Cabinet approves offering of coal via common e-auction window

The government on Saturday approved offering of dry-fuel by coal companies, including state-owned CIL, through a common e-auction window instead of sector-specific auctions.

The approval was given during a meeting of the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi.

In a statement, the Coal Ministry said CCEA has approved "offering of all the non-linkage coal by coal companies through one e-auction window of CIL (CIL)/Singareni Collieries Company Ltd. (SCCL)." Due to the move, market distortions would be removed and single rate for all the consumers will evolve in the e-auction market. It will increase operational efficiencies and lead to an increase in domestic coal demand.

Besides, the discretion presently vested in coal companies for allocating coal to different end-use sectors will be eliminated. Further, the coal companies will be able to establish coal gasification plants by availing coal from their own mines.

It shall help in developing clean-coal technology in the country, it added.

This e-auction will cater to all the sectors, namely power sector and non regulated sector (NRS), including traders. Coal would be offered through this auction in place of the present system of sector-specific auctions.