New Delhi – In a significant stride towards clean energy transition and ecological balance, the Ministry of Coal has intensified its twin approach of advancing coal gasification and ecological restoration of mined-out areas. Backed by a ₹8,500 crore incentive scheme and robust PSU-driven environmental reclamation efforts, the government’s strategy is shaping a greener, more energy-secure future.
₹8,500 Crore Push to Revive Coal Gasification
The Centre has greenlit a three-category incentive scheme worth ₹8,500 crore to promote coal and lignite gasification in both public and private sectors. Announced in January 2024, the scheme has already received active participation, with seven major projects approved under its ambit.
Category-wise distribution includes:
- Category I (PSUs only): ₹4,050 crore provision with 3 projects sanctioned at ₹1,350 crore each.
- Category II (open to PSUs and private firms): ₹3,850 crore outlay with 3 private sector projects approved, receiving ₹1,983.06 crore.
- Category III (demonstration-scale): ₹600 crore reserved, with one private sector project gaining ₹100 crore in government support.
In parallel, Coal India Limited (CIL) has received approval to invest in two joint ventures — one with Bharat Heavy Electricals Limited (BHEL) and another with GAIL — for executing gasification projects. These joint venture companies have now been formally established.
To further accelerate uptake, the Centre introduced new reforms:
- Creation of a dedicated “Production of Syngas” sub-sector under Non-Regulated Sector linkage auctions.
- Guaranteed coal supply to gasification projects at regulated-sector floor prices for those commissioned within the next seven years.
- A 50% revenue share rebate in commercial coal block auctions for projects using at least 10% of coal production in gasification.
- Case-specific waivers for Transfer of Technology (ToT) from land-border-sharing nations, with one such waiver already granted.
Also Read: Coal India, SCCL, and NLCIL Set to Open Dozens of New Mines in Next Five Years
PSUs Spearhead Reclamation and Water Resilience Projects
Coal and lignite PSUs — Coal India Limited, NLC India Limited, and Singareni Collieries Company Limited — are simultaneously leading a large-scale reclamation campaign across mined-out zones. Their mission: to restore ecological balance, rejuvenate groundwater, and enhance community access to water resources.
For FY 2025-26, these PSUs aim to reclaim and afforest 2,800 hectares in and around mining regions. Advanced techniques such as drone-based seed broadcasting, Miyawaki plantations, and seed ball dispersal are being deployed to boost green cover.
Hydrological restoration forms the second pillar of this mission. The Ministry of Coal, in collaboration with the Ministry of Jal Shakti and state governments, is driving the reuse of treated mine water for local domestic and irrigation use. With CGWA-issued No Objection Certificates (NoCs), coal PSUs have rolled out the following initiatives:
- Rainwater Harvesting: Widespread installation of rooftop and surface systems to enhance groundwater recharge.
- Eco-restoration through Plantation: Dense plantation in and around mines to curb soil erosion and increase water retention.
- Water Management Infrastructure: Check dams, garland drains, and gabion walls constructed for better runoff management and siltation control.
- Hydrogeological Monitoring: Ongoing tracking of groundwater levels via CGWA-accredited assessments.
- Revival of Traditional Water Bodies: Restoration of ponds and reservoirs to support communities and maintain ecological balance.
Union Minister for Coal and Mines, Shri G. Kishan Reddy, confirmed these developments in separate written replies in the Rajya Sabha.
About Coal India Limited
Coal India Limited (CIL) is a Maharatna PSU under the Ministry of Coal, Government of India. As the world’s largest coal-producing company, CIL plays a vital role in ensuring India’s energy security. Through a wide array of CSR initiatives, CIL continues to invest in sustainable community development, focusing on education, healthcare, infrastructure, and environmental sustainability—ensuring its impact extends beyond mining to nation-building.
About NLC India
NLC India Limited (NLCIL), formerly known as Neyveli Lignite Corporation, is a Navratna Central Public Sector Undertaking under the Ministry of Coal, Government of India. Established in 1956, NLCIL is headquartered in Neyveli, Tamil Nadu, and specializes in lignite mining and power generation, including thermal, solar, and wind energy.
About SCCL
The Singareni Collieries Company Limited (SCCL) is a government-owned-coal mining corporation in India. It is under the ownership of Department of Energy, Government of Telangana. The Union Government’s administration of the company is through the 49% ownership held by Ministry of Coal.
