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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, 03 January 13
DRY BULK DEMAND TO KEEP RISING IN 2013, DRY BULK SHIP PRICES TO KEEP FALLING SAYS ANALYST - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
In a recent report on the future of the shipping markets, DVB bank said that dry bulk demand is expected to keep on growing in the coming years, mai ...
Wednesday, 02 January 13
NEWCASTLE PORT SHIPPED 23.61 PERCENT MORE COAL W-W
COALspot.com - Newcastle port in Australia has loaded 3,533,183 MT of thermal and coking coal for week ended 0700 hours 31 December 2012, Newc ...
Wednesday, 02 January 13
DRY BULK MARKET TO STAY ELEVATED IN START OF 2013 BUT THE NEW YEAR WILL NOT BE WITHOUT TURBULENCE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
In its regular update on the dry bulk market, BIMCO forecasted, that Capesize time-charter rates are expected to stay elevated in the following six ...
Monday, 31 December 12
KOSEP IS LOOKING FOR 280K MT OF 4600 NCV COAL FOR APRIL - JUNE 2013
COALspot.com : South Korean state-owned utility Korea South-East Power Co., Ltd. (KOSEP), has issued an new tender for prompt supply of 280,00 ...
Monday, 31 December 12
VALE CELEBRATES ARRIVAL OF "VALE SOHAR" BULK CARRIER TO SULTANATE WITH MEMBERS OF COMMUNITY
'Vale Sohar', one of the largest bulk carriers in the world, was welcomed to Oman by members of the North Al Batinah community headed by H.E. Shei ...
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- Thai Mozambique Logistica
- Latin American Coal - Colombia
- Meenaskhi Energy Private Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Savvy Resources Ltd - HongKong
- Star Paper Mills Limited - India
- Semirara Mining Corp, Philippines
- White Energy Company Limited
- International Coal Ventures Pvt Ltd - India
- Cement Manufacturers Association - India
- Bharathi Cement Corporation - India
- Iligan Light & Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- European Bulk Services B.V. - Netherlands
- Altura Mining Limited, Indonesia
- Trasteel International SA, Italy
- VISA Power Limited - India
- South Luzon Thermal Energy Corporation
- Mjunction Services Limited - India
- Mercuria Energy - Indonesia
- SMG Consultants - Indonesia
- Manunggal Multi Energi - Indonesia
- Madhucon Powers Ltd - India
- Georgia Ports Authority, United States
- PNOC Exploration Corporation - Philippines
- Agrawal Coal Company - India
- Merrill Lynch Commodities Europe
- Maheswari Brothers Coal Limited - India
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Standard Chartered Bank - UAE
- Malabar Cements Ltd - India
- Eastern Coal Council - USA
- Global Business Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Global Coal Blending Company Limited - Australia
- Sarangani Energy Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Deloitte Consulting - India
- Kaltim Prima Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- GMR Energy Limited - India
- Marubeni Corporation - India
- Wilmar Investment Holdings
- Bukit Makmur.PT - Indonesia
- San Jose City I Power Corp, Philippines
- Planning Commission, India
- Bangladesh Power Developement Board
- CNBM International Corporation - China
- Medco Energi Mining Internasional
- Sojitz Corporation - Japan
- Bhushan Steel Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Globalindo Alam Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- ICICI Bank Limited - India
- London Commodity Brokers - England
- GVK Power & Infra Limited - India
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Central Electricity Authority - India
- Vijayanagar Sugar Pvt Ltd - India
- Thiess Contractors Indonesia
- Global Green Power PLC Corporation, Philippines
- Renaissance Capital - South Africa
- Parry Sugars Refinery, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indian Energy Exchange, India
- PowerSource Philippines DevCo
- Sree Jayajothi Cements Limited - India
- Heidelberg Cement - Germany
- Gujarat Mineral Development Corp Ltd - India
- Chamber of Mines of South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Posco Energy - South Korea
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Ministry of Transport, Egypt
- Coal and Oil Company - UAE
- Minerals Council of Australia
- Vizag Seaport Private Limited - India
- Price Waterhouse Coopers - Russia
- Larsen & Toubro Limited - India
- Grasim Industreis Ltd - India
- Bayan Resources Tbk. - Indonesia
- Straits Asia Resources Limited - Singapore
- Antam Resourcindo - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Ministry of Finance - Indonesia
- Wood Mackenzie - Singapore
- Indian Oil Corporation Limited
- Borneo Indobara - Indonesia
- Samtan Co., Ltd - South Korea
- Indo Tambangraya Megah - Indonesia
- Electricity Generating Authority of Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jindal Steel & Power Ltd - India
- Makarim & Taira - Indonesia
- Sakthi Sugars Limited - India
- India Bulls Power Limited - India
- Formosa Plastics Group - Taiwan
- IHS Mccloskey Coal Group - USA
- Energy Link Ltd, New Zealand
- Sindya Power Generating Company Private Ltd
- Orica Australia Pty. Ltd.
