insecticide Act, 1968, Pesticide Action Network (PAN) India has called the amendments ‘very  focussed’ and urged the state to expand their scope to address other challenges. The bill, introduced in the a

‘Garba of Gujarat’, now a Unesco Intangible Cultural Heritage

`Garba of Gujarat` has been inscribed in the Representative List of Intangible Cultural Heritage (ICH) of Humanity by UNESCO, under the provisions of the 2003 Convention for the Safeguarding of Intangible Cultural Heritage during the 18th meeting of the Intergovernmental Committee for the Safeguarding of t

Cyber frauds helpline has helped save Rs 930 crore

Since its inception, Citizen Financial Cyber Fraud Reporting and Management System has witnessed more than 12.77 lakh complaints registered (till November 15, 2023), and has saved more than Rs. 930 crore in more than 3.80 lakh complaints. This was stated by minister of state for home affair

COP28 discusses climate resilient development in Himalayas

Impacts and implications of Climate Change Vulnerability in the Himalayan Region and ways of creating ‘Climate Resilient Development in Indian Himalayan Region by making mountain communities green and resilient were discussed the side event hosted at the India pavilion at the UN Climate Conference CO

Visionary Talk: Amitabh Gupta, Pune Police Commissioner with Kailashnath Adhikari, MD, Governance Now


Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter