SHAKTI: Coal linkage policy named SHAKTI or the Scheme to Harness and Allocate Koyla (Coal) Transparently in India.
Salient Features of the policy
This policy will award fuel supply agreements to coal plants already holding letters of assurance (LoAs). It is issued to new consumers on being approved by the appropriate authority, based on recommendation of a committee constituted Specific terms & conditions of the LOA to be complied with within a stipulated time period for being eligible to enter into FSA for commencing coal supply.
Thermal plants holding LoAs will be eligible to sign fuel supply pacts under the new policy after ensuring that all the conditions are met.
Coal linkages would be awarded to state-owned power distribution companies (discoms). These, in turn, would assign linkages to
state or central power generation companies via allocation, and
Private units through auction.
The independent power producers (IPPs) participating in the auction will bid for discounts on the existing tariff and this would be adjusted from the gross coal bills.
Power plants will have to give discount on their tariffs to get linkages. This could lead to under-recovery by the units, but it is still better than no fuel supply.