The Centre has put Orissa government?s plans to get 33% free power from coal reject-based power plants on hold. The coal ministry has asked Orissa government not to hold up any clearances for coal blocks on the basis of such condition till a proper policy is formulated in this regard in consultation with the power ministry.
“We have told them to speed up the clearances for coal blocks. There is a huge shortage of coal in the country and there has to be faster approval for new allocatees,” a coal ministry official said.
The power plants are based on either coal fines or coal reject. The coal rejects have very low calorific value. The state government had announced that any company, be it steel, power or cement, setting up a power plant based on coal rejects coal after washing it, needs to supply 33% of the total power to the state government for free. The condition has become a major deterrent for companies applying for coal blocks. At a recent meeting, coal allocatees had raised concerns about delayed land acquisition and grant of mining leases due to state government’s insistence on supplying 33% reject-based free power.
The state government is now reworking on this policy. An Orissa government confirmed the development. “The policy is under review. The government (state) will take a call. Even if implemented, it will not be retrospective, which means it will be only for new projects,” said an official, who did not want to be named.
The government has allocated 195 coal blocks so far, while the mining plans for another 126 coal blocks have been approved. Of the allocated, 39 blocks are allocated to government-owned companies for commercial use.
