Cabinet may approve coal linkage policy for power sector today

After the approval for sectors like cement, steel, aluminum and captive power producers, the Union Cabinet is likely to take coal linkage policy for power sector, Aseem Manchanda Zee Business reports. 

The approval will lead to assured coal supply for regulated sectors. 

Experts believe that if approved, the policy will bring transparency and end ambiguity over fuel supply for the power sector. 

Unlike earlier, when the coal allocation used to be on the basis of government recommendations, the new auction methodology will be based on demand-supply market mechanism.

In February this year, Coal Secretary, Anil Swarup has said that the government will soon come out with a linkage auction policy for power sector. The government is trying to supply more coal to power companies to ensure that they replace import demand with domestic supplies, LiveMint reported.