Advisory Group suggests opening up of coal sector for higher domestic production

Opening up of the coal sector and upgradation of Coal India (CIL), the state-run miner, and its subsidiaries are vital for scaling up domestic production of the fuel, says a report submitted to the government on Monday.

The Advisory Group for Integrated Development of Power, Coal, and Renewable Energy presented its final report for suggesting measures for enhancement of coal production in the short, medium and long term to Power and Coal Minister Piyush Goyal.

The group, headed by Suresh Prabhu, who is now Union Minister for Railways, has called for certain improvements in CIL and its subsidiaries including Central Mine Planning and Design Institute Limited (CMPDI).

The Advisory Group's report has emphasised on the need for opening up the coal sector to supplement the domestic production of state-run miner Coal India and a few other companies.

The report touched upon the issues of the 'Coal Block Auction Process', 'Coal Linkage Rationalisation' and 'Swapping of Coal Linkages', while stressing on the need for urgent action on coal linkages to power plants already commissioned, and likely to be commissioned by March, 2015.

"Various options should be explored to develop Railway Infrastructure from Coal Mines to main Railway System including through a JV Company on Infrastructure by CIL," it said.

The report also called for expediting reforms in the distribution sector with targeted actions including privatisation or PPP (public private partnership) in distribution. "There is also a need for enhanced role of and improvements in working of CEA (Central Electricity Authority), Amendments to Electricity Act, Tariff Policy and Standard Bidding Documents," it said.

Among various other suggestions, the group said the transmission constraints needed to be addressed.

The Advisory Group was set up by the government on June 25, 2014.

The Group chaired by Prabhu, consists of RV Shahi (Former Power Secretary), Pratyush Sinha (Former Chief Vigilance Commissioner), Anil Baijal (Former Home Secretary), Partho Bhattacharya (Former CMD Coal India, among others, as members.

The government has already announced plans to augment CIL's production to an annual 1 billion tonnes by 2019. CIL accounts for about 80 per cent of total domestic coal production.