The other route. Well. It gets worse.  In the name of 'failed auctions' the gov't has begun giving away coal blocks to corporates, going by its liking. Adani has gained from this discrete change in rules. And another 11 companies too.

The details are skanky.

And, oh, the Coal Ministry has issued a "clarification" on our investigation. A unique one. It does not deny any of our facts and assertions. Not one. Needless to say, we stand by each word in our stories. But, I will come to that later.

The stories.

It began in 2021, while we were dealing with Covid-19. In June 2021, Adani Group emerged as successful bidder for a thermal power plant in Madhya Pradesh's Singrauli forests.

In October, news reports carried an alarming statistic: power plants in India had only 4 days of coal stocks left.

This news, many experts cautioned, was ripe for misuse. Since a lot of commentary had morphed into a discussion about "coal shortage" or "coal crisis".

This was not the case. As the Coal Ministry itself clarified in Parliament: the shortfall of coal stocks in power plants was a logistical issue caused by rains. It was NOT an indication of coal shortage in the country.

Yet, predictably,  the rumour was boon for some.

In November 2021, an industry group representing top power producers in the country, saw an opportunity.

The group, called Association of Power Producers, immediately began lobbying with the government to open up more coal blocks for auctions. It specifically asked for 2 blocks.

Both of them seemed to have links to one of the Association's members: the Adani Group.One block, situated in Hasdeo Aranya forests, was adjacent to blocks Adani mines. The other, in MP's Singrauli forests, was in the vicinity of the power plant Adani was poised to acquire.

The block in MP, called Mara II Mahan, was also among a list of 15 coal blocks the Environment Ministry had recommended against opening up. All 15 of the blocks, the Ministry said, were in forests that need to be conserved.

Just because the Association of Power Producers had lobbied for it, the Coal Ministry began acting on its demand for opening up the two blocks. But it also went a step ahead.

Since the MP block was part of the list of 15 blocks, it threw open all 15 to the possibility of mining.

The Coal Ministry, acting at the behest of private firms, tasked its expert institute -- Coal Mine Planning and Design Institute (CMPDI) -- to look at the possibility of carving out portions of the 15 coal blocks for mining without "disturbing" the ecologically fragile areas.

In April 2022, CMPDI presented its observations on potential mining in the 15 coal blocks. Its verdict: none of the 15 block should be opened up. This included Mara II Mahan which has a forest cover of over 90%.

Now both the Environment Ministry and its own expert institute had told the Coal Ministry the same thing. Mara II Mahan cannot be mined.

Guess what the Coal Ministry did?

Summarily dismissed both.

In August 2022, the Coal Secretary wrote to the Environment Secretary and said they intend to place 5 coal blocks of the 15 on no-mining list for auctions. The 5 included Mara II Mahan that the industry lobby had set their eyes on.

The Environment Ministry went along with it.

In March 2023, Mara II Mahan was placed for auctions. Overturning years of recommendations against mining it.

No prizes for guessing who bid for the mine.

The Adani Group did. In fact, the Adani subsidiary that owns the Singrauli Power Plant was the sole bidder.

In its official submissions for green clearances, the Adani Group had categorically stated that it would source its coal requirement for the power plant from coal blocks in the vicinity.

Was it a coincidence that the Association lobbied for such a block and the govt opened it up?

That's anybody's guess.

Meanwhile, since the block did not attract multiple bidders, the auction was annulled.

But there's a twist in the tale.

As per auction rules, which the Modi govt has quietly amended over the years, coal blocks that attract sole bidders can be allocated to private companies. All at the govt's discretion.

Which basically means, a bunch of bureaucrats have the power to decide which company gets coal blocks and which doesn't.

This, experts we spoke to say, is a new version of the old coal scam the Modi govt was supposed to do away with.

In 2014, the Supreme Court quashed 204 mine allocations made since 1993. Since they were allocated by a "screening committee" that had powers to allocate blocks to private companies.

Since they weren't competitively auctioned, the SC said their true price was never discovered.

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The Modi govt which rode an anti-corruption wave to power promised to clean up the sector and allot blocks in a transparent way. All while ensuring the allocations would generate enough revenue for the country (they made bogus claims of auctions generating Rs 3 trillion, etc).

But over time, the enthusiasm these auctions have generated has waned. Blocks have few takers, if any. The govt then began chipping away at auction rules, making it easier for businesses to participate and compete.  Many blocks remained unsold nonetheless.

So it formed an Empowered Committee of Secretaries -- four bureaucrats -- empowered to decide whether a company should get a block or not if it's the sole bidder.

Once again, the govt assumed discretionary powers for allocations to private companies.

But there's something radically different now compared to the pre-2014 era. We're soon entering an era of surplus coal, as confirmed by the Coal Minister himself.

Plus, according to estimates by govt-owned Coal India and independent researchers, the coal mines allocated till now are not only sufficient to take care of India's power requirement over the next decade but are in excess of the estimated requirement

Yet, the Coal Ministry continues to be desperate to allocate more and more coal blocks to private companies. Since these are single bidders, the cost they bid for will by default be low.

Adani bagged a mine last year via the single bidder route last year at just 5% revenue share.

For comparison, 4% revenue share was the minimum possible bid a company could make in the first few tranches.

Along with Adani, 11 other companies have got blocks through the Empowered Committee so far.

The question is, will Mara II Mahan join this list?

Coming back to the Ministry's "clarification":

1. We have said nothing about environment clearances in our story.

2. We have never claimed/implied that Adani got the block.

3. We never said/insinuated that Pendrakhi block has been put up for auction.

Tonally, the clarification is designed to resemble a fact check but in reality it is eyewash. A statement pretending to challenge our reportage so that some social media handles can amplify it.

You can find the docs used for the stories here: https://reporters-collective.in/projects/coal-reforms-undermined…

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We've discussed our findings and bringing in broader perspectives on the sector on X spaces. Hope to see all of you join us there!

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