Should Delhi Government Control Coal Mines?

Should Delhi Government Control Coal Mines?

AAP government has demanded for a coal block allocation in Delhi that will assist a private firm to set up a colossal plat to supply affordable and adequate electricity to the city. The news was announced by Satyendra Jain, the power Minister of Delhi. It came a day after the PM Narendra Modi made a comment at promises of free power by politicians. Do you think allocation of captive coal mine will help Delhi? Should Delhi Government Control Coal Mines?


- It will be a justified step that will help state government to bring down power tariffs in Delhi. One should not forget that power issue is one of the major issues in Delhi.

- AAP promised to bring cheap power in Delhi. It was one of his targets on pre-election white paper.

- If the state gets a captive coal mine, it will be in a much better position to generate electricity at lowest possible prices. Production within the state is always better.

- The allocation of coal mine will enable power distribution firms in Delhi to buy power at around Rs 2/kWh compared to Rs 5-6 that they pay in open market.

- The allocation of coal mine will help electricity producers to face the monopoly of Coal India Limited. They will get access to premium coal at affordable prices.

- It will minimize Delhi’s dependence on external markets for electricity. The power demand has jumped from almost half to over four-fifths of total power now.


- It is not a long term solution as no matter what the problem of electricity will remain in Delhi. It is one of the critical problems faced by most of the places in world.

- At the moment, Delhi doesn’t need reduced power tariffs but require change in basic governance. It is one of the areas Arvind Kejriwal should focus on.

- It would not help in reducing power tariffs. The most effective way will be to introduce reforms related to Delhi’s electricity distribution system. The customers will have an option to choose between different power producers.

- Delhi is one of country’s better performing states in field of power supply and government should build on it. Getting into operating coal mines is overly grandiose and certainly not an effective solution.

- Just because Arvind Kejriwal promised doesn’t make it a rational decision. There are many other core facilities that cannot be ignored at any cost. The limited funds and benefits cannot be frittered away on fanciful plans.


The proposal is a rational plan as it will not only end monopoly of Coal India, but will also help people get electricity at affordable rates. Apart from consumers, private companies will benefit from the proposal. However, again the factor to consider here is corruption. If AAP can implement project without any hidden plans, the benefits will pass on to local people. If it fails, again it will be only politicians and private companies who will benefit from change. Overall, it is rational decision that will enhance competition in the market and ensure efficiency gains.
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  • RE: Should Delhi Government Control Coal Mines? -Deepa Kaushik (02/25/15)
  • Delhi Government has many objectives to focus on. At this point of time, it would be an added responsibility for the Delhi Government to have a control on the Coal Mines. The control of the coal mines does not only link with the power generation, but it would also have its own set of pros and cons. The infrastructural requirements for the coal mine, and the various other allocations would also follow the Delhi Government. And taking the responsibility will definitely add-on to the burden for the Kejriwal Government at the start of their Governance.

    It is understandable that Kejriwal’s team had a set manifesto in the pre-election campaign and it is really appreciable that they do take the responsibility to get back to their promise and give a kick start to the same. The power consumption, its demand and supply can definitely be controlled better if the coal mine comes under the direct supervision of the Delhi Government. It might also help in reduction of the power tariffs to some extent, if the plans of the AAP goes well on their marked lines.

    Still, the AAP Government should consider the pros and cons of taking over the coal mines. They lead to evaluate and equate the various other accompanying duties and responsibilities in the form of subsidies and funds with the coal distribution into the hands of Government. Delhi Government should also take in to consideration the various other possibilities that could help in the reduction of power tariffs.