Govt allows import of coal with higher ash content

New Delhi: The Centre Monday allowed power plants to use imported coal with higher ash content of up to 25 percent, a move which will allow power producers to source the dry fuel from more countries and cut generation cost.

Power producers were demanding review of the ash-content restriction for efficient utilisation of high grade, low-moisture coal imported from Australia, South Africa and Russia.

The Environment Ministry, in February 2013 order, had restrained ash content in imported coal up to 12 percent which, the Association of Power Producers said, forced power plants in the coastal region to use only Indonesian coal.

"It has now been decided that the ash content in imported coal for ultra mega power projects (UMPPs) shall be 25 percent maximum subject to ... Conditions," the Environment Ministry said its latest order.

The imported coal-based UMPPs using coal with ash content 12 percent should conduct annual study to analyse the actual ash content and assess pollution load. The study report in this regard should be submitted to the ministry, the order said.

"Based on the findings and outcomes of three such studies, the decision shall be further reviewed, if found necessary," it added.

The decision has been taken based on the recommendation of the ministry's Expert Appraisal Committee (EAC).

The committee had observed that bulk of the imported coal having ash content lower than 12 percent are typically of Indonesian origin having high moisture content of about 30-40 percent, while imported coal from Australia, Russia, the USA and Columbia have ash content of about 25 percent with moisture content up to 15 percent.

The Committee had further noted that lesser the ash generation, the lesser would be its environmental impact. However, by restricting the ash content up to 12 percent, the source of coal gets restricted to a particular origin and thus the price competitiveness may have to be compromised.