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Friday, 03 August 12
INDIA - LIGHTS OUT! - SALVA
 The Indian power sector hit global headlines this week for all the wrong reasons. Firstly, on Monday, over 350 million people lost power across northern India, including Delhi. The following day, the lights went out again, but this time over 600 million people in 20 of India’s 28 states were affected, with the outages covering range of 3000 kilometers in the northern and eastern regions. The authorities’ response has ranged from blaming states for overdrawing from the grid, to appointing a committee to inquire into the causes of the blackout. However, these latest outages are merely symptomatic of much larger problems in India’s power sector, which has been short of power for years.
In Salva’s view, the problem does not lie within the generation sector – but with its upstream (coal supply and transportation) and downstream (transmission and distribution) counterparts. Since the generation sector was deregulated in FY03-04 to enable private participation, installed generation capacity has almost doubled, growing by 92GW or 85%, at a CAGR of 10.8%. The vast majority of this new capacity is coal-fired, which added another 18GW of new capacity in FY11-12 and a further 4.2GW in Q1’12.
However, this new power generation capacity is not being fully utilised, with plant load factors for coal declining from 79.2% in H1’11 to 75.8% in H1’12 and 72% most recently in June. Over 4.3TWh of coal-fired generation was lost in June alone due to low coal supply with a further 1.4TWh lost because of transmission constraints and unplanned outages. Given these figures, clearly thermal coal supply remains a problem. While domestic coal production has increased in 2012, it has languished in recent years, growing at around 1% (5Mt) between 2008-11, which pales in comparison against annual coal-fired power capacity growth of over 10%. Even when production is strong, which it has been in early 2012 (by Indian standards), transportation of coal remains highly problematic. Indian Railways has not been able to procure wagons in time to boost availability sufficiently. This has resulted in coal shortages at power plants and growth in coal mine stockpiles. Transport capacity remains severely constrained as capacity addition has languished at the altar of populism. Passenger traffic shares the same infrastructure as freight, causing freight such as coal to be given a lower priority.
The Electricity Act of 2003 freed up the generation sector, but the same reforms haven’t yet percolated to the transmission and distribution sectors, which are suffering from the same bottlenecks that existed prior to 2003. Transmission capacity is not being developed at the same pace as generation capacity, while distribution reforms remain a pipe dream. As domestic coal production has not kept pace with demand, power producers have used much costlier imported coal to generate electricity. However, India’s tariff framework is still lagging behind, so the State Electricity Boards require ever increasing financial support from state owned banks and financial institutions. Tariff reform is an immediate requirement. Only that will facilitate the sector’s much needed investment.
What are the implications if this is not done now?
Indian cities are accustomed to power cuts. However, increasing prosperity has increased electricity demand and, coupled with the weak monsoon this year, has caused power demand to spike. Agricultural states like Uttar Pradesh, Haryana and Punjab have increasingly overdrawn power from the grids to feed the agricultural sector (which ironically is not metered as power is free for farmers) and to meet residential demand. The agricultural sector is still dependent upon the monsoon as the irrigation network is not widespread, and the weak monsoon has resulted in farmers pumping groundwater onto their fields. Generally electricity demand is low during the monsoon months (June-September) as the rains reduce temperatures. However, the rains have been weak and hence residential power demand has remained strong. This has been further exacerbated with the additional demand from the agricultural sector. State power distribution companies have not planned in advance to buy additional electricity and have overdrawn power from the grid without additional generation being supplied. This has destabilised the grid and caused it to fail.
The impact of the electricity shortages have been felt by the public at large, with a few incidents of people protesting on the road. However, it hasn’t erupted into widespread unrest - thankfully.
The implications of not carrying out reforms in the transmission and distribution sector are now apparent. Lack of adequate investment in the transmission sector will hobble the impressive generation capacity that has been developed. Lack of commercial reforms in the power distribution sector will not provide the returns or even cover the basic cost of generation. The power sector is already sick and if reforms are not carried out with the seriousness required, India will suffer further setbacks.
Source: Salva
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Tuesday, 25 June 13
NEWCASTLE PORT SHIPPED OUT MORE COAL W-O-W
COALspot.com - Newcastle port in Australia has loaded 3,101,378 tons of coal for the week ended 0700 hours 24 June 2013, Newcastle Port Corp. ...
Monday, 24 June 13
INDONESIA COAL SWAP FOR AUGUST 2013 DELIVERY GAINS WEEK ON WEEK
COALspot.com – Coal prices for immediate supply contracts have started moving up, but prices for next year supply shows a negative trend ...
Sunday, 23 June 13
BDI CROSSED ITS PSYCHOLOGICAL BARRIER THIS WEEK - VISTAAR
COALspot.com : The BDI crossed the psychological barrier of 1000 points after many months and closed at 1,027 points, which were up by 14.11 pct wee ...
Sunday, 23 June 13
SHIP PRICES NOT FOLLOWING FREIGHT MARKET FUNDAMENTALS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Although it's been the case in many occasions in the past, it appears that ship prices haven't been quite following freight market fundamentals, i ...
Friday, 21 June 13
U.S. COAL PRODUCTION INCREASED WEEK ON WEEK, EIA SAYS
COALspot.com – United states the world’s second largest coal producer produced totalled approximately 19.70 million short tons (mmst) of ...
