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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, 21 May 13
NEWCASTLE PORT COAL SHIPMENTS SEEN FALLING WEEK ON WEEK
COALspot.com - Newcastle port in Australia has loaded 2,205,024 tons of thermal and coking coal for week ended 0700 hours 20 May 2013, Newcast ...
Sunday, 19 May 13
COAL PRICES ARE SLUMPING DUE TO WEAK DEMAND
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average July 2013 delivery have gained 0.03 percent and API 8 CFR South China Coal shipment g ...
Sunday, 19 May 13
FREIGHT RATES TO REMAIN UNSTABLE AND VOLATILE - CAPT. REDDY
COALspot.com – The freight remained weak this week with all the segments down.
The BDI, the Baltic Dry Index is a number issued daily by th ...
Friday, 17 May 13
US COAL PRODUCTION CLIMBED 3.35 PER CENT WEEK ON WEEK
COALspot.com - U.S. produced totaled approximately 18.50 million short tons (mmst) in a week (For the week ended May 11, 2013), EIA said in its late ...
Thursday, 16 May 13
PANAMAX: THE FORWARD CURVE IS FALLING GRADUALLY - FEARNRESEARCH
Handy
The Atlantic market remained quiet. The USG-Feast was at USD 19k and Black Sea-Feast was at USD 11k. The Pacific market remained uncertain as ...
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- Aboitiz Power Corporation - Philippines
- Borneo Indobara - Indonesia
- Romanian Commodities Exchange
- Bulk Trading Sa - Switzerland
- Bhushan Steel Limited - India
- PowerSource Philippines DevCo
- South Luzon Thermal Energy Corporation
- Banpu Public Company Limited - Thailand
- Savvy Resources Ltd - HongKong
- Tata Chemicals Ltd - India
- Siam City Cement - Thailand
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- Chamber of Mines of South Africa
- OPG Power Generation Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Parliament of New Zealand
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- Sical Logistics Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Global Business Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Carbofer General Trading SA - India
- Minerals Council of Australia
- Indika Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Medco Energi Mining Internasional
- Coalindo Energy - Indonesia
- Ministry of Transport, Egypt
- Attock Cement Pakistan Limited
- Madhucon Powers Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Vedanta Resources Plc - India
- Eastern Coal Council - USA
- Central Electricity Authority - India
- Cement Manufacturers Association - India
- Karaikal Port Pvt Ltd - India
- Meralco Power Generation, Philippines
- VISA Power Limited - India
- Goldman Sachs - Singapore
- Power Finance Corporation Ltd., India
- Bahari Cakrawala Sebuku - Indonesia
- Posco Energy - South Korea
- CIMB Investment Bank - Malaysia
- Makarim & Taira - Indonesia
- Planning Commission, India
- Star Paper Mills Limited - India
- GMR Energy Limited - India
- Ministry of Mines - Canada
- Mercuria Energy - Indonesia
- Ambuja Cements Ltd - India
- Cigading International Bulk Terminal - Indonesia
- ICICI Bank Limited - India
- Wood Mackenzie - Singapore
- Kartika Selabumi Mining - Indonesia
- Georgia Ports Authority, United States
- Bharathi Cement Corporation - India
- European Bulk Services B.V. - Netherlands
- Indogreen Group - Indonesia
- Port Waratah Coal Services - Australia
- Ind-Barath Power Infra Limited - India
- Trasteel International SA, Italy
- Jaiprakash Power Ventures ltd
- Ceylon Electricity Board - Sri Lanka
- Central Java Power - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Latin American Coal - Colombia
- Jorong Barutama Greston.PT - Indonesia
- Australian Commodity Traders Exchange
- Videocon Industries ltd - India
- MS Steel International - UAE
- Heidelberg Cement - Germany
- Independent Power Producers Association of India
- Timah Investasi Mineral - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Antam Resourcindo - Indonesia
- Kaltim Prima Coal - Indonesia
- ASAPP Information Group - India
- Marubeni Corporation - India
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
- Malabar Cements Ltd - India
- Directorate Of Revenue Intelligence - India
- Kalimantan Lumbung Energi - Indonesia
- Indian Oil Corporation Limited
- GN Power Mariveles Coal Plant, Philippines
