BCCL Introduces Incentive Scheme with Up to 10% Discount for Power Sector

Bharat Coking Coal Limited (BCCL) has introduced a Performance-Linked Incentive scheme for Power Sector consumers for the April-June quarter of FY27.  

The scheme applies to entities operating under Fuel Supply Agreements (FSA), including those covered by the flexi-linkage mechanism. 

Coal offtake through rail, road and rail-cum-road (RCR) routes will be considered, with benefits linked to the proportion of coal lifted against the contracted quarterly quantity (QQ). 

Offtake Thresholds and Discounts 

The structure sets clear slabs for eligibility. No cash discount is available where offtake remains below 120% of QQ.  

In such cases, the existing performance incentive (PI) continues to apply only to raw coal under FSA terms. Washed power coal is not included for PI calculation in this bracket. 

For offtake between 120% and 140% of QQ, a 5% cash discount is offered on quantities lifted beyond 100%. Where offtake exceeds 140%, the discount increases to 10% on incremental volumes. 

Limits on Existing Incentives 

BCCL has capped the applicability of PI in higher offtake slabs. For volumes above 120% of QQ, PI will not apply to quantities beyond 90% of the contracted level. This restriction continues even when offtake crosses 140%. 

The cash discount applies to raw coking coal and washed power coal, subject to quality checks. The benefit will be issued through credit notes, which can be adjusted against future supplies. 

Supply and Movement Focus 

The scheme comes at a time when coal movement and steady supply remain in focus for power generation. The company has asked consumers to plan higher lifting, particularly through rail, while maintaining flows through other transport modes. 

The approach is intended to support improved coal evacuation and align supply with demand during the quarter. 

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Conclusion 

The scheme links higher coal lifting with defined discounts while limiting the scope of existing incentives, setting out the terms for power producers during the first quarter of FY27. 

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