Coal minister Piyush Goyal wants output cap raised for coal mines under automatic route.

NEW DELHI: Coal minister Piyush Goyal has proposed raising the production ceiling for existing mines identified for ramping up output without seeking fresh environmental clearance with the aim of saving some $1.8 billion a year spent on imports but equipment shortage may prove to be a stumbling block.

India imported over 80 million tonnes of coal last fiscal. Nearly 50 million tonnes of the imports went to meet shortfall in supplies from state-run monopoly Coal India, which produced some 475 million tonnes against a target of 562 million tonnes.

Power production has been hanging precariously for years as growth in fuel supplies failed to keep pace with rising demand and rapid expansion of coal-fired generation capacity. The UPA-2 government's dogmatic approach towards granting green nod for opening new mines only exacerbated the problem by setting the clock back by several years.

During its last days, however, it tried to hasten coal production by devising the "automatic route" with a ceiling for select mines to raise production without holding public hearings, a process that is often misused by vested interests to delay projects.

Government sources said Goyal has now suggested to his counterpart in the environment ministry, Prakash Javadekar, measures to improve upon this policy with a target of ramping up production by 32 million tonnes in 2-3 years. India's coal shortage is estimated to hit 350 million tonnes in 2016-17.

Goyal has suggested automatic green nod for mines with a capacity of 8-16 million tonnes capacity be allowed to raise output by 4 million tonnes plus 25% of 8 million tonnes capacity. For mines with 16 million tonne-and-above capacity, the coal minister has suggested an enhanced ceiling of 6 million tonnes plus 15% of 16 million tonnes capacity.

Sources said Javadekar has asked officials to examine how best the coal ministry's proposal can be implemented without compromising on green norms. "A section within the ministry is still pitching for fresh green nod, saying the matter will be processed quickly keeping power sector's urgency. Simply bypassing the green norms may unnecessary attract litigation," an official familiar with the discussions said.

Sources in coal companies say even if the government operationalises the new policy, the shortage and poor condition of existing equipment could be a deal-breaker. Equipment makers can take up to nine months for delivering dumpers and excavators or draglines, they said.

Source : timesofindia.indiatimes.com