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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, 14 March 13
DRY BULK MARKET KEEPS ON RISING MOMENTUM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has maintained its rising momentum, on the back of increased cargo availability. According to yesterday's figures, the industry ...
Thursday, 14 March 13
SHIPPERS AND CARRIERS NEED GREATER COMMUNICATION AND MUTUAL UNDERSTANDING
Press Release – Shippers and shipping lines both need to raise their game if global container supply chains are not to be habitually subject t ...
Wednesday, 13 March 13
NEWBUILDING PRICES EXHIBIT NO FALL IN PAST SIX MONTHS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Despite the fact that oversupply has been the key plague of the shipping markets in recent years and newbuilding ordering activity has receded subst ...
Tuesday, 12 March 13
COAL MINING PRIVATIZATION IN INDIA: MUST - SUNIL K KUMBHAT
COALspot.com - India has the one of the richest coal reserves in the world and the country should have shown significant progress and gained the pos ...
Tuesday, 12 March 13
NEWCASTLE PORT SHIPPED 2.47 MILLION TONS OF COAL W/E 11 MARCH 2013
COALspot.com - Newcastle port in Australia has loaded 2,471,080 MT of thermal and coking coal for week ended 0700 hours 11 March 2013, Newcast ...
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- PTC India Limited - India
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- ICICI Bank Limited - India
- Romanian Commodities Exchange
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- Sakthi Sugars Limited - India
- Sarangani Energy Corporation, Philippines
- Petron Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Sindya Power Generating Company Private Ltd
- Kohat Cement Company Ltd. - Pakistan
- Vedanta Resources Plc - India
- Semirara Mining and Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Holcim Trading Pte Ltd - Singapore
- PowerSource Philippines DevCo
- Bhushan Steel Limited - India
- New Zealand Coal & Carbon
- GN Power Mariveles Coal Plant, Philippines
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- White Energy Company Limited
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- Cement Manufacturers Association - India
- Ministry of Finance - Indonesia
- Sinarmas Energy and Mining - Indonesia
- VISA Power Limited - India
- Mercator Lines Limited - India
- Planning Commission, India
- Standard Chartered Bank - UAE
- GMR Energy Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Coal Association
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Straits Asia Resources Limited - Singapore
- Central Java Power - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- GAC Shipping (India) Pvt Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Oldendorff Carriers - Singapore
- GVK Power & Infra Limited - India
- Sojitz Corporation - Japan
- Coalindo Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Wilmar Investment Holdings
- Malabar Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- South Luzon Thermal Energy Corporation
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- Aboitiz Power Corporation - Philippines
- Jindal Steel & Power Ltd - India
- Gujarat Sidhee Cement - India
- Indonesian Coal Mining Association
- Orica Mining Services - Indonesia
- Global Business Power Corporation, Philippines
- Thai Mozambique Logistica
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- Billiton Holdings Pty Ltd - Australia
- Cigading International Bulk Terminal - Indonesia
- Videocon Industries ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- The University of Queensland
- Ambuja Cements Ltd - India
- Bhoruka Overseas - Indonesia
- Rio Tinto Coal - Australia
- Georgia Ports Authority, United States
- Medco Energi Mining Internasional
- Therma Luzon, Inc, Philippines
- Singapore Mercantile Exchange
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- SMC Global Power, Philippines
- Agrawal Coal Company - India
- Marubeni Corporation - India
- Ind-Barath Power Infra Limited - India
- Salva Resources Pvt Ltd - India
- Renaissance Capital - South Africa
- Makarim & Taira - Indonesia
- Interocean Group of Companies - India
- Uttam Galva Steels Limited - India
- Heidelberg Cement - Germany
- PetroVietnam Power Coal Import and Supply Company
- Pipit Mutiara Jaya. PT, Indonesia
- Metalloyd Limited - United Kingdom
- Rashtriya Ispat Nigam Limited - India
- Samtan Co., Ltd - South Korea
- Trasteel International SA, Italy
- Bangladesh Power Developement Board
- Eastern Coal Council - USA
- Bhatia International Limited - India
- PNOC Exploration Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- San Jose City I Power Corp, Philippines
- Goldman Sachs - Singapore
- Price Waterhouse Coopers - Russia
- Banpu Public Company Limited - Thailand
- Globalindo Alam Lestari - Indonesia
- Attock Cement Pakistan Limited
- Orica Australia Pty. Ltd.
- Maheswari Brothers Coal Limited - India
- Formosa Plastics Group - Taiwan
- Kideco Jaya Agung - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Dalmia Cement Bharat India
- Wood Mackenzie - Singapore
- Tata Chemicals Ltd - India
- Simpson Spence & Young - Indonesia
- Coal and Oil Company - UAE
- IHS Mccloskey Coal Group - USA
- Anglo American - United Kingdom
- SMG Consultants - Indonesia
- Commonwealth Bank - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Borneo Indobara - Indonesia
- Economic Council, Georgia
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Kobexindo Tractors - Indoneisa
- Tamil Nadu electricity Board
- Toyota Tsusho Corporation, Japan
- Leighton Contractors Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Energy Development Corp, Philippines
- Minerals Council of Australia
- Lanco Infratech Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Central Electricity Authority - India
- Bayan Resources Tbk. - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- The State Trading Corporation of India Ltd
- Mercuria Energy - Indonesia
- Riau Bara Harum - Indonesia
- Baramulti Group, Indonesia
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Kalimantan Lumbung Energi - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Energy Link Ltd, New Zealand
- Sical Logistics Limited - India
- Jaiprakash Power Ventures ltd
- London Commodity Brokers - England
- Chettinad Cement Corporation Ltd - India
- Edison Trading Spa - Italy
- Larsen & Toubro Limited - India
- Directorate Of Revenue Intelligence - India
- Thiess Contractors Indonesia
- Alfred C Toepfer International GmbH - Germany
- Kaltim Prima Coal - Indonesia
- Madhucon Powers Ltd - India
- SN Aboitiz Power Inc, Philippines
- Vizag Seaport Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Port Waratah Coal Services - Australia
- LBH Netherlands Bv - Netherlands
- Electricity Generating Authority of Thailand
- Essar Steel Hazira Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Grasim Industreis Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Mintek Dendrill Indonesia
- Iligan Light & Power Inc, Philippines
- Indika Energy - Indonesia
- Indian Oil Corporation Limited
- Ministry of Transport, Egypt
- Barasentosa Lestari - Indonesia
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Independent Power Producers Association of India
- AsiaOL BioFuels Corp., Philippines
- TeaM Sual Corporation - Philippines
- Parry Sugars Refinery, India
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indogreen Group - Indonesia
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- Neyveli Lignite Corporation Ltd, - India
- Mjunction Services Limited - India
- Meenaskhi Energy Private Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Baiduri Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Merrill Lynch Commodities Europe
- Bharathi Cement Corporation - India
- IEA Clean Coal Centre - UK
- MS Steel International - UAE
- Indian Energy Exchange, India
- Electricity Authority, New Zealand
- Aditya Birla Group - India
- CNBM International Corporation - China
- Xindia Steels Limited - India
- Sree Jayajothi Cements Limited - India
- Meralco Power Generation, Philippines
- Ministry of Mines - Canada
- Siam City Cement - Thailand
- OPG Power Generation Pvt Ltd - India
- McConnell Dowell - Australia
- Antam Resourcindo - Indonesia
- Pendopo Energi Batubara - Indonesia
- Eastern Energy - Thailand
- International Coal Ventures Pvt Ltd - India
- India Bulls Power Limited - India
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