The Revised SHAKTI Policy 2025, which promotes transparency and flexibility by streamlining coal allocation for thermal power plants

Concerning the Updated SHAKTI Policy 2025:

Ministry of Coal (MoC) and Ministry of Power (MoP) are the nodal ministries.

Goals: Assure demand-driven, adaptable, and transparent coal allocation.

Encourage the planning of long-term thermal power capacity.

Promote the replacement of coal imports and streamline logistics.

Make deeper power markets and market-driven electricity pricing possible.

Important Aspects of the Updated SHAKTI Policy

Two-Window Design

For Central/State Gencos and IPPs with Power Purchase Agreements (PPAs), Window-I (Notified Price) applies.

Coal is distributed by tariff-based bidding or nomination.

Any power generation, including imported coal-based (ICB) plants, is eligible for Window-II (Premium Basis). PPA is not necessary. the ability to sell power via bilateral agreements or markets.

Essential Changes and Notable Features

Simplification: The earlier 8 coal linkage categories are now consolidated into only two windows.

No PPA Mandate (Window-II): Allows plants to freely trade power in power exchanges or through contracts.

Support for Private Sector: Enhances Independent Power Producers (IPPs) and private funding in thermal industry.

Assistance for Greenfield and Brownfield Initiatives: Particularly in proximity to pithead sites for economical benefits.

Import Substitution: ICB facilities can transition to local coal, minimizing foreign exchange expenditure.

Coal Optimization: Decreased landed expense and streamlined rail logistics lower ultimate tariffs.

Flexibility for FSA Holders: Eligible to bid for coal exceeding annual quota through Window-II.

Market Connections: Facilitates the sale of excess electricity in energy markets, improving market fluidity.

Empowered Committee: Led by the Secretaries of Power and Coal, along with the Chairperson of CEA, to quickly address implementation challenges.

No Extra Costs: No financial pressure on coal companies.