- Thai Mozambique Logistica
- Bangladesh Power Developement Board
- Economic Council, Georgia
- AsiaOL BioFuels Corp., Philippines
- Renaissance Capital - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kepco SPC Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Australian Coal Association
- Oldendorff Carriers - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The State Trading Corporation of India Ltd
- London Commodity Brokers - England
- Miang Besar Coal Terminal - Indonesia
- Kobexindo Tractors - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Globalindo Alam Lestari - Indonesia
- Intertek Mineral Services - Indonesia
- PTC India Limited - India
- New Zealand Coal & Carbon
- Manunggal Multi Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- TeaM Sual Corporation - Philippines
- Anglo American - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- Jindal Steel & Power Ltd - India
- Xindia Steels Limited - India
- Aditya Birla Group - India
- Maheswari Brothers Coal Limited - India
- Baramulti Group, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Makmur.PT - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petron Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Electricity Authority, New Zealand
- SMC Global Power, Philippines
- SN Aboitiz Power Inc, Philippines
- The Treasury - Australian Government
- Gujarat Mineral Development Corp Ltd - India
- Edison Trading Spa - Italy
- PNOC Exploration Corporation - Philippines
- SMG Consultants - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mintek Dendrill Indonesia
- Eastern Energy - Thailand
- Sarangani Energy Corporation, Philippines
- Grasim Industreis Ltd - India
- Lanco Infratech Ltd - India
- Sree Jayajothi Cements Limited - India
- Metalloyd Limited - United Kingdom
- Holcim Trading Pte Ltd - Singapore
- Kapuas Tunggal Persada - Indonesia
- Binh Thuan Hamico - Vietnam
- Price Waterhouse Coopers - Russia
- GVK Power & Infra Limited - India
- India Bulls Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Pendopo Energi Batubara - Indonesia
- LBH Netherlands Bv - Netherlands
- Indian Energy Exchange, India
- Africa Commodities Group - South Africa
- Leighton Contractors Pty Ltd - Australia
- McConnell Dowell - Australia
- Formosa Plastics Group - Taiwan
- Krishnapatnam Port Company Ltd. - India
- Orica Mining Services - Indonesia
- Essar Steel Hazira Ltd - India
- Parry Sugars Refinery, India
- Kideco Jaya Agung - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Mjunction Services Limited - India
- Indonesian Coal Mining Association
- Thiess Contractors Indonesia
- Siam City Cement PLC, Thailand
- Straits Asia Resources Limited - Singapore
- Bhoruka Overseas - Indonesia
- Tamil Nadu electricity Board
- Toyota Tsusho Corporation, Japan
- San Jose City I Power Corp, Philippines
- CNBM International Corporation - China
- Commonwealth Bank - Australia
- Semirara Mining Corp, Philippines
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Iligan Light & Power Inc, Philippines
- Standard Chartered Bank - UAE
- Electricity Generating Authority of Thailand
- Asmin Koalindo Tuhup - Indonesia
- The University of Queensland
- Semirara Mining and Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Energy Development Corp, Philippines
- IEA Clean Coal Centre - UK
- Agrawal Coal Company - India
- Rashtriya Ispat Nigam Limited - India
- Wilmar Investment Holdings
- Rio Tinto Coal - Australia
- Meenaskhi Energy Private Limited - India
- Global Coal Blending Company Limited - Australia
- Bhatia International Limited - India
- Larsen & Toubro Limited - India
- Sojitz Corporation - Japan
- Petrochimia International Co. Ltd.- Taiwan
- Mercator Lines Limited - India
- Directorate General of MIneral and Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- Bukit Asam (Persero) Tbk - Indonesia
- Global Green Power PLC Corporation, Philippines
- Dalmia Cement Bharat India
- Vizag Seaport Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karbindo Abesyapradhi - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Ministry of Finance - Indonesia
- Orica Australia Pty. Ltd.
- Deloitte Consulting - India
- White Energy Company Limited
- Sindya Power Generating Company Private Ltd
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