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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, 10 January 13
DRY BULK PANAMAX MARKET HEAVILY OVERSUPPLIED, UNLIKELY TO FIND SUPPORT IN 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite positive indication for a significant surge of dry bulk demand this year, the oversupply problems of the market, will continue to weigh heav ...
Tuesday, 08 January 13
HOLIDAY ACTIVITY SCARCE IN THE MARKET OF SECOND HAND VESSELS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Although the market for second hand vessel purchasing was quite lull during the Holiday period, as is usually the case, the first days of the New Ye ...
Tuesday, 08 January 13
NEWCASTLE PORT SHIPPED 3.197 MILLION MT OF COAL W/E 7 JANUARY 2013
COALspot.com - Newcastle port in Australia has loaded 3,197,580 MT of thermal and coking coal for week ended 0700 hours 7 January 2013, Newcas ...
Sunday, 06 January 13
CFR SOUTH CHINA COAL: 2014 DELIVERY CLOSED US$ 6.80 HIGHER THAN Q1 '13 PRICE
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average Q1’ 2013 delivery has gained 0.37 percent WoW and CFR South China coal sh ...
Sunday, 06 January 13
COAL BOOM: WAKE-UP CALL FOR INDIA & INDONESIA! - SUNIL K KUMBHAT
COALspot.com - Coal Boom : Scenario, Now & later!
Coal has been the dominant fuel for power generating plants in developed countries since th ...
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- Sree Jayajothi Cements Limited - India
- Posco Energy - South Korea
- Mjunction Services Limited - India
- London Commodity Brokers - England
- Lanco Infratech Ltd - India
- Indo Tambangraya Megah - Indonesia
- Semirara Mining Corp, Philippines
- Bharathi Cement Corporation - India
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Salva Resources Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Karaikal Port Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- ASAPP Information Group - India
- Sakthi Sugars Limited - India
- Straits Asia Resources Limited - Singapore
- Coalindo Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Interocean Group of Companies - India
- Vizag Seaport Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meralco Power Generation, Philippines
- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- Vedanta Resources Plc - India
- Siam City Cement PLC, Thailand
- Bulk Trading Sa - Switzerland
- Power Finance Corporation Ltd., India
- The University of Queensland
- Thiess Contractors Indonesia
- Dalmia Cement Bharat India
- Wood Mackenzie - Singapore
- Eastern Coal Council - USA
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Altura Mining Limited, Indonesia
- SN Aboitiz Power Inc, Philippines
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- Petron Corporation, Philippines
- Planning Commission, India
- Medco Energi Mining Internasional
- Sarangani Energy Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Kumho Petrochemical, South Korea
- Minerals Council of Australia
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- Electricity Generating Authority of Thailand
- Standard Chartered Bank - UAE
- Kobexindo Tractors - Indoneisa
- Sical Logistics Limited - India
- Simpson Spence & Young - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Merrill Lynch Commodities Europe
- Videocon Industries ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Barasentosa Lestari - Indonesia
- Jindal Steel & Power Ltd - India
- Central Electricity Authority - India
- Global Coal Blending Company Limited - Australia
- Miang Besar Coal Terminal - Indonesia
- IEA Clean Coal Centre - UK
- Trasteel International SA, Italy
- Malabar Cements Ltd - India
- Mercuria Energy - Indonesia
- GMR Energy Limited - India
- Coastal Gujarat Power Limited - India
- Siam City Cement - Thailand
- Intertek Mineral Services - Indonesia
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Price Waterhouse Coopers - Russia
- Asmin Koalindo Tuhup - Indonesia
- TeaM Sual Corporation - Philippines
- Renaissance Capital - South Africa
- Savvy Resources Ltd - HongKong
- Bayan Resources Tbk. - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Bangladesh Power Developement Board
- Bhoruka Overseas - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Energy Link Ltd, New Zealand
- Africa Commodities Group - South Africa
