The government has relaxed captive coal mining norms to allow power companies to divert surplus coal from one of their projects to another.
Permission will be given on a case-to-case basis to coal-surplus companies that approach the coal ministry, said a senior government official who asked not to be named.
The company’s claim will be verified by the coal ministry before the diversion plan is approved. Permission will be given to only those power projects that are awarded on the basis of tariff-based bidding.
However, the regulations bar power companies from selling surplus coal to other companies as only government-owned entities are allowed to trade in coal. Allowing private sector companies in trading will need an amendment to the Coal Mines (Nationalisation) Act, 1973.
The current norms require captive coal mines to hand over excess coal to the central government, which disburses it through Government held Coal India. In some special cases, the coal ministry permits sale of excess coal on a temporary basis.
Till now, 198 captive coal blocks have been allocated by the coal ministry. Only 21 of these blocks are operational so far. Captive mining was allowed to give a fillip to coal production in the country as the government expects a demand-supply mismatch. Planning Commission has estimated a shortfall of 60 million tonnes by 2012.
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