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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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Monday, 20 August 12
CHINESE COAL SWAPS RISE, INDONESIAN COAL CONTRACTS SOFT
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for October 2012 delivery lost -2.05 percent W-o-W on Friday (17 August 2012) closing but gained ...
Saturday, 18 August 12
BULK FREIGHT MARKETS CONTINUED THEIR DECLINE IN LINE WITH WEAK DEMAND - VISTAAR
COALspot.com - This week also the indices fell on all segments with BDI touching lowest in almost 3 years.
The BDI closed at 714 points down by 7 ...
Thursday, 16 August 12
PUBLIC PRIVATE PARTNERSHIPS CONFERENCE 2012
Press Release - Asia’s Premier Public Private Partnerships Conference 2012 will showcase commercial opportunities for investors and developers ...
Wednesday, 15 August 12
UT GENERATED RP 3.09 TRILLION NET INCOME
COALspot.com - As of June 2012 Indonesia’s heavy equipment market grew 14%, from 8,448 units to 9,618 units (based on UT’s internal mark ...
Tuesday, 14 August 12
SAKARI ENTERED INTO JV IN CAMBODIA TO EXPLORE COAL OPPORTUNITIES
COALspot.com - Sakari joints hands with The Royal Group of Companies in Cambodia to explore and develop coal opportunities throughout the country.
...
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- Energy Development Corp, Philippines
- Bhushan Steel Limited - India
- Miang Besar Coal Terