New Delhi: Power consumers after the auction of 19 coal blocks stand to gain over Rs 30,000 crore over a period of time by way of a cut in electricity tariff, said Power and Coal Ministry Piyush Goyal.
According to official estimates, auction of coal blocks will fetch over Rs 1 lakh crore, including royalty, to six states.
On the sidelines of an event, ‘Budget Aaj Tak, Goyal told reporters, said, “The first round of coal block auctions for 19 mines will fetch the government over Rs 1.3 lakh crore of which over Rs 30,000 crore will be savings from reduction in power tariff.” In the reverse bidding adopted for coal auction, government had set a ceiling price that was representative of production cost of Coal India. The private sector companies, which are considered more efficient, were expected to bid at lower price.
In case the bids touch zero, meaning that the private producer is ready to pass on the benefit of coal extraction to power consumers, there would be a forward bidding. Of the total 204 coal blocks whose allocation was cancelled by the Supreme Court in September 2014, 19 were auctioned in the first tranche that concluded.
