Coal India ready to sign modified FSA with power firms
Kolkata: Public sector Coal India Limited (CIL), the world's largest coal miner, Tuesday said it is now ready to sign the modified Fuel Supply Agreement (FSA) with power firms on the cost-plus basis as its board approved the final draft of the model.
The coal miner said it is waiting for customers' responses on price pooling mechanism as the model has been referred to Central Electricity Authority (CEA) and independent power producers (IIPs).
"Now price pooling mechanism is in the process. As of now if any power firm comes to sign an FSA, then it will go by the cost-plus basis unless and until the price pooling is finalised," CIL chairman S. Narsing Rao told media persons after the company's board meeting here.
The cost plus model provides imported coal at its actual cost.
CIL's director (personnel) R. Mohan Das informed that the board finally approved the draft of the modified FSA with a cost-plus formula.
"From tomorrow onwards if some firm come, we would be ready to sign the FSA with them," he said.
The coal miner was waiting for the customers' response on price-pooling, he added.
As per the presidential directive, the coal major has to meet 80 percent trigger level. The company said the 80 percent trigger level would be maintained with 65 percent of domestic coal and 15 percent of imported coal.
The state-run firm agreed to pay penalty of 1.5 percent to 40 percent on failing to supply the committed quantity of coal to the power utilities, following protests from major companies over its decision to go for a paltry penalty of 0.01 percent.