Coal News We love to talk!

APR 15 2013

Energy content in ECL coal lower by 30%, finds CIL study

  • Economic Times, ET Bureau / Hyderabad
  • Created: Mon 15th APR 2013

There is a variance of between 15% and 30% in the energy content of the coal supplied by Eastern Coalfields Limited (ECL) to NPTC's thermal power stations at Farakka and Kahalgaon and the bill amount raised, a joint testing by Coal India, and NTPC has shown.

The result of the testing conducted last week spells bad news for Eastern Coalfields as the sample shows a quality that should be priced between Rs 460 per tonne and 550 per tonne. Eastern Coalfields bills the coal at Rs 640 per tonne, an amount that has been hotly contested and reduced by NTPC leading to a standoff for four days beginning April 1 when the subsidiary of Coal India, stopped coal supply. ECL says dues worth Rs 1,000 crore are pending.

Following the escalation of tension and disruption of supply, the oil ministry interceded and asked the three sides, Coal India, Eastern Coalfields and NTPC to conduct joint testing of the coal supplied. Now both Coal India and NTPC have agreed to conduct the sampling on a regular basis for the next few weeks.

Ailing Eastern Coalfields was forced to pay salaries by liquidating fixed deposits as cash inflows reduced. Variance in energy content and the samples will mean decline in income for the same volume of coal supplied. The reduction in income according to the first set of samples will vary between Rs 90 and Rs 180 per tonne of coal supplied. This may delay the turn around of the company.

However, this may turnout to be good news for power consumers as NTPC is bound to pass on the reduction in cost of generation to clients, mostly state utilities in Bihar, West Bengal and some of the northern states. Preliminary estimates suggest cost of power may decline by at least 70-80 paise per unit.

Tags

PTC India Limited Bihar West Bengal Kahalgaon Thermal Power Plant Stage-I Coal NTPC Ltd Eastern Coal Fields India

Related News

  • Jaiprakash Power Ventures sells the family silver  Read more
  • Tata Power can't terminate contracts unilaterally: NTPC  Read more
  • Tata Power keen to generate more from renewables  Read more
  • Over 1 Crore Led Bulbs Distributed in UP under UJALA programme  Read more
  • Solar power cos funding struggle slows transition to green tech  Read more
  • India seeks better LNG deal by teaming up with South Korea and Japan  Read more
  • Note recall likely to make solar energy cheaper in the long run  Read more
  • Future powerhouse, Arunachal Pradesh suffers from power crisis  Read more
  • Vodafone, TCS, L&T, TechM in fray for 5 million smart meters tender  Read more
  • Nine states asked to 'immediately' implement Forest Act  Read more