Power minister threatens to take back unused mines

Union power minister Sushil Kumar Shinde is threatening strong action against private companies which have not developed coal mines allotted to them for captive use, for over two years.

“Such allotments could even be cancelled,” Shinde said on Thursday at the Energy Summit organised by the Indian Chambers of Commerce.  “Within at least two years of the allotment of captive blocks, companies should start action. Otherwise, I am afraid to say that your coal blocks might be taken back by the government,” Shinde said.

The Union coal ministry has dashed letters to companies, including Steel Authority of India, JSW Steel and Jindal Steel & Power, warning them of “appropriate action” if they do not hasten development of coal blocks allotted to them.

The government has targeted an output of 36 million tonne of coal in 2008-09 from captive blocks, but actual production during the year was only 30 million tonne, a shortfall of 17%.

The coal ministry intensified monitoring of captive coal projects last year, when it was decided that captive units should have a bigger share in growing coal demand in country.

The government has planned to add a capacity of 78,700 megawatts during the XIth Five-Year Plan, out of which about 50,570 mw are expected from the coal-based thermal power projects.

The government is targeting a capacity addition of 12,000 mw through captive plants during the Plan period. According to the latest evaluation made by the government, nearly 66,000 mw of capacity addition is achievable in the 11th Plan. The government is banking on captive power plants to meet shortfall in capacity addition.