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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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Sunday, 28 April 13
PANAMAX FREIGHT COULD BE SOFT NEXT WEEK - CAPT. REDDY
COALspot.com - This BDI closed slightly lower at 871 points (down by 1.91 pct) mainly due to drop in the Panamax index by almost 10 pct.
Th ...
Saturday, 27 April 13
HANDY : SLIDING ; PANAMAX : POSITIVE ; CAPESIZE : STILL ON ITS KNEES - FEARNRESEARCH
Handy
The Atlantic markets started sliding with no fresh cargoes seen in the market. The USG-Feast was at USD 18k and Black sea-Feast was at USD 11 ...
Saturday, 27 April 13
2ND CHINA INTERNATIONAL SHALE GAS SUMMIT
Press Release - 2nd China International Shale Gas Summit, 10-13 September 2013 | Chengdu, China
*The largest annual event for the shale gas indus ...
Friday, 26 April 13
LIMA SUMMIT IN JULY TO HIGHLIGHT LATIN AMERICAN MINING POTENTIAL
COALspot.com - Latin American mining industry officials and their private sector counterparts will be gathering in Lima, Peru on July 1-2 for the La ...
Wednesday, 24 April 13
FUTURE US POWER MARKET SHARES OF COAL, NATURAL GAS GENERATORS DEPEND ON RELATIVE FUEL PRICES - EIA
COALspot.com - In recent years, in US, natural gas competed more effectively with coal as a fuel for electricity generation as the cost of operating ...
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- ASAPP Information Group - India
- TeaM Sual Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- Sakthi Sugars Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- South Luzon Thermal Energy Corporation
- Bhatia International Limited - India
- Simpson Spence & Young - Indonesia
- Energy Development Corp, Philippines
- McConnell Dowell - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jaiprakash Power Ventures ltd
- Ind-Barath Power Infra Limited - India
- Toyota Tsusho Corporation, Japan
- Altura Mining Limited, Indonesia
- Medco Energi Mining Internasional
- Marubeni Corporation - India
- Latin American Coal - Colombia
- International Coal Ventures Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Heidelberg Cement - Germany
- Petrochimia International Co. Ltd.- Taiwan
- MS Steel International - UAE
- Alfred C Toepfer International GmbH - Germany
- Oldendorff Carriers - Singapore
- Ministry of Transport, Egypt
- IHS Mccloskey Coal Group - USA
- Indogreen Group - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Port Waratah Coal Services - Australia
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Ministry of Mines - Canada
- Binh Thuan Hamico - Vietnam
- Indika Energy - Indonesia
- Larsen & Toubro Limited - India
- Bhoruka Overseas - Indonesia
- SN Aboitiz Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- SMC Global Power, Philippines
- Indian Energy Exchange, India
- Kepco SPC Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Anglo American - United Kingdom
- Sical Logistics Limited - India
- Coalindo Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- CNBM International Corporation - China
- Thiess Contractors Indonesia
- Vedanta Resources Plc - India
- Kapuas Tunggal Persada - Indonesia
- Commonwealth Bank - Australia
- Electricity Authority, New Zealand
- Ministry of Finance - Indonesia
- Star Paper Mills Limited - India
- Videocon Industries ltd - India
- Baramulti Group, Indonesia
- Indian Oil Corporation Limited
- Gujarat Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- Planning Commission, India
- GMR Energy Limited - India
- Economic Council, Georgia
- Bahari Cakrawala Sebuku - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mintek Dendrill Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Rio Tinto Coal - Australia
- Eastern Energy - Thailand
- Wood Mackenzie - Singapore
- Chamber of Mines of South Africa
- Price Waterhouse Coopers - Russia
- Sarangani Energy Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Orica Mining Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Petron Corporation, Philippines
- Agrawal Coal Company - India
- Coal and Oil Company - UAE
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Aditya Birla Group - India
- Asmin Koalindo Tuhup - Indonesia
- Global Business Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Ambuja Cements Ltd - India