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- Ceylon Electricity Board - Sri Lanka
- Kartika Selabumi Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- Central Electricity Authority - India
- PNOC Exploration Corporation - Philippines
- Sojitz Corporation - Japan
- Petron Corporation, Philippines
- Grasim Industreis Ltd - India
- Salva Resources Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- GMR Energy Limited - India
- Alfred C Toepfer International GmbH - Germany
- Essar Steel Hazira Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Business Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- CIMB Investment Bank - Malaysia
- Eastern Energy - Thailand
- Electricity Authority, New Zealand
- Therma Luzon, Inc, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Interocean Group of Companies - India
- Edison Trading Spa - Italy
- Parliament of New Zealand
- Vedanta Resources Plc - India
- Ministry of Mines - Canada
- Xindia Steels Limited - India
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- South Luzon Thermal Energy Corporation
- Baramulti Group, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The State Trading Corporation of India Ltd
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- Bukit Makmur.PT - Indonesia
- White Energy Company Limited
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- Gujarat Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
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- Bulk Trading Sa - Switzerland
- Bhushan Steel Limited - India
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Manunggal Multi Energi - Indonesia
- Meralco Power Generation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Commonwealth Bank - Australia
- Latin American Coal - Colombia
- Intertek Mineral Services - Indonesia
- Jindal Steel & Power Ltd - India
- Simpson Spence & Young - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Indian Oil Corporation Limited
- Semirara Mining and Power Corporation, Philippines
- Minerals Council of Australia
- Energy Development Corp, Philippines
- Mercator Lines Limited - India
- Georgia Ports Authority, United States
- Lanco Infratech Ltd - India
- Timah Investasi Mineral - Indoneisa
- Directorate Of Revenue Intelligence - India
- Anglo American - United Kingdom
- Port Waratah Coal Services - Australia
- Medco Energi Mining Internasional
- Sree Jayajothi Cements Limited - India
- MS Steel International - UAE
- New Zealand Coal & Carbon
- Formosa Plastics Group - Taiwan
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- Standard Chartered Bank - UAE
- Karaikal Port Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Chettinad Cement Corporation Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Goldman Sachs - Singapore
- Heidelberg Cement - Germany
- Chamber of Mines of South Africa
- Binh Thuan Hamico - Vietnam
- Ministry of Finance - Indonesia
- Barasentosa Lestari - Indonesia
- Jaiprakash Power Ventures ltd
- San Jose City I Power Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Malabar Cements Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Agrawal Coal Company - India
- Economic Council, Georgia
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Tamil Nadu electricity Board
- European Bulk Services B.V. - Netherlands
- Bukit Baiduri Energy - Indonesia
- Eastern Coal Council - USA
- Parry Sugars Refinery, India
- Bayan Resources Tbk. - Indonesia
- Posco Energy - South Korea
- Leighton Contractors Pty Ltd - Australia
- Power Finance Corporation Ltd., India
- ICICI Bank Limited - India
- Kepco SPC Power Corporation, Philippines
- Renaissance Capital - South Africa
- Energy Link Ltd, New Zealand
- Bangladesh Power Developement Board
- Aditya Birla Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ind-Barath Power Infra Limited - India
- Banpu Public Company Limited - Thailand
- Sindya Power Generating Company Private Ltd
- CNBM International Corporation - China
- Maheswari Brothers Coal Limited - India
- Cement Manufacturers Association - India
- Savvy Resources Ltd - HongKong
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Larsen & Toubro Limited - India
- Mercuria Energy - Indonesia
- SMG Consultants - Indonesia
- Global Coal Blending Company Limited - Australia
- Central Java Power - Indonesia
- Australian Coal Association
- Kohat Cement Company Ltd. - Pakistan
- Tata Chemicals Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Wood Mackenzie - Singapore
- Makarim & Taira - Indonesia
- Ambuja Cements Ltd - India
- TeaM Sual Corporation - Philippines
- Metalloyd Limited - United Kingdom
- Samtan Co., Ltd - South Korea
- SN Aboitiz Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Wilmar Investment Holdings
- Globalindo Alam Lestari - Indonesia
- PTC India Limited - India
- Electricity Generating Authority of Thailand
- SMC Global Power, Philippines
- Altura Mining Limited, Indonesia
- Dalmia Cement Bharat India
- Iligan Light & Power Inc, Philippines
- GVK Power & Infra Limited - India
- Bhatia International Limited - India
- Mintek Dendrill Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Sarangani Energy Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Kumho Petrochemical, South Korea
- Miang Besar Coal Terminal - Indonesia
- Carbofer General Trading SA - India
- Uttam Galva Steels Limited - India
- Marubeni Corporation - India
- Antam Resourcindo - Indonesia
- Price Waterhouse Coopers - Russia
- Holcim Trading Pte Ltd - Singapore
- OPG Power Generation Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Thai Mozambique Logistica
- Sinarmas Energy and Mining - Indonesia
- The University of Queensland
- Coastal Gujarat Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- AsiaOL BioFuels Corp., Philippines
- India Bulls Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Madhucon Powers Ltd - India
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- GAC Shipping (India) Pvt Ltd
- Vizag Seaport Private Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Star Paper Mills Limited - India
- VISA Power Limited - India
- Semirara Mining Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Gujarat Sidhee Cement - India
- Siam City Cement - Thailand
- Ministry of Transport, Egypt
- Siam City Cement PLC, Thailand
- Attock Cement Pakistan Limited
- Bhoruka Overseas - Indonesia
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Deloitte Consulting - India
- Indian Energy Exchange, India
- Merrill Lynch Commodities Europe
- London Commodity Brokers - England
- Indonesian Coal Mining Association
- Indogreen Group - Indonesia
- Indika Energy - Indonesia
- The Treasury - Australian Government
- IEA Clean Coal Centre - UK
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Billiton Holdings Pty Ltd - Australia
- Thiess Contractors Indonesia
- Sical Logistics Limited - India
- Romanian Commodities Exchange
- Gujarat Mineral Development Corp Ltd - India
- Planning Commission, India
- ASAPP Information Group - India
- Coalindo Energy - Indonesia
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