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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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Sunday, 23 September 12
AN ANOTHER UNSTABLE WEEK FOR INDONESIAN COAL SWAPS
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for November 2012 delivery lost 1.10 percent and 0.916 percent WOW and DOD respectively ...
Sunday, 23 September 12
INDIA IMPORTED 11.40 PERCENT MORE INDONESIAN COAL IN AUGUST
COALspot.com: Indonesia, the world largest multi grade coal exporter, shipped 26,451,565* tons of coal in August 2012, compared to 27.88* mill ...
Saturday, 22 September 12
SOFT BUNKER PRICES KEEP INDONESIA TO INDIA FREIGHTS STABLE - VISTAAR
COALspot.com - The freight market overall remained buoyant with all indices up except for Panamax index. The main effect seems to be increased shipm ...
Friday, 21 September 12
SHIP BREAKING ACTIVITY REACHES NEW RECORDS, AS ALREADY 2012 LEVELS HAVE SURPASSED THE WHOLE OF 2011 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The vast oversupply of vessels, most notably in the dry bulk shipping sector, has forced ship owners to intensify their efforts towards recycling th ...
Thursday, 20 September 12
SUPRAMAX : INDO-INDIA ROUNDS WERE AROUND USD 12K - FEARNLEYS
Handy
Not a bad week for Supramax tonnage, if we compare Supramax developments to the bigger size tonnage. The rates have basically remained unchan ...
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- Bukit Baiduri Energy - Indonesia
- Central Java Power - Indonesia
- Leighton Contractors Pty Ltd - Australia
- CNBM International Corporation - China
- Pipit Mutiara Jaya. PT, Indonesia
- Sree Jayajothi Cements Limited - India
- Mjunction Services Limited - India
- Romanian Commodities Exchange
- Rashtriya Ispat Nigam Limited - India
- Agrawal Coal Company - India
- Aboitiz Power Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- Standard Chartered Bank - UAE
- Georgia Ports Authority, United States
- Posco Energy - South Korea
- Uttam Galva Steels Limited - India
- Kepco SPC Power Corporation, Philippines
- Bhatia International Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Karbindo Abesyapradhi - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PNOC Exploration Corporation - Philippines
- Wilmar Investment Holdings
- Altura Mining Limited, Indonesia
- Bhushan Steel Limited - India
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- Eastern Energy - Thailand
- Tata Chemicals Ltd - India
- Indo Tambangraya Megah - Indonesia
- Ambuja Cements Ltd - India
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- Thiess Contractors Indonesia
- Bulk Trading Sa - Switzerland
- Orica Mining Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Manunggal Multi Energi - Indonesia
- Orica Australia Pty. Ltd.
- Ind-Barath Power Infra Limited - India
- Coalindo Energy - Indonesia
- Barasentosa Lestari - Indonesia
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- Straits Asia Resources Limited - Singapore
- Iligan Light & Power Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Goldman Sachs - Singapore
- TeaM Sual Corporation - Philippines
- Oldendorff Carriers - Singapore
- Kartika Selabumi Mining - Indonesia
- Heidelberg Cement - Germany
- Holcim Trading Pte Ltd - Singapore
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Essar Steel Hazira Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Star Paper Mills Limited - India
- The University of Queensland
- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- Borneo Indobara - Indonesia
- Singapore Mercantile Exchange
- India Bulls Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Edison Trading Spa - Italy
- Sojitz Corporation - Japan
- Cigading International Bulk Terminal - Indonesia
- Sindya Power Generating Company Private Ltd
- SN Aboitiz Power Inc, Philippines
- Meralco Power Generation, Philippines
- Deloitte Consulting - India
- Gujarat Sidhee Cement - India
- The Treasury - Australian Government
- White Energy Company Limited
- OPG Power Generation Pvt Ltd - India
- SMC Global Power, Philippines
- Mintek Dendrill Indonesia
- Australian Coal Association
- Minerals Council of Australia
