New Delhi, Feb 17 (IANS): The ongoing auction of coal blocks whose existing allotments were cancelled by the Supreme Court has been yielding "exemplary results" and will lead to lower power tariffs, Finance Minister Arun Jaitley said Tuesday.
"History has provided us a second opportunity for the power sector, and the professional way in which (Coal and Power) Minister Piyush Goel has been going on the coal policy is evident from the auctions. The last four days have given exemplary results," Jaitley said addressing the valedictory session of the three-day 'First Renewable Energy Global Investors Meet and Expo (Re-Invest)' here.
"With the roadmap charted by him (Goyal) for the sector, the auctions will moreover result in lower electricity tariffs," he added.
The auction is on the basis of tariff based reverse bidding where the end-use is power generation, and forward bidding for production of steel, cement and generation of power for captive use.
While the criteria for calculating the floor price for bidding is based on state miner Coal India's (CIL) price of coal of the same grade, the auction also has a ceiling price for power sector bidders to keep the lid on power tariffs.
Earlier, Coal Secretary Anil Swarup said that auction trends indicated that revenue could be as high as Rs.15 lakh crore.
Poor states, which are home to most of the country's coal resources, are poised to benefit from the ongoing auction of coal blocks, he tweeted.
"Coal block auction gets underway on the fourth day," Swarup said.
"Windfall in offing. Poor states to reap harvest of coal block auctions," he added.
Coal blocks worth Rs.11,839 crore have been auctioned, which signifies an annual income of Rs.6,853 crore for states like Odisha, Madhya Pradesh, West Bengal, Maharashtra, Jharkhand and Chhattisgarh, Swarup said.
The mines up for auction Tuesday are Amelia (North) in Madhya Pradesh reserved for the power sector where the lowest bidder will win, and Ardhagram mine in West Bengal and Chotia mine in Chhattisgarh -- both being earmarked for the non-regulated sectors.
Reliance Cement and GMR Group won the two blocks on offer on the first day of auctions.
The government has put 19 blocks on sale in the first lot. The last day for the auction of first lot of mines is Feb 22. The Supreme Court had in September last year cancelled the allotment of 214 mines allotted between 1993 and 2010.