The ministry has recommended that the regulator should only set the principle and methodology for price determination, moving away from an earlier proposal that gave the proposed regulator the power to determine the price of raw and washed coal.
The ministry has also proposed to keep the power to give authorisation to open and close coalmines with itself. As per the initial draft, the sector regulator was being set up to grant and cancel mining authorisations.
According to an official, the changes were made after several ministries opposed surrendering control over pricing of the fuel and granting mining authorisation to the proposed watchdog. “The authority will only specify, with government approval, the principles and methodology for price determination,” the official said.
The official said a group of ministers (GoM) would meet on Tuesday to deliberate on the draft Coal Regulator Bill. In July, the panel had objected to giving executive powers to the proposed regulator.
The Association of Power Producers, however, says the Bill does not show a move towards creating a strong institution, and proposes that the government will approve any pricing policy created by the authority.
In May, the ministry had sought Cabinet approval for the Coal Regulatory Authority Bill, 2012. It was referred to a GoM after the Cabinet failed to reach a consensus on some of the provisions in the draft.
The ministry had proposed a four-member body to price coal, grant and cancel mining authorisations, set performance standards, monitor coal quality, ensure adherence by mining companies, promote carbon-free technologies and advise the government on policies.
The proposed Bill sought to create a level-playing field for all stakeholders and promote investment in the sector.
The proposal of setting up a coal regulatory authority was first mooted in the Union budget for 2007-08. Presenting the budget for 2009-10, the then finance minister, Pranab Mukherjee, had reiterated the need for an independent regulator.