NTPC buries differences with Coal India; agrees to sign FSAs
New Delhi: After refusing to sign pacts to buy coal over quality issues, state-run power utility NTPC today said it will sign the fuel supply agreements with Coal India but with certain riders.
The country's largest power producer has said that the company's Board has approved signing of Fuel Supply Agreements (FSAs) with Coal India for 9,370 MW capacity plants and the sampling will take place at the loading point.
"NTPC will accept coal quality below 3,100 kilocalorie but will incentivise Coal India for 25 percent of that quantity and the remaining will not be incentivised," NTPC CMD Arup Roy Choudhury told PTI.
Coal supplied below 3,100 kilocalorie will be accounted for separately.
"Coal India informed that the third-party sampling and analysis at loading end shall be introduced before September 30, this year," Choudhury said.
Auto Mechanical Samplers wherever installed and not operational shall be made operational in a time-bound manner.
The company will sign the FSAs for the power stations which came up after March 2009.
The company had earlier said that it has agreed on almost all terms and conditions of the FSAs and was ready to sign the agreements provided Coal India promised to give a minimum calorific value coal.
It had also said that the coal which was supplied by the coal major was of extremely poor quality.
The boilers of the power plants of NTPC are designed to handle coal of minimum 3,100 kilocalorie and inferior quality would have impact on the machinery.
NTPC which requires 160 million tonnes of coal during the current fiscal will import 16 million tonnes on its own.
"We will import 16 million tonnes of coal in the current financial year as mandated by our ministry," he said.
Choudhury said: "Coal India is now planning to acquire mines abroad. Over a period of time they will be able to bring cheaper imported coal and then NTPC will start taking that coal from them."
NTPC at present generates over 41,000 MW of electricity.
The Prime Minister's Office in a directive last year asked the Coal India to quickly sign the FSA with NTPC after its November, 2012 deadline was missed.
Earlier, the government had issued a Presidential Directive to Coal India to sign FSAs with the power producers assuring them of at least 80 percent of the committed coal delivery.