NEW DELHI: The Government on Thursday announced outright cancellation of licence given to leading public and private power utilities, including NTPC, three years ago for exploration of over 40 coal blocks as they had failed to undertake the exercise.

The Power Ministry took the decision in consultation with the Coal and Mines Ministry. The blocks would be allocated to other players, Power Secretary R.V. Shahi said.

The Government would import 20 million tonnes of coal in 2006 to partly meet the domestic requirement against the projected shortage of 30 million tonnes, he said addressing the eighth Energy Summit of the Associated Chambers of Commerce and Industry of India (ASSOCHAM) here.

The Government would add 40,000 MW to the existing installed capacity. Financial closure for some mega projects to the tune of 15,000 MW was already reached. Financial closure for other projects of 5,000 MW was under way. "Those are good power projects with good tie-ups."

Mr. Shahi rebutted the criticism that it would not be possible for the Government to make a capacity addition of 40,000 MW by the end of the 10th Plan period. Power utilities were executing projects to achieve the desired objective, he said.

To a query by ASSOCHAM president Mahendra K. Sanghi, Mr. Shahi said that in 2005 the Government decided to import 14 million tonnes of coal.

Coal would remain a large feedstock for electricity generation because of non-availability of other fuels for the purpose. Policymakers would encourage coal imports as reserves, which were in abundance, should not be completely exhausted, he said.

Conversion efficiency

Power Minister P. M. Sayeed said the Government would explore various technologies to improve conversion efficiency and mitigate the environmental impact. Improving conservation efficiency would mean using less coal per unit of power generated and a reduction in the environmental impact would follow.

The country's nuclear capabilities would sooner or later have to play a significant role in the energy mix.

"Once we have succeeded with thorium, we would be well placed to have a very large nuclear energy programme with energy independence, based on domestic fuel," the Minister said.

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