In a significant move at facilitating power generation in the country, the Indian Railways has signed a Coal Transportation Agreement with Nagarajuna Power Corporation Limited (NPCL).
NPCL is setting up a 1015MW thermal power plant near Padubidri near Udipi in Karnataka along the Konkan Railway.
The agreement was signed here on Friday among the Southern Railways, Konkan Railway Corporation Limited (KRCL) and NPCL.  Under the agreement, the coal required for the plant will be transported by rail from the new Mangalore port to the plant covering a distance of about 36 km.
Coal required for the power plant will be imported at the port. While loading of coal and a small lead of five km is in Southern Railway, unloading siding will be in Konkan Railway jurisdiction.  Transportation of 2.8 million tonne per annum of coal will be required for the power house. 
The Railways will get committed coal traffic of 2.8 MTPA for a period of 25 years. The Indian Railways will supply wagons for handling this traffic.  Total 89 rakes per month will be required to be moved. The company will pay additional five  per cent of the base freight charges on each tonne of coal loaded up to annual schedule quantity (28 lakh tonne) in a year.
The company will pay a bonus of five per cent of the freight charges on the additional quantity actually transported over and above the stipulated 26.6 LT in any operating year.
The IR will have to make its best efforts to maintain a stock of 2.85 LT at the powerhouse. If the monthly quantity of coal is less than or equal to 95 per cent, five per cent liquidated damages as a percentage of freight charges will be payable by the Railways.
The Company will create infrastructure facilities at their cost.  A development cess along with freight charges will be paid for development of facilities on Konkan Railway.