Wedoany.com Report-May 8, India’s Cabinet Committee on Economic Affairs, led by Prime Minister Narendra Modi, has approved a revised policy to improve coal access for thermal power plants operated by central and state sectors, as well as independent power producers. The decision, announced by the Ministry of Coal, aims to enhance energy supply efficiency across India.
The updated Scheme for Harnessing and Allocating Koyala Transparently in India (SHAKTI) introduces two distinct mechanisms for coal allocation. The first mechanism maintains the existing system, providing coal linkages to central sector thermal power projects, including joint ventures and their subsidiaries, at the standard notified price. The second mechanism allows all domestic coal-based power producers with power purchase agreements, untied producers, and imported coal-based plants to secure coal through auctions at a premium above the notified price.
A Ministry of Coal official stated: “The revised SHAKTI Policy ensures equitable access to coal resources, supporting the operational needs of thermal power plants while maintaining transparency in allocation.” This approach is designed to meet the diverse requirements of India’s energy sector without imposing additional costs on coal companies.
The policy revision reflects India’s commitment to optimizing its energy infrastructure by streamlining coal distribution to power producers. By maintaining the existing linkage system for central sector projects and introducing a flexible auction-based system for a broader range of producers, the policy aims to balance accessibility and market efficiency. The inclusion of imported coal-based plants in the auction system further expands the scope of coal availability.
The SHAKTI Policy update is expected to support India’s growing energy demands by ensuring a reliable coal supply for thermal power generation. It aligns with efforts to enhance the operational capacity of power plants nationwide, contributing to a stable and sustainable energy framework. The policy’s transparent allocation mechanisms are designed to foster fairness and efficiency in the energy sector, benefiting both producers and consumers.
