Coal India to pilot new billing system with NTPC

The new billing mechanism will compute prices on every unit of Gross Calorific Value (GCV) of coal, doing away with the grade policy at present.

The GCV unit-based pricing of coal was first announced by Gopal Singh in January this year, when he was holding temporary charge as chairman of Coal India.

Singh had expected the rollout of the new pricing method from April this year.

"It has not started yet. It entails lot of things and that's why we are not in a hurry. Consumers should also agree. We are planning to carry out a pilot soon with NTPC," Coal India director (marketing) S N Prasad told PTI.

The trial will be conducted with 1-2 plants of NTPC and 1-2 mines of Coal India in the first round.

"After 2-3 months, we will analyse the results before taking a call on rollout in full scale," he said.

If the initial results are positive then the new pricing will cover all the NTPC plants in the second round before extending the new billing system to all consumers,

Prasad said.

He said the pilot project will help the miner understand teething problems.

Coal India had also met the stakeholders to deliberate on the proposed pricing mechanism and claimed that most of them had supported it.

Asked why the rollout of the new pricing mechanism has been delayed, a senior official of Coal India said it is a major reform involving all the mines and requires a cautious approach.

You pay exactly what quality you get. For each GCV, 48 paisa will change either upward or downward from the median of each grade that the company has proposed," Gopal Singh had explained earlier.

Coal India has 17 grades -- from 2000 to 7000 GCV -- with difference of 300 GCV between two grades.

Coal India expects the new mechanism to bring down corruption and leave a positive impact on coal production.

Earlier, mining workers were not encouraged to cross a grade which was difficult but all miners will now be encouraged to produce more, Singh had said earlier.