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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, 05 February 13
NEWCASTLE PORT COAL SHIPMENTS DROPPED BY 10.77 PERCENT W-O-W
COALspot.com - Newcastle port in Australia has loaded 2,412,497 MT of thermal and coking coal for week ended 0700 hours 4 February 2013, Newca ...
Tuesday, 05 February 13
CHALLENGER DEEP RESOURCES CORP HAS ENTERED INTO AN EXCLUSIVE MINING AND MARKETING AGREEMENT WITH KEM
COALspot.com - Challenger Deep Resources Corp., through its wholly owned subsidiary, PT Bestindo Energy, has entered into an Exclusivity Agreement r ...
Saturday, 02 February 13
ADARO TO INTRODUCE A NEW BRAND OF ENVIROCOAL, E4700, IN 2013
COALspot.com - Adaro Energy, an Indonesian and leading coal producer in country has achieved a record coal production during 4Q12 of 13.31 mil ...
Saturday, 02 February 13
FREIGHT MARKET MAY REBOUND AFTER CHINESE NEW YEAR - VISTAAR
COALspot.com - The freight market was soft and all the indices were down by around 5-7 pct this week.
The BDI was down 6.01 pct closing at 750 po ...
Friday, 01 February 13
ORPHEUS SELLS B26 COAL PROJECTS FOR US$ 2 MILLION TO FOCUS ON SOUTH KALIMANTAN
COALspot.com - Orpheus Energy Limited (ASX: OEG) has announced that it has sold its 51 percent equity stake in the East Kalimantan coal projects, Bl ...
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- Uttam Galva Steels Limited - India
- Maheswari Brothers Coal Limited - India
- Planning Commission, India
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Sojitz Corporation - Japan
- Toyota Tsusho Corporation, Japan
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- Chamber of Mines of South Africa
- Trasteel International SA, Italy
- Ministry of Mines - Canada
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Lanco Infratech Ltd - India
- Petron Corporation, Philippines
- Sakthi Sugars Limited - India
- IHS Mccloskey Coal Group - USA
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Alfred C Toepfer International GmbH - Germany
- Videocon Industries ltd - India
- Mintek Dendrill Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Aboitiz Power Corporation - Philippines
- Wilmar Investment Holdings
- Dalmia Cement Bharat India
- Globalindo Alam Lestari - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercuria Energy - Indonesia
- Marubeni Corporation - India
- Posco Energy - South Korea
- International Coal Ventures Pvt Ltd - India
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- Kumho Petrochemical, South Korea
- Semirara Mining Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- London Commodity Brokers - England
- Port Waratah Coal Services - Australia
- Salva Resources Pvt Ltd - India
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- GVK Power & Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Parry Sugars Refinery, India
- Aditya Birla Group - India
- Bayan Resources Tbk. - Indonesia
- Timah Investasi Mineral - Indoneisa
- Indonesian Coal Mining Association
- MS Steel International - UAE
- Singapore Mercantile Exchange
- Miang Besar Coal Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Renaissance Capital - South Africa
- IEA Clean Coal Centre - UK
- Anglo American - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Holcim Trading Pte Ltd - Singapore
- Makarim & Taira - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Asmin Koalindo Tuhup - Indonesia
- Coalindo Energy - Indonesia
- Indian Energy Exchange, India
- Indo Tambangraya Megah - Indonesia
- Central Java Power - Indonesia
- Karaikal Port Pvt Ltd - India
- Baramulti Group, Indonesia
- Carbofer General Trading SA - India
- Sree Jayajothi Cements Limited - India
- Oldendorff Carriers - Singapore
- Commonwealth Bank - Australia
- Karbindo Abesyapradhi - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- Kideco Jaya Agung - Indonesia
- PTC India Limited - India
- Cigading International Bulk Terminal - Indonesia
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- Rashtriya Ispat Nigam Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Neyveli Lignite Corporation Ltd, - India
- Bahari Cakrawala Sebuku - Indonesia
- Savvy Resources Ltd - HongKong
- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- Economic Council, Georgia
- Thiess Contractors Indonesia
- Africa Commodities Group - South Africa
- Medco Energi Mining Internasional
- Bangladesh Power Developement Board
- Indian Oil Corporation Limited
- Ambuja Cements Ltd - India
- Wood Mackenzie - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Thai Mozambique Logistica
- Straits Asia Resources Limited - Singapore
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Kaltim Prima Coal - Indonesia
- Manunggal Multi Energi - Indonesia
- Essar Steel Hazira Ltd - India
- Merrill Lynch Commodities Europe
- Gujarat Sidhee Cement - India
- ICICI Bank Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- McConnell Dowell - Australia
- Coastal Gujarat Power Limited - India
- Riau Bara Harum - Indonesia
- SN Aboitiz Power Inc, Philippines
- Australian Commodity Traders Exchange
- Ministry of Transport, Egypt
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Mjunction Services Limited - India
- OPG Power Generation Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Agrawal Coal Company - India
- European Bulk Services B.V. - Netherlands
- GMR Energy Limited - India
- Jaiprakash Power Ventures ltd
- Standard Chartered Bank - UAE
- Price Waterhouse Coopers - Russia
- The University of Queensland
- Indogreen Group - Indonesia
- SMC Global Power, Philippines
- Global Business Power Corporation, Philippines
- Australian Coal Association
- Vedanta Resources Plc - India
- Bukit Baiduri Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Leighton Contractors Pty Ltd - Australia
- TeaM Sual Corporation - Philippines
- VISA Power Limited - India
- Meenaskhi Energy Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- The State Trading Corporation of India Ltd
- New Zealand Coal & Carbon
- San Jose City I Power Corp, Philippines
- Central Electricity Authority - India
- Mercator Lines Limited - India
- Power Finance Corporation Ltd., India
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Global Green Power PLC Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Tata Chemicals Ltd - India
- Bhushan Steel Limited - India
- Sarangani Energy Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Meralco Power Generation, Philippines
- Jindal Steel & Power Ltd - India
- Indika Energy - Indonesia
- Georgia Ports Authority, United States
- Edison Trading Spa - Italy
- Formosa Plastics Group - Taiwan
- Grasim Industreis Ltd - India
- Heidelberg Cement - Germany
- Eastern Coal Council - USA
- Sindya Power Generating Company Private Ltd
- Altura Mining Limited, Indonesia
- PNOC Exploration Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Antam Resourcindo - Indonesia
- Interocean Group of Companies - India
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Electricity Authority, New Zealand
- Romanian Commodities Exchange
- Maharashtra Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Borneo Indobara - Indonesia
- Madhucon Powers Ltd - India
- Kartika Selabumi Mining - Indonesia
- CNBM International Corporation - China
- Xindia Steels Limited - India
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- Eastern Energy - Thailand
- ASAPP Information Group - India
- Bhoruka Overseas - Indonesia
- Ind-Barath Power Infra Limited - India
- Barasentosa Lestari - Indonesia
- Coal and Oil Company - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- Larsen & Toubro Limited - India
- Directorate Of Revenue Intelligence - India
- Star Paper Mills Limited - India
- Deloitte Consulting - India
- Minerals Council of Australia
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- India Bulls Power Limited - India
- Latin American Coal - Colombia
- Intertek Mineral Services - Indonesia
- Metalloyd Limited - United Kingdom
- Kobexindo Tractors - Indoneisa
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Finance - Indonesia
- Electricity Generating Authority of Thailand
- Orica Mining Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement PLC, Thailand
- Independent Power Producers Association of India
- Global Coal Blending Company Limited - Australia
- AsiaOL BioFuels Corp., Philippines
- Kepco SPC Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Parliament of New Zealand
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