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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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Thursday, 20 June 13
CAPESIZE : FINALLY A SUBSTANTIAL IMPROVEMENT IN RATES! - FEARNLEYS A.S
Handy
Atlantic market kept a steady curve from last week. US Gulf positions fetched tick above USD 21k for Cont/Skaw direction, and vessels fixed f ...
Wednesday, 19 June 13
NEWCASTLE SHIPPED 16.05 PERCENT LESS COAL W/E 17 JUNE 2013
COALspot.com - Newcastle port in Australia has loaded 2,606,071 tons of coal for the week ended 0700 hours 17 June 2013, Newcastle Port Corp. ...
Sunday, 16 June 13
WEAK DEMAND KEEPS COAL PRICES LOW
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average July 2013 delivery have lost 2.94 percent week on week but gained 0.06 percent ...
Saturday, 15 June 13
S7 AND S8 ROUTES ARE EXPECTED TO BE STEADY NEXT WEEK - VISTAAR
COALspot.com - This week freight movement was fairly firm with news of China is rebuilding iron ore stockpiles, and ease import rules. Cape and Pana ...
Saturday, 15 June 13
SHIPPING CONFIDENCE REACHES HIGHEST LEVEL FOR TWO AND A HALF YEARS - MOORE STEPHENS
Overall confidence levels in the shipping industry rose to their highest level for two and a half years in the three months ended May 2013, accordin ...
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- Parliament of New Zealand
- Bhoruka Overseas - Indonesia
- Samtan Co., Ltd - South Korea
- Gujarat Sidhee Cement - India
- Directorate General of MIneral and Coal - Indonesia
- Indogreen Group - Indonesia
- The Treasury - Australian Government
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- McConnell Dowell - Australia
- Energy Link Ltd, New Zealand
- Chettinad Cement Corporation Ltd - India
- GVK Power & Infra Limited - India
- Indonesian Coal Mining Association
- Thai Mozambique Logistica
- Attock Cement Pakistan Limited
- Globalindo Alam Lestari - Indonesia
- SMG Consultants - Indonesia
- Ministry of Transport, Egypt
- GMR Energy Limited - India
- Coal and Oil Company - UAE
- Coastal Gujarat Power Limited - India
- European Bulk Services B.V. - Netherlands
- Medco Energi Mining Internasional
- Australian Coal Association
- Antam Resourcindo - Indonesia
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- Ministry of Mines - Canada
- Thiess Contractors Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Dalmia Cement Bharat India
- Africa Commodities Group - South Africa
- AsiaOL BioFuels Corp., Philippines
- Parry Sugars Refinery, India
- Billiton Holdings Pty Ltd - Australia
- Agrawal Coal Company - India
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- New Zealand Coal & Carbon
- Ministry of Finance - Indonesia
- Latin American Coal - Colombia
- Aditya Birla Group - India
- Heidelberg Cement - Germany
- SN Aboitiz Power Inc, Philippines
- Edison Trading Spa - Italy
- Standard Chartered Bank - UAE
- Grasim Industreis Ltd - India
- Indian Oil Corporation Limited
- Timah Investasi Mineral - Indoneisa
- Bhushan Steel Limited - India
- ASAPP Information Group - India
- Port Waratah Coal Services - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Mercuria Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Independent Power Producers Association of India
- Australian Commodity Traders Exchange
- Wilmar Investment Holdings
- ICICI Bank Limited - India
- Eastern Coal Council - USA
- Ambuja Cements Ltd - India
- Indo Tambangraya Megah - Indonesia
- Global Green Power PLC Corporation, Philippines
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- Bayan Resources Tbk. - Indonesia
- Meralco Power Generation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Sakthi Sugars Limited - India
- CNBM International Corporation - China
- Georgia Ports Authority, United States
- Central Java Power - Indonesia
- Sojitz Corporation - Japan
- Kohat Cement Company Ltd. - Pakistan
- Madhucon Powers Ltd - India
- Sindya Power Generating Company Private Ltd
- Bhatia International Limited - India
- Manunggal Multi Energi - Indonesia
- IHS Mccloskey Coal Group - USA
- Interocean Group of Companies - India
- Jindal Steel & Power Ltd - India
