CERC issues staff paper on review of composite index used for computing the escalation rate for imported coal for bid evaluation and payment

The CERC has issued a staff paper on review of composite index used for computing the escalation rate for imported coal for bid evaluation and payment. It has been more than a decade since the last revision and there have been developments in the international coal markets. Based on these changes, CERC has proposed a methodology containing three major changes, i.e. incorporation of two new price indices in place of the existing coal price index used for Australian coal; incorporation of a new price index in place of the existing coal price index used for South African coal; and changes in the weight assignments based on the trends in steam coal imports in India. Further, CERC has proposed to review the composite index every three years or as and when the need arises. The CERC has sought comments on the staff paper by June 30, 2023.