NEW DELHI: The government on Friday approved CoalSETU (Coal Seamless, Efficient & Transparent Utilisation) — a new auction window that will allow industries to buy coal on a long-term basis without any end-use restrictions.
Explaining the decision, Information and Broadcasting Minister Ashwini Vaishnaw said the CoalSETU window has been added to the existing Non-Regulated Sector (NRS) Coal Linkage Auction Policy of 2016. Under this new provision, any domestic industrial consumer can participate in the auction, although coking coal will not be offered. The current NRS policy, coal linkages are auctioned only to specific sectors such as cement, steel, sponge iron, aluminium and others (excluding urea fertilizer units), including their captive power plants. These linkages are restricted to specific end uses.
Coal purchased through the CoalSETU window can be used for self-consumption, coal washing, export, or other permitted activities, but cannot be resold within India. Companies will be allowed to export up to 50% of their allotted coal and may use it flexibly across their group companies.
Additionally, the new window provides long-term coal linkages for any industrial purpose or export, but traders will not be allowed to participate. The existing NRS auctions for specified end-use industries will continue, and those industries may also bid in the new window.
Vaishnaw added that the policy is expected to increase the availability of washed coal by allowing washery operators to secure coal linkages. This is likely to reduce coal imports and create new export opportunities for washed coal.