Auctions a CIL bid to exploit stressed plants: Power companies
NEW DELHI: Private power producers have alleged that upcoming coal auctions for stressed power plants is an attempt by Coal IndiaNSE -3.80 % to maximise profits as a state monopoly by exploiting the plight of fuel-starved projects.
Pressure from lenders and desperation for coal may force stressed projects to make aggressive bids at the coal auctions, they said. Also, there are high chances of these projects losing bank guarantees if there is no demand from discoms in two years, power producers said.
According to auction rules, bank guarantees of Rs 1 crore per 100,000 tonnes of coal supply to be submitted by selected bidders will get forfeited if they fail to sign power purchase agreements (PPAs) in two years.
