SHAKTI (Scheme for Harnessing and Allocating Koyala Transparently in India)

The policy SHAKTI was initiated on May 17, 2017 by Union Cabinet, to make coal available to all the Thermal Power Plants of the country in a transparent and objective manner and at the same time ensure that the benefits of linkage coal are transferred to the end consumers.

• The policy was an important initiative in alleviating one key challenge in power sector, viz. lack of coal linkage and is expected to positively contribute in resolution of a number of stressed assets.
• Allocation of linkages (buying coal from a mine closer to the power plant) for power sector shall be based on auction of linkages or through Power Purchase Agreement (PPA) based on competitive bidding of tariffs except for the State and the Central Power Generating companies.
• The Companies which did not have coal linkages benefited immensely from the new policy, as they have got domestic fuel supplies at competitive rates through auction.