NEW DELHI: State-owned Coal India Limited (CIL) on Tuesday announced that it will allow thermal power plants and independent power plants (IPPs) to receive coal supplies beyond their Annual Contracted Quantity (ACQ).
The company said the move will increase CIL's volume sales and simplify the supply process. Previously, CIL had a provision allowing coal supplies up to 120% of ACQ to power plants. Now, the limit has been removed, enabling power plants to lift higher quantities of coal beyond their stipulated ACQ.
“Focusing on increasing its volume sale of coal, Coal India Limited (CIL) has paved the way for allowing supplies beyond Annual Contracted Quantity (ACQ) to thermal power plants of the country including independent power plants (IPP). This applies to the Gencos which have signed the fuel supply agreements (FSA) embedded with such an enabling clause,” said CIL in a press note.
This decision is expected to benefit power plants that prefer to lift higher quantities of coal and will also boost CIL's supplies during a period of slackening coal demand. The company's pitheads currently have a coal stock of 72 million tonnes, a 47% increase compared to last year. In FY 2024, CIL supplied a record 619.7 MTs of coal to coal-fired plants, meeting 101.6% of the projected demand. This represents a 5.4% growth compared to FY 2023.
CIL has long-term linkages with 127 domestic coal-based power plants and 50 IPPs, accounting for 592 MTs and 155.7 MTs per annum, respectively. During FY 2024, domestic coal-based power plants generated 1177 billion units, with approximately 78% of this generation fueled by CIL's coal.
This policy change is expected to usher in ease of doing business, simplicity and avoid duplication of work, further solidifying CIL's position as a leading coal supplier in the country.