- Australian Commodity Traders Exchange
- SMC Global Power, Philippines
- Commonwealth Bank - Australia
- Madhucon Powers Ltd - India
- Parliament of New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Indika Energy - Indonesia
- GVK Power & Infra Limited - India
- Port Waratah Coal Services - Australia
- Global Green Power PLC Corporation, Philippines
- Ministry of Mines - Canada
- Eastern Energy - Thailand
- Baramulti Group, Indonesia
- Kaltim Prima Coal - Indonesia
- Singapore Mercantile Exchange
- Jaiprakash Power Ventures ltd
- Kideco Jaya Agung - Indonesia
- PowerSource Philippines DevCo
- PTC India Limited - India
- Aboitiz Power Corporation - Philippines
- SMG Consultants - Indonesia
- Thai Mozambique Logistica
- McConnell Dowell - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Pendopo Energi Batubara - Indonesia
- Xindia Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Indian Energy Exchange, India
- Sinarmas Energy and Mining - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Marubeni Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Larsen & Toubro Limited - India
- ICICI Bank Limited - India
- Billiton Holdings Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- Wilmar Investment Holdings
- Therma Luzon, Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Ministry of Finance - Indonesia
- Maheswari Brothers Coal Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Oldendorff Carriers - Singapore
- Meenaskhi Energy Private Limited - India
- Energy Development Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Orica Mining Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Agrawal Coal Company - India
- White Energy Company Limited
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Independent Power Producers Association of India
- Kalimantan Lumbung Energi - Indonesia
- Samtan Co., Ltd - South Korea
- Borneo Indobara - Indonesia
- Parry Sugars Refinery, India
- Banpu Public Company Limited - Thailand
- OPG Power Generation Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Chamber of Mines of South Africa
- PetroVietnam Power Coal Import and Supply Company
- Rio Tinto Coal - Australia
- Anglo American - United Kingdom
- Ind-Barath Power Infra Limited - India
- Economic Council, Georgia
- Bhushan Steel Limited - India
- Sojitz Corporation - Japan
- LBH Netherlands Bv - Netherlands
- New Zealand Coal & Carbon
- Edison Trading Spa - Italy
- India Bulls Power Limited - India
- Riau Bara Harum - Indonesia
- Carbofer General Trading SA - India
- Romanian Commodities Exchange
- International Coal Ventures Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Metalloyd Limited - United Kingdom
- Ceylon Electricity Board - Sri Lanka
- Directorate General of MIneral and Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Mercator Lines Limited - India
- CIMB Investment Bank - Malaysia
- Rashtriya Ispat Nigam Limited - India
- South Luzon Thermal Energy Corporation
- Binh Thuan Hamico - Vietnam
- Central Java Power - Indonesia
- Deloitte Consulting - India
- Latin American Coal - Colombia
- Coal and Oil Company - UAE
- Aditya Birla Group - India
- Cigading International Bulk Terminal - Indonesia
- The Treasury - Australian Government
- Tamil Nadu electricity Board
- Grasim Industreis Ltd - India
- Ministry of Transport, Egypt
- European Bulk Services B.V. - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Electricity Authority, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- Attock Cement Pakistan Limited
- Alfred C Toepfer International GmbH - Germany
- Bukit Makmur.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- Indonesian Coal Mining Association
- Indian Oil Corporation Limited
- Georgia Ports Authority, United States
- Mintek Dendrill Indonesia
- Tata Chemicals Ltd - India
- IHS Mccloskey Coal Group - USA
- PNOC Exploration Corporation - Philippines
- Antam Resourcindo - Indonesia
- Semirara Mining and Power Corporation, Philippines
- MS Steel International - UAE
- Formosa Plastics Group - Taiwan
- Star Paper Mills Limited - India
- Heidelberg Cement - Germany
- Indogreen Group - Indonesia
- VISA Power Limited - India
- Directorate Of Revenue Intelligence - India
- Ambuja Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
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