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There has been no resolution so far to the issue of assured fuel supply from Coal India Limited (CIL) to power producers. According to reports, while CIL released a model supply agreement in April 2012, so far only around 13 Fuel Supply Agreements (FSAs) have been signed. Originally around 50 power units were expected to sign FSAs with CIL. Power producers have objected to the model FSA released by CIL, particularly its force majeure provisions and the dilution of financial penalties in case of lower than contracted supply. Background The adverse power supply situation has attracted greater attention in the past few months. According to Central Electricity Authority's data, the gap between peak demand and peak supply of power in March 2012 was 11 per cent. The decreasing availability of fuel has emerged as a critical component of the worsening power supply situation. As of March 31, 2012, there were 32 critical thermal power stations that had a coal stock of less than 7 days. The gap between demand and supply of coal in the past three years is highlighted below: Table 1: Coal demand/Supply gap (In millions of tonnes)
2009-10 |
2010-11 |
2011-12 |
|
Demand |
604 |
656 |
696 |
Supply |
514 |
523 |
535 |
Gap |
90 |
133 |
161 |
Source: PIB News Release dated May 7, 2012 Coal accounts for around 56 per cent of total installed power generation capacity in India. Increased capacity in thermal power has also accounted for almost 81 per cent of the additional 62,374 MW added during the 11th Plan period. Given the importance of coal in meeting national energy needs, the inability of CIL to meet its supply targets has become a major issue. While the production target for CIL was 486 MT for 2011-12, its actual coal production was 436 MT. Fuel Supply Agreements In March 2012, the government asked CIL to sign FSAs with power plants that have been or would be commissioned by March 31, 2015. These power plants should also have entered into long term Power Purchase Agreements with distribution companies. After CIL did not sign FSAs by the deadline of March 31, 2012 the government issued a Presidential Directive to CIL on April 4, 2012 directing it to sign the FSAs. The CIL board approved a model FSA in April 2012, which has not found acceptance by power producers. According to newspaper reports, many power producers have expressed their dissatisfaction with the model FSA released by CIL. They have argued that it differs from the 2009 version of FSAs in some major ways. These include:
Most power producers, including NTPC, the country’s biggest power producer, have refused to sign the new FSA. Reports suggest that the Power Minister has asked the Prime Minister’s Office to mandate CIL to sign FSAs within a month based on the 2009 format. CIL has received a request from NTPC to consider signing FSAs based on the same parameters as their existing plants, but with the revised trigger point of 80 per cent (down from 90 per cent earlier). Underlying this situation is CIL’s own stagnating production. Various experts have pointed to the prohibition on private sector participation in coal mining (apart from captive projects) and the backlog in granting environment and forest clearances as having exacerbated the coal supply situation.
The Protection of Women against Sexual Harassment Bill was passed by Rajya Sabha yesterday. Prior to this, no legislation specifically addressed the issue of sexual harassment at the workplace. In 1997, the Supreme Court issued directions in Vishakha vs. State of Rajasthan to deal with the issue. The Supreme Court had also recommended that steps be taken to enact a law on the subject. The Bill was introduced in Parliament in 2010 and was passed by the Lok Sabha on September 3, 2012. In order to protect women from harassment, the Bill establishes a mechanism for redressal of complaints related to harassment. Recently, the Verma Committee in its Report on Amendments to Criminal Laws had made recommendations on the Sexual Harassment Bill. In this blog we discuss some of the key issues raised by the Verma Committee with regard to the issue of sexual harassment at the workplace. Internal Committee: The Bill requires the establishment of a committee within organisations to inquire into complaints of sexual harassment. The Committee shall comprise four members: three would be employees of the organisation; and the fourth, a member of an NGO committed to the cause of women. The Verma Committee was of the opinion that in-house dealing of the complaints would dissuade women from filing complaints. It recommended that a separate Employment Tribunal outside the organisation be established to receive and address complaints of sexual harassment. Requirement for conciliation: Once a complaint is made, the Bill requires the complainant to attempt conciliation and settle the matter. Only in the event a settlement cannot be reached, the internal committee of the organisation would inquire into the matter. The Verma Committee was of the opinion that this is in violation of the Supreme Court’s judgment. It noted that in sexual harassment cases, an attempt to conciliate compromises the dignity of the woman. Action during pendency of the case: As per the Bill, a woman may approach the internal committee to seek a transfer for herself or the respondent or a leave to the complainant. The Verma Committee had recommended that till the disposal of the case, the complainant and the respondent should not be compelled to work together. False complaints: The Bill allows the employer to penalise false or malicious complaints as per their service rules. The Committee was of the opinion that this provision was open to abuse. A PRS analysis of the Bill may be accessed here.