Cement, Energy and Environment

• current levels. Currently mining activities account for about 4 per cent of total coal emissions in the country and predominantly done from opencast mines (about 85 per cent of total production). But, future coal requirements will be met from underground mines as opencast mining potential has mostly been exploited. Developing underground mines will lead to more methane release due to gassiness of underground mines (As shown in Exhibit - 1). And hence, the percentage of emissions from coal mining activities will also increase from the current 4 per cent. CBM Policy is investor friendly • Allotment through global bidding • Provision of 100% cost recovery • Custom duty exempted on imports • 7 years tax holiday • Freedom to sell gas at market price Dwindle in ramping up coal production and thus, the context demands enactment of a CMM utilization policy which can complement coal production leading to safer and effective practices. Some pilot projects are under various stages of implementation at the CIL owned mine (Moonidih and Sudamdih mines) but the projects have to attain commercial scale. Technologies and business models have already been proven world-wide. Still, more projects are not getting Exhibit -1 Category of Indian Mines in terms of methane content. D-1 mine D-11 mine D-Ill mine implemented in India due to lack of: • Proper mine methane reserves information. • Financial mechanism. incentive • Regulations on methane recovery requirement The need is to have an effective policy framework with clear guidelines to address these issues which are currently impeding CMM project development. CBM Policy in place, CMM still waiting In 1997, India formulated a coal Bed Methane (CBM) policy and invited global players to participate in CBM E&P activities. 23 blocks have been allotted so far through global auctions and 3 blocks have been awarded on nomination basis. The 4 1 h round of auctioning has recently been conducted where bids for 8 blocks were received. The prognostic reserves of these blocks can support around 7,000 MW generation capacity. The CBM policy was amicable to developers and attracted lot of interest from them. To bring interest in CMM development also, a policy is under formulation by Coal Ministry for a while, but yet to take full shape. In India, methane standards are specified in Indian Coal Mine Regulation 1957, which is based 222 102 18 on Mines Act 1952. This regulation sets upper limits on methane concentration in working areas of mine (mine face, main and district exits etc.) However, there is no regulation that specifies recovery and utilization requirements. Hence, concerted action on the part of Govt. is needed to make CMM utilization projects effective and profitable. Essential Features of CMM Policy • Setting robust emission standards on methane emissions from mines will enhance gas recovery practice leading to utilization of gas in pure form. • Addressing technical barriers by accelerating the deployment of appropriate technologies and proven practices that can bring efficiency. • Providing supporting infrastructure for sale of power/gas such as grid connectivity and pipeline transportation. • Providing fiscal incentives to encourage investment in utilization projects. E.g. Import duty exemption , tax holidays, no royalty on gas. • Facilitating cost recovery. E.g. CMM generators can be made eligible to participate in REC scheme or given feed-in tariffs. 49