The state government has sought allocation of about 58.30 million tonne per annum (MTPA) coal from the Union ministry of coal for its proposed six thermal power projects to be set up over the next four-five years. However, with the Centre remaining non-committal to State’s coal requirement, uncertainty looms large over these projects.
Getting domestic coal for these projects is not an easy task as the Group of Ministers (GoM) headed by Union Finance Minister Pranab Mukherjee is yet to take a decision on coal block allotment to future power projects in the country. Besides, the coal ministry is struggling to get clearances from Ministry of Environment and Forests (MoEF) for its coal blocks as the latter had imposed ban on mining in many coal-rich areas.
Sources in the coal ministry told Deccan Herald that, even if the MoEF lifts the ban, the Centre is keen to allot the coal blocks only through auction by doing away with the existing system of directly allotting fossil fuel. This will force the state power utilities to bid for blocks vying with other states.
With the MoEF insisting that receipt of coal linkage from the Ministry of Coal is a must for giving environment clearance, the state’s projects may not see the light of the day until it gets coal linkage. Besides this, lenders are pressuring the states to get coal linkage before sealing pact on financial closure.
Currently, Karnataka’s coal requirement is 80 lakh tonne per annum of which 14 lakh tonne is being imported and the rest supplied by Coal India.
“For the current power production, we have sufficient coal. But we urgently need commitment from the Centre for our future projects,” Karnataka Power Minister Shobha Karandlaje said.