- Rashtriya Ispat Nigam Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- Commonwealth Bank - Australia
- Baramulti Group, Indonesia
- Xindia Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Port Waratah Coal Services - Australia
- Mintek Dendrill Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Indonesian Coal Mining Association
- Maharashtra Electricity Regulatory Commission - India
- Power Finance Corporation Ltd., India
- Siam City Cement - Thailand
- Meralco Power Generation, Philippines
- PTC India Limited - India
- Coalindo Energy - Indonesia
- Electricity Authority, New Zealand
- The University of Queensland
- Kumho Petrochemical, South Korea
- Barasentosa Lestari - Indonesia
- Directorate Of Revenue Intelligence - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Edison Trading Spa - Italy
- Goldman Sachs - Singapore
- Gujarat Sidhee Cement - India
- Semirara Mining and Power Corporation, Philippines
- Independent Power Producers Association of India
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Coastal Gujarat Power Limited - India
- The State Trading Corporation of India Ltd
- Directorate General of MIneral and Coal - Indonesia
- IEA Clean Coal Centre - UK
- Bank of Tokyo Mitsubishi UFJ Ltd
- TeaM Sual Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Tata Chemicals Ltd - India
- SN Aboitiz Power Inc, Philippines
- The Treasury - Australian Government
- Bhatia International Limited - India
- Singapore Mercantile Exchange
- Gujarat Electricity Regulatory Commission - India
- PetroVietnam Power Coal Import and Supply Company
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ceylon Electricity Board - Sri Lanka
- McConnell Dowell - Australia
- Timah Investasi Mineral - Indoneisa
- Simpson Spence & Young - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Petron Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Romanian Commodities Exchange
- Karbindo Abesyapradhi - Indoneisa
- Australian Coal Association
- Rio Tinto Coal - Australia
- Central Java Power - Indonesia
- Siam City Cement PLC, Thailand
- Kohat Cement Company Ltd. - Pakistan
- CIMB Investment Bank - Malaysia
- Mercator Lines Limited - India
- Dalmia Cement Bharat India
- OPG Power Generation Pvt Ltd - India
- Energy Development Corp, Philippines
- Uttam Galva Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- Jaiprakash Power Ventures ltd
- Ind-Barath Power Infra Limited - India
- Ministry of Mines - Canada
- Oldendorff Carriers - Singapore
- Eastern Energy - Thailand
- New Zealand Coal & Carbon
- Ambuja Cements Ltd - India
- Indika Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bulk Trading Sa - Switzerland
- Essar Steel Hazira Ltd - India
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Economic Council, Georgia
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- SMC Global Power, Philippines
- Kepco SPC Power Corporation, Philippines
- Aditya Birla Group - India
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- Carbofer General Trading SA - India
- Banpu Public Company Limited - Thailand
- Sical Logistics Limited - India
- Karaikal Port Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Aboitiz Power Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Metalloyd Limited - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Parliament of New Zealand
- Africa Commodities Group - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Riau Bara Harum - Indonesia
- Australian Commodity Traders Exchange
- Attock Cement Pakistan Limited
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