Press Information Bureau
Government of India
Ministry of Power
27-August-2012 18:34 IST
Government Takes Several Steps to Bring Reforms in Distribution Sector
The Minister of State, Shri K.C. Venugopal, in a written reply informed the Rajya Sabha today that the Power Sector is presently facing several issues such as availability of adequate fuel, financial viability of Distribution Companies (DISCOMs), time taken in getting environment and forest clearances, right of way (ROW) issues etc. However, efforts are being made to resolve these issues in consultation with the various stakeholders. The minister further said that to ensure availability of coal to power projects, it has been decided that Coal India Ltd. (CIL) will sign FSAs with power plants that have entered into long-term Power Purchase Agreements (PPAs) with DISCOMs and have been commissioned or would be commissioned on or before 31st March, 2015. The FSAs will be signed for full quantity of coal mentioned in the Letters of Assurance (LoAs) for a period of 20 years with a trigger value of 80% for levy of disincentive and 90% of levy of incentive. In case of any shortfall in fulfilling its commitment under Fuel Supply Agreements from its own production, CIL will arrange for supply of coal even through imports. Government has taken several steps to bring reforms in Distribution Sector including unbundling of State Electricity Boards and formation of State Electricity Regulatory Commissions. Meetings are held regularly with Ministry of Environment and Forests to expedite the environment and forest clearances for power projects, he added.