Coal sector awaits quality norms, better output in 2016

New Delhi: After auctions to the tune of over Rs 3 lakh crore, coal sector is looking for key reforms in the New Year in areas like quality checks as also the steps for augmenting output and rationalising the prices.

"2016 will be important in terms of rolling out of three things -- one is with regard to crushing of coal, the second is the preparatory work regarding washing and putting in a new regime for quality (checks)," "Coal Secretary Anil Swarup told PTI in an interview. 

January onwards, it has been proposed to supply crushed coal to consumers of the fossil fuel including power plants. Besides the government is also planning to put in a new regime for determining the quality of coal being supplied to the consumers, including power producers. 

"From January 1, we should be able to supply 100 per cent crushed coal to all set of plants which are not based at the pit-heads. So crushed coal will travel now below 100 mm," Swarup said. 

Crushing reduces the overall top-size of the run-of-mine coal so that it can be more easily handled and processed within the captive power plants. "There will be a third-party assessment. It will start getting rolling in January or February next year." 

The government is also committed to provide washed coal from October, 2017 in view of environment-related concerns. Coal washing is a process of separation on the basis of difference in specific gravity of coal and associated impurities like shale, sand and stones to get relatively pure marketable coal without changing its physical properties. 

Asserting that it would be the government's endeavour to see that the coal prices are rationalised, the Secretary said that there are some issues with regard to the pricing of fossil fuel. 

State-run Coal India Ltd (CIL) is presently discussing the matter, he said, while adding that "hopefully a decision would be taken with regard to price rationalisation also." 

Stating that price rationalisation is the domain of Coal India, the government has said the coal PSU is considering the matter since a lot of issues have been raised in this regard. The government had earlier said there was a need to rationalise the prices of certain grades of coal as per gross calorific value (GCV) but there was no need to align them to international rates. 

"The other important aspects that could happen in 2016 would be in the context of UDAY scheme for revitalisation of discoms where coal will continue to play a very important role both in terms of rationalisation of linkages both distance linkage as well as efficiency linkage. These will play an important role," Swarup said.

Highlighting the achievements of his Ministry during 2015, Swarup said the year began with clearing up of the coal block allocation mess and following up on the order of the Supreme Court in this regard. 

To begin with it was a tough job, as a lot of mines were cancelled, but the Ministry did "pretty well" on the task of preparing a roadmap and rolling out the auction. "It was task number one which was apparently well done," he said.