The
new pricing policy of CIL may have minimal impact on the regulated sectors,
largely power but non-regulated sectors such as cement, iron and steel,
aluminium, paper and many others should feel the pinch.
Initial
estimates suggest that prices of C and D grade coal will experience a sharper
rise under the new formula, expectedly boosting revenues of Central and
Northern Coalfields.
The
prices of low-ash A and B grade coal which were already linked to international
prices will be least affected. The E and F grades, mostly consumed by power
stations, will experience some upward movement.
The New pricing method might make the the Linkage price equal to the Auction prices approximately, said Industry experts
According to
sources, the new pricing formula continued with the practice of dual pricing
for regulated and non regulated sectors so as to ensure that the power sector
is least affected. While CIL sources expect that the dual pricing, coupled with
minimum movement in the E and F sectors, to have minimum impact on cost of coal
for power sector, there are concerns that the old-generation power stations
linked to good quality coal may witness a rise in fuel cost.
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