Coal India Allows Sale Of Surplus Power In Open Market From August

In a bid to increase coal demand and make electricity more affordable, Coal India Ltd. has started allowing power plants using its coal to sell extra electricity in power exchanges from Aug. 1, officials said. Earlier, power generators with long and medium-term fuel supply agreements (FSAs) from CIL were permitted to supply power only under existing power purchase agreements (PPAs).

The revised policy now enables the sale of un-requisitioned surplus (URS) power in the open market, under the provisions of the updated SHAKTI scheme, officials added.

'This will help the power sector meet consistent demand for affordable electricity,' a senior CIL official said.

The move covers all power generators — central and state utilities, as well as independent power producers — with long or medium-term FSAs, both existing and future, the official said.

With more surplus power flowing into exchanges, spot prices are expected to stay in check, he added.

Last August, CIL had allowed TPPs to procure coal beyond 120% of their Annual Contracted Quantity (ACQ), removing a long-standing cap.

In FY26, CIL has committed about 650 million tonnes of coal under FSAs for the power sector.

Experts said recent steps by the miner will help spur coal demand by power and non-power consumers.