Shinde writes to PMO over new coal supply pact

Shinde writes to PMO over new coal supply pact

As the uncertainty over coal supplies continues, the Power Ministry has sought the Prime Minister’s Office (PMO) intervention to resolve the issues related to Coal India’s new fuel supply agreement.  

With most of the power producers having reservations about certain clauses, including those related to penalty in the revised Fuel Supply Agreement (FSA) put forward by Coal India (CIL), Power Minister Sushilkumar Shinde has written to the PMO seeking intervention on the issue.

The minister’s letter came after the Central Electricity Authority (CEA) held discussions with various power generators on May 9 to gather their views on the FSA problem.

According to sources, the minister has requested the PMO to instruct the Coal Ministry and CIL to sign FSAs within a month based on the 2009 format.

Last month, the government had issued a directive asking CIL to ink FSAs with an assurance for minimum 80 per cent fuel supply to power plants.

However, power producers have said various conditions in the new FSA such as on penalty and bringing ordinary business difficulties under force majeure are not acceptable.

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