Prelims: Current events of national and international importance | Energy
Why in News?
The domestic coal production crossing one billion tonnes for 2 consecutive years and private sector participation expanding significantly since the launch of commercial coal auctions in 2020.
Coal meets nearly 55% of the country’s primary energy requirements and contributing more than 70% of electricity generation.
India possesses the world’s 5th-largest coal resources and is the second-largest producer and consumer of coal globally.
Around 5 lakh mine workers are engaged in coal production across more than 350 mines.
The Coal Mines (Special Provisions) Act, 2015 subsequently established a statutory framework for the reallocation of coal blocks through transparent auctions.
In 2020, the commercial coal mining was launched.
The reform allowed companies to sell coal freely to any consumer at market-determined prices, removing the earlier restriction that coal could only be used for captive purposes.
The new regime also replaced the fixed per-tonne payment system with a revenue-sharing model under which successful bidders pay the government a percentage of their revenue linked to the National Coal Index.
It also allows 100 per cent foreign direct investment through the automatic route.