- PNOC Exploration Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Parliament of New Zealand
- Renaissance Capital - South Africa
- Barasentosa Lestari - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sree Jayajothi Cements Limited - India
- OPG Power Generation Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Carbofer General Trading SA - India
- Sinarmas Energy and Mining - Indonesia
- Posco Energy - South Korea
- Savvy Resources Ltd - HongKong
- Edison Trading Spa - Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Romanian Commodities Exchange
- Energy Link Ltd, New Zealand
- Independent Power Producers Association of India
- Krishnapatnam Port Company Ltd. - India
- PTC India Limited - India
- Grasim Industreis Ltd - India
- Semirara Mining Corp, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Africa Commodities Group - South Africa
- Bukit Baiduri Energy - Indonesia
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Billiton Holdings Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Therma Luzon, Inc, Philippines
- Intertek Mineral Services - Indonesia
- Singapore Mercantile Exchange
- Attock Cement Pakistan Limited
- CIMB Investment Bank - Malaysia
- Standard Chartered Bank - UAE
- Rashtriya Ispat Nigam Limited - India
- Directorate Of Revenue Intelligence - India
- Global Coal Blending Company Limited - Australia
- Karbindo Abesyapradhi - Indoneisa
- Central Java Power - Indonesia
- SMG Consultants - Indonesia
- Australian Commodity Traders Exchange
- London Commodity Brokers - England
- Kalimantan Lumbung Energi - Indonesia
- Merrill Lynch Commodities Europe
- Jorong Barutama Greston.PT - Indonesia
- Mjunction Services Limited - India
- Timah Investasi Mineral - Indoneisa
- Electricity Generating Authority of Thailand
- New Zealand Coal & Carbon
- Interocean Group of Companies - India
- Sindya Power Generating Company Private Ltd
- Goldman Sachs - Singapore
- Miang Besar Coal Terminal - Indonesia
- Iligan Light & Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Uttam Galva Steels Limited - India
- Tamil Nadu electricity Board
- Bharathi Cement Corporation - India
- Power Finance Corporation Ltd., India
- Central Electricity Authority - India
- Makarim & Taira - Indonesia
- ICICI Bank Limited - India
- Bhushan Steel Limited - India
- Antam Resourcindo - Indonesia
- Deloitte Consulting - India
- IEA Clean Coal Centre - UK
- Indonesian Coal Mining Association
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- Indo Tambangraya Megah - Indonesia
- Thai Mozambique Logistica
- GN Power Mariveles Coal Plant, Philippines
- VISA Power Limited - India
- Eastern Coal Council - USA
- Kohat Cement Company Ltd. - Pakistan
- Straits Asia Resources Limited - Singapore
- Pendopo Energi Batubara - Indonesia
- Trasteel International SA, Italy
- Borneo Indobara - Indonesia
- Mercator Lines Limited - India
- Orica Australia Pty. Ltd.
- Mercuria Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Kaltim Prima Coal - Indonesia
- Malabar Cements Ltd - India
- Parry Sugars Refinery, India
- The Treasury - Australian Government
- Leighton Contractors Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- The State Trading Corporation of India Ltd
- Semirara Mining and Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Samtan Co., Ltd - South Korea
- Meenaskhi Energy Private Limited - India
- LBH Netherlands Bv - Netherlands
- Maheswari Brothers Coal Limited - India
- Manunggal Multi Energi - Indonesia
- Sojitz Corporation - Japan
- Karaikal Port Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
- Meralco Power Generation, Philippines
- Riau Bara Harum - Indonesia
- Madhucon Powers Ltd - India
- Metalloyd Limited - United Kingdom
- Australian Coal Association
- India Bulls Power Limited - India
- Vizag Seaport Private Limited - India
- San Jose City I Power Corp, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Bangladesh Power Developement Board
- Siam City Cement PLC, Thailand
- White Energy Company Limited
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- Kobexindo Tractors - Indoneisa
- Wilmar Investment Holdings
- Holcim Trading Pte Ltd - Singapore
- Siam City Cement - Thailand
- The University of Queensland
- Salva Resources Pvt Ltd - India
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