New Delhi: The royalties given to states on behalf of coal mining has been increased by Rs 1,000 per tonne by the government. This will boost the revenues of states like Jharkhand, Andhra Pradesh and Chhatisgarh. But the move may affect the common man with increased electricity bills.

In the cabinet committee on economic matters, decision on proposal of restructuring of royalty on coal and lignite has been taken. At present, states are paid 14 percent and 6 percent royalty on coal and lignite respectively. Now royalties will be given on the basis of price. According to the notice sent by the government states are given Rs 5,950 crore annual royalty which will increase to Rs 6,980 crore with the new formula.

States royalty rates have changed after 2007. It is evident that coal companies will be affected with increased load. According to experts, coal companies will pass the load to power companies which subsequently will be passed to customers.