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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, 04 December 12
JATENERGY SIGNS MOU FOR INDONESIAN COAL ASSET
COALspot.com - Jatenergy Limited has announced that its fully-owned Indonesian subsidiary, PT Barata Energy (BE), has signed an exclusive, non-bindi ...
Tuesday, 04 December 12
NEWCASTLE PORT SHIPPED 55.88 PERCENT MORE COAL W/E 3 DECEMBER 2012
COALspot.com - Newcastle port in Australia has loaded 2,796,341 MT of thermal and coking coal for week ended 0700 hours 3 December 2012, Newca ...
Sunday, 02 December 12
YEAR 2013, YEAR OF SUPPLY OR DEMAND?
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average Q1 2013 delivery gained 2.87 & 0.83 percent MoM and WoW respectively ...
Saturday, 01 December 12
TIGHT SUPPLY, DEMAND PUSH INDO-INDIA SUPRAMAX FREIGHT RATES HIGHER - VISTAAR
COALspot.com - The freight market was mixed this week as cape and Panamax indices are closing softer.
The BDI was down 0.37 pct closing at 1,086 ...
Friday, 30 November 12
FUTURE TREND OF SECOND HAND SHIP VALUES PUZZLING SHIP OWNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
One of the major challenges that ship owners are facing today is whether or not to invest in a second hand vessel at any given time. For instance, i ...
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- Electricity Authority, New Zealand
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- PowerSource Philippines DevCo
- Indian Oil Corporation Limited
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- Neyveli Lignite Corporation Ltd, - India
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- Alfred C Toepfer International GmbH - Germany
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- Pipit Mutiara Jaya. PT, Indonesia
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- Chettinad Cement Corporation Ltd - India
- Bhushan Steel Limited - India
- Standard Chartered Bank - UAE
- Power Finance Corporation Ltd., India
- White Energy Company Limited
- Commonwealth Bank - Australia
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- Formosa Plastics Group - Taiwan
- Central Electricity Authority - India
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- Sindya Power Generating Company Private Ltd
- Jorong Barutama Greston.PT - Indonesia
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- Petrochimia International Co. Ltd.- Taiwan
- Wood Mackenzie - Singapore
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- Kohat Cement Company Ltd. - Pakistan
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Salva Resources Pvt Ltd - India
- Medco Energi Mining Internasional
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- SMC Global Power, Philippines
- Petron Corporation, Philippines
- Renaissance Capital - South Africa
- CNBM International Corporation - China
- Carbofer General Trading SA - India
- Thai Mozambique Logistica
- Economic Council, Georgia
- CIMB Investment Bank - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Mining Services - Indonesia
- Ministry of Transport, Egypt
- Globalindo Alam Lestari - Indonesia
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vizag Seaport Private Limited - India
- Energy Development Corp, Philippines
- New Zealand Coal & Carbon
- Toyota Tsusho Corporation, Japan
- Savvy Resources Ltd - HongKong
- Interocean Group of Companies - India
- Aditya Birla Group - India
- European Bulk Services B.V. - Netherlands
- Ministry of Mines - Canada
- Indogreen Group - Indonesia
- Barasentosa Lestari - Indonesia
- Baramulti Group, Indonesia
- Jindal Steel & Power Ltd - India
- Madhucon Powers Ltd - India
- Therma Luzon, Inc, Philippines
- Videocon Industries ltd - India
- Sical Logistics Limited - India
- ASAPP Information Group - India
- Directorate Of Revenue Intelligence - India
- Indika Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Eastern Coal Council - USA
- Leighton Contractors Pty Ltd - Australia
- Central Java Power - Indonesia
- OPG Power Generation Pvt Ltd - India
- SMG Consultants - Indonesia
- Rio Tinto Coal - Australia
- Price Waterhouse Coopers - Russia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Semirara Mining and Power Corporation, Philippines
- Deloitte Consulting - India
- Straits Asia Resources Limited - Singapore
- Karaikal Port Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Electricity Generating Authority of Thailand
- International Coal Ventures Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Billiton Holdings Pty Ltd - Australia
- Pendopo Energi Batubara - Indonesia
- Ambuja Cements Ltd - India
- GMR Energy Limited - India
- Sarangani Energy Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Anglo American - United Kingdom
- Tamil Nadu electricity Board
- Thiess Contractors Indonesia
- Africa Commodities Group - South Africa
- Merrill Lynch Commodities Europe
- Manunggal Multi Energi - Indonesia
- Planning Commission, India
- Malabar Cements Ltd - India
- Mjunction Services Limited - India
- GN Power Mariveles Coal Plant, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Star Paper Mills Limited - India
- Binh Thuan Hamico - Vietnam
- Banpu Public Company Limited - Thailand
- PNOC Exploration Corporation - Philippines
- Agrawal Coal Company - India
- TeaM Sual Corporation - Philippines
- Latin American Coal - Colombia
- Uttam Galva Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- Asmin Koalindo Tuhup - Indonesia
- Sree Jayajothi Cements Limited - India
- Vedanta Resources Plc - India
- Cement Manufacturers Association - India
- Global Business Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- The State Trading Corporation of India Ltd
- Kobexindo Tractors - Indoneisa
- Mercuria Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Trasteel International SA, Italy
- Jaiprakash Power Ventures ltd
- Gujarat Mineral Development Corp Ltd - India
- Meralco Power Generation, Philippines
- Eastern Energy - Thailand
- Singapore Mercantile Exchange
- Timah Investasi Mineral - Indoneisa
- Bhatia International Limited - India
- Simpson Spence & Young - Indonesia
- Borneo Indobara - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Posco Energy - South Korea
- Gujarat Electricity Regulatory Commission - India
- The University of Queensland
- Goldman Sachs - Singapore
- Wilmar Investment Holdings
- Ministry of Finance - Indonesia
- Lanco Infratech Ltd - India
- Meenaskhi Energy Private Limited - India
- PTC India Limited - India
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- McConnell Dowell - Australia
- Siam City Cement - Thailand
- Bukit Baiduri Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Holcim Trading Pte Ltd - Singapore
- LBH Netherlands Bv - Netherlands
- Oldendorff Carriers - Singapore
- MS Steel International - UAE
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- IEA Clean Coal Centre - UK
- Indian Energy Exchange, India
- Heidelberg Cement - Germany
- Orica Australia Pty. Ltd.
- Indonesian Coal Mining Association
- Port Waratah Coal Services - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coastal Gujarat Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Bharathi Cement Corporation - India
- IHS Mccloskey Coal Group - USA
- India Bulls Power Limited - India
- Dalmia Cement Bharat India
- Makarim & Taira - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Parliament of New Zealand
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- Energy Link Ltd, New Zealand
- Bukit Makmur.PT - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Minerals Council of Australia
- Cigading International Bulk Terminal - Indonesia
- GVK Power & Infra Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Australian Commodity Traders Exchange
- Coalindo Energy - Indonesia
- Maheswari Brothers Coal Limited - India
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