- Mercuria Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Therma Luzon, Inc, Philippines
- Lanco Infratech Ltd - India
- Electricity Authority, New Zealand
- Larsen & Toubro Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Coal and Oil Company - UAE
- Ministry of Transport, Egypt
- Aditya Birla Group - India
- Petrochimia International Co. Ltd.- Taiwan
- Energy Link Ltd, New Zealand
- GAC Shipping (India) Pvt Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- London Commodity Brokers - England
- Australian Commodity Traders Exchange
- Meenaskhi Energy Private Limited - India
- Kapuas Tunggal Persada - Indonesia
- Power Finance Corporation Ltd., India
- Parliament of New Zealand
- Siam City Cement - Thailand
- Economic Council, Georgia
- ASAPP Information Group - India
- Renaissance Capital - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Indonesian Coal Mining Association
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Business Power Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Videocon Industries ltd - India
- Cement Manufacturers Association - India
- European Bulk Services B.V. - Netherlands
- Chettinad Cement Corporation Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Commonwealth Bank - Australia
- Indian Energy Exchange, India
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Banpu Public Company Limited - Thailand
- MS Steel International - UAE
- Attock Cement Pakistan Limited
- Intertek Mineral Services - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Sakthi Sugars Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Port Waratah Coal Services - Australia
- Xindia Steels Limited - India
- Maheswari Brothers Coal Limited - India
- Siam City Cement PLC, Thailand
- Savvy Resources Ltd - HongKong
- Latin American Coal - Colombia
- Ceylon Electricity Board - Sri Lanka
- Anglo American - United Kingdom
- Independent Power Producers Association of India
- Ministry of Mines - Canada
- GMR Energy Limited - India
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Antam Resourcindo - Indonesia
- Africa Commodities Group - South Africa
- Indogreen Group - Indonesia
- Mercator Lines Limited - India
- Indian Oil Corporation Limited
- Central Electricity Authority - India
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Karaikal Port Pvt Ltd - India
- Parry Sugars Refinery, India
- Malabar Cements Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Carbofer General Trading SA - India
- Globalindo Alam Lestari - Indonesia
- Eastern Coal Council - USA
- Tamil Nadu electricity Board
- Rio Tinto Coal - Australia
- TNB Fuel Sdn Bhd - Malaysia
- PetroVietnam Power Coal Import and Supply Company
- McConnell Dowell - Australia
- Kideco Jaya Agung - Indonesia
- Binh Thuan Hamico - Vietnam
- Toyota Tsusho Corporation, Japan
- Trasteel International SA, Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GVK Power & Infra Limited - India
- Baramulti Group, Indonesia
- Bharathi Cement Corporation - India
- Thai Mozambique Logistica
- Madhucon Powers Ltd - India
- Bukit Makmur.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- LBH Netherlands Bv - Netherlands
- Asmin Koalindo Tuhup - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Riau Bara Harum - Indonesia
- Dalmia Cement Bharat India
- ICICI Bank Limited - India
- Krishnapatnam Port Company Ltd. - India
- Planning Commission, India
- Price Waterhouse Coopers - Russia
- Global Green Power PLC Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Semirara Mining and Power Corporation, Philippines
- Makarim & Taira - Indonesia
- Indika Energy - Indonesia
- VISA Power Limited - India
- Petron Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Sical Logistics Limited - India
- Wood Mackenzie - Singapore
- Vedanta Resources Plc - India
- Bangladesh Power Developement Board
- Kobexindo Tractors - Indoneisa
- Merrill Lynch Commodities Europe
- Marubeni Corporation - India
- The State Trading Corporation of India Ltd
- Maharashtra Electricity Regulatory Commission - India
- Grasim Industreis Ltd - India
- Vizag Seaport Private Limited - India
- New Zealand Coal & Carbon
- Samtan Co., Ltd - South Korea
- Energy Development Corp, Philippines
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