E-Auction of coal may be rewired soon

KOLKATA: Coal e-auction may soon be back from ashes. The committee formed by the Centre to evolve a policy for coal distribution has found e-auction a suitable system for determining market price of the fuel. It is likely to submit its report in favour of the system in two weeks.

The committee was formed under the chairmanship of central coal secretary HC Gupta, following the Supreme Court’s direction to temporarily discontinue e-auction. “We are giving final touches to the report. It will be submitted to the ministry in two weeks,” Mr Gupta told ET.

Senior officials close to the development said, “The committee will suggest introduction of floor prices for e-auction instead of a reserve price, which was the practice earlier. The present system of e-booking has limitations. Buyers end up getting just 50 tonnes. Further, the system is dependent on availability of a broadband connection, which is not common in non-metros.”

Interestingly, the TL Shankar committee report on Coal India (CIL) also suggested the company introduce e-auction of coal.Currently, CIL sells a portion of its production through e-booking where bidding is done for quantity instead of price, as was the case with e-auction. E-auction is an electronic bidding mechanism through which coal was being sold to the highest bidder. This resulted in substantial price realisation to CIL over its notified prices.

In any case, NCCF and state government agencies had to pay 20% over the notified price. Non-linked consumers, however, were paying average e-auction prices. They will now pay 20% over the notified price.