Talwandi Sabo thermal plant nears completion; coal supply yet to be assured

07 March, 2013

The coal supply to 1980 MW Talwandi Sabo thermal project has not yet been assured though the project is likely to be commissioned in next few months.

Sterlite Energy Limited (SEL) is facing difficulty in signing fuel supply agreement (FSA) as the condition of Coal India Limited’s (CIL) model FSA, disallows change in ownership after issue of Letter of Assurance (LoA). Mahanadi Coalfields limited (MCL) has refused to sign the FSA as the 1980 MW thermal power project was transferred from Punjab State electricity board to Sterlite Energy under the provisions of case 2 tariff-based International Competitive Bidding Process.

It may be mentioned that as per Letter of Assurance issued by MCL, it will supply 7.72 million tons of E grade coal per annum for the project. The coal supply guaranteed by MCL was up to 5.00MT during 2011-12 and 7.70MT from 2012-13 onwards. SEL has stressed the need of an early signing of FSA as the project is in its last stages of completion.

Meanwhile, the efforts of streamlining the coal testing procedure at its thermal plants are yielding result. PANEM supplied 55 coal rakes at Ropar thermal in February. During testing at thermal plant it was found that 39 rakes were of E grade, 10 of D grade and 6 of F grade.

According to official sources, there are still chances of improvement. The coal sampling needs to be given to competent persons. There is a staff shortage in testing laboratories at thermal plants.

According to sources, PSPCL is planning to outsource the coal testing to a private party. A party has reportedly given its consent to do third party testing. The move to outsource the coal testing may prove costly for the utility.

Coal India (CIL) is also the other major coal supplier to the Ropar thermal plant. It dispatched more than 408200 metric tons of coal in February. Coal India has requested the PSPCL authorities for deputing the staff at coal loading end for joint sampling for testing purpose.