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Home News Power Sector News Private generators slam CIL on offering favouritism to PSUs

Private generators slam CIL on offering favouritism to PSUs

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CILPrivate power producers have alleged that Coal India Ltd (CIL) is discriminating against them and offering coal to government-run firms such as NTPC on relatively easier terms. Association of Power Producers (APP) said that CIL had different fuel supply agreements (FSAs) for private companies and the favoured government-owned generating stations.

The model FSAs for private power companies does not have any provision for arbitration while the draft pacts for public sector companies provide for negotiation mechanism as per government guidelines.

CIL has a unilateral right to terminate coal supply pacts if there is a non-agreement between the seller and buyer during joint reviews while state-run companies can seek government help in such cases.

Private power companies have been asked to submit certificates from central and state electricity regulators confirming they have supplied power to distribution companies. No such requirement has been stipulated for public sector undertakings.

Also the private companies have been asked to submit fresh security deposits while the government-owned electricity companies can adjust the already deposited guarantees against the required security deposit.

APP director general Ashok Khurana said: "The discrimination in the FSAs between government-owned generating stations and private producers has no precedents. Introducing the concept of differential FSAs now is contrary to the principle of natural justice - equality of treatment. This would not stand the scrutiny of law."

Power secretary P Uma Shankar said the Electricity Act 2003 does not make any distinction between public and private sector generating companies. "If that is the case, we will definitely take up the issue with CIL," he told reporters. He said the power ministry is already taking up some issues including quality of coal being supplied by CIL with the coal ministry.

Source- TOI


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