The Coal India board on Wednesday cleared the conditions for signing the fuel supply agreement (FSA) with NTPC, which was pending for more than a year. Both the PSUs have agreed to bury the supply dispute, which was holding the back the FSAs.
CIL chairman S Narsing Rao said, “We are in position to sign the FSA with NTPC. The contentious issues have finally been resolved. The board has cleared today and I understand they (NTPC) have also cleared the FSA.”
The NTPC board on Tuesday decided to the sign the FSA laying down conditions that it would incentivise for 25% of coal below 3,100 kilo calorie, while also accepting coal below that calorific value. Coal below 3,100 kcal would be accounted separately.
NTPC has given the condition of starting third party sampling before September 30 and also said that auto mechanical samplers, wherever installed should be made operational in a time bound manner.
NTPC would sign the FSA with CIL subsidiaries for plants generating a total of 9,370 mw and installed after March 2009. Rao on Wednesday said CIL has agreed that incentives would be reduced if coal supplied was below the calorific value of 3100 kcal.
On the issue of supplies to old and new units, CIL would be eligible for incentives only if supplies were more than 90% of the annual contracted quantity (ACQ) to old units and 80% of the ACQ to the new units, Rao said.
NTPC was supposed to sign FSA for 30,000 mw capacity but it has agreed to sign FSA for 9,370mw.