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- Vizag Seaport Private Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Romanian Commodities Exchange
- Intertek Mineral Services - Indonesia
- Metalloyd Limited - United Kingdom
- Singapore Mercantile Exchange
- Asmin Koalindo Tuhup - Indonesia
- Electricity Authority, New Zealand
- White Energy Company Limited
- Kumho Petrochemical, South Korea
- Holcim Trading Pte Ltd - Singapore
- Formosa Plastics Group - Taiwan
- Iligan Light & Power Inc, Philippines
- PTC India Limited - India
- Rio Tinto Coal - Australia
- Savvy Resources Ltd - HongKong
- Bukit Baiduri Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Salva Resources Pvt Ltd - India
- Baramulti Group, Indonesia
- Binh Thuan Hamico - Vietnam
- Trasteel International SA, Italy
- Planning Commission, India
- Mintek Dendrill Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indika Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Merrill Lynch Commodities Europe
- Commonwealth Bank - Australia
- Chamber of Mines of South Africa
- Bukit Makmur.PT - Indonesia
- Bharathi Cement Corporation - India
- Siam City Cement PLC, Thailand
- International Coal Ventures Pvt Ltd - India
- Mercator Lines Limited - India
- Central Electricity Authority - India
- Malabar Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Deloitte Consulting - India
- Anglo American - United Kingdom
- Therma Luzon, Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Eastern Energy - Thailand
- Electricity Generating Authority of Thailand
- Pendopo Energi Batubara - Indonesia
- Wood Mackenzie - Singapore
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Makarim & Taira - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Kartika Selabumi Mining - Indonesia
- Borneo Indobara - Indonesia
- Kobexindo Tractors - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Essar Steel Hazira Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Minerals Council of Australia
- Global Business Power Corporation, Philippines
- Marubeni Corporation - India
- Larsen & Toubro Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Coal Blending Company Limited - Australia
- Bulk Trading Sa - Switzerland
- Meenaskhi Energy Private Limited - India
- Kideco Jaya Agung - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- GAC Shipping (India) Pvt Ltd
- Directorate Of Revenue Intelligence - India
- Xindia Steels Limited - India
- Cement Manufacturers Association - India
- Simpson Spence & Young - Indonesia
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- London Commodity Brokers - England
- Energy Development Corp, Philippines
- Jaiprakash Power Ventures ltd
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- IEA Clean Coal Centre - UK
- Miang Besar Coal Terminal - Indonesia
- Goldman Sachs - Singapore
- Kalimantan Lumbung Energi - Indonesia
- The State Trading Corporation of India Ltd
- Karbindo Abesyapradhi - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Bangladesh Power Developement Board
- Jorong Barutama Greston.PT - Indonesia
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Sical Logistics Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Lanco Infratech Ltd - India
- VISA Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- Power Finance Corporation Ltd., India
- The University of Queensland
- Ceylon Electricity Board - Sri Lanka
- Vijayanagar Sugar Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Petron Corporation, Philippines
- SMC Global Power, Philippines
- Toyota Tsusho Corporation, Japan
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Orica Australia Pty. Ltd.
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- PowerSource Philippines DevCo
- Sarangani Energy Corporation, Philippines
- Tata Chemicals Ltd - India
- Star Paper Mills Limited - India
- Coalindo Energy - Indonesia
- Posco Energy - South Korea
- Renaissance Capital - South Africa
- PNOC Exploration Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- Altura Mining Limited, Indonesia
- San Jose City I Power Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Oldendorff Carriers - Singapore
- South Luzon Thermal Energy Corporation
- Straits Asia Resources Limited - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
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