Coal supplies procured through the CoalSETU window can be utilised by an entity for its own consumption (industrial use), exports and washing. However, the commodity cannot be resold within the country.
In a significant development on December 12, the Cabinet Committee on Economic Affairs (CCEA) approved the Policy for Auction of Coal Linkage for Seamless, Efficient & Transparent Utilisation (CoalSETU) by creation of a window — CoalSETU.
This assumes significance as NRS industries such as cement, steel, sponge iron and captive power units are a critical component of the infrastructure sector. Long-term coal linkages without end use restrictions were a long-standing demand.
The Ministry, last week, finalised the modalities and regulations related to the CoalSETU window.
Amended policy
This is part of the amended non-regulated sector (NRS) coal linkage policy of 2016 and 2020, which now aims to utilise the dry fuel for any industrial use and exports.
Now, any domestic buyer can participate in the auction and buy coal for up to 15 years without any end use requirement. However, traders cannot participate in this newly-created coal linkage auction window.
“Allocation of coal linkages on auction basis for sectors without the requirement of any specific end use through a separate window in the NRS Linkage Auction Policy of 2016 wherein any domestic buyer requiring coal can participate in the linkage auction,” the new norms specify.
The present auction for the specified end-user sub-sectors, as per the NRS Linkage Auction Policy, 2016, shall continue, it added.
“Coal linkage obtained under CoaISETU window shall be for own consumption, export of coal, or any other purpose (including coal washing) except resale in the country,” it added.
The modalities
Specifying the modalities, the Ministry said that auction under the CoaISETU window to be held after conducting auctions of end-use specific sub-sectors (as per the NRS Linkage Auction Policy of 2016) in a specific tranche of the NRS linkage auction.
“The base or floor price of the coal at any source for the auction in the CoaISETU window (is) to be fixed at reserve price not below the notified price, as may be decided by the coal company,” it added.
The reserve price for the NRS linkage auctions shall be suitably indexed by Coal India (CIL) or Singareni Collieries Company (SCCL) for subsequent years. However, the bid premium shall remain constant over the contract period, it clarified.
The tenure of the fuel supply agreements (FSAs) may be for a maximum period of 15 years.
Auctions will be conducted by CIL or SCCL and the procedure including a transparent auction methodology, shall be devised by CIL or SCCL in a manner that induces adequate competition and prevents cartelisation.
“Coal linkage holders may be eligible to export coal up to 50 per cent of their coal linkage quantity. Coal linkage holders may flexibly utilise the coal obtained under this window as per their requirement amongst its Group companies,” the modalities said.
Coal offered through the CoaISETU auction window will be subject to CIL and SCCL meeting the linkage requirements of their existing agreements for the specified end users — power and NRS. It also includes future linkages to these specified end use sectors.
Published on December 25, 2025
