Keralam power crisis: KSEB makes fresh attempt at tapping coal linkage under SHAKTI policy

You don’t have any Active Subscription.

Account subscription benefits alongside Premium Stories, Editorials, Opinions and more. Unlock these with Subscription

Keralam is making a fresh attempt at a long-term procurement of electricity using the coal linkage allocated to it. State-run power utility Kerala State Electricity Board (KSEB) has floated a request for qualification (RfQ) for the supply of 500 megawatts (MW) of round-the-clock (RTC) power for a period of 25 years under the Union Coal Ministry’s Scheme for Harnessing and Allocating Koyala (Coal) Transparently in India ((B(iv) of SHAKTI).

As per the RfQ floated on September 23, the KSEB hopes to have the supply commencing from June 2, 2027.

Earlier attempts by the KSEB to tap the coal linkage had failed to work out. The fresh move comes as Keralam struggles through a monsoon-season power crisis that exposed the critical weaknesses of its power system which is heavily dependent on electricity ‘imports’ from elsewhere in the country. Over the past several weeks, the KSEB had imposed power curbs in the evening hours following a supply shortage in meeting the peak demand.

The proposed power supply agreement is meant to be on Design, Build, Finance, Own and Operate (DBFOO) basis. The RfQ document noted that the KSEB is planning to procure electricity on long-term basis -- for 25 years -- through public-private partnership on DBFOO mode by sourcing fuel from Coal India or its subsidiary under the SHAKTI Policy.

The policy permits States and distribution companies such as the KSEB to pursue tariff-based competitive bidding for long-term and medium-term power procurement in line with Union Power Ministry norms and recommend the granting of the coal linkage to successful bidders.

The KSEB plans to announce the pre-qualified applicants on December 3, 2026, and open the bids on January 4, 2027. The utility hopes to sign the power sale agreement on March 5, 2027. A Pre-Application Conference is expected to be held in the last week of October this year.

In June 2025, the State Electricity Regulatory Commission had approved a tender for procuring 500 MW for 25 years under B(iv) SHAKTI policy. The rates presented by the bidders were on the higher side when the bids were opened in October 2025. After negotiations failed to sufficiently bring down the price, the tender was annulled in February 2026.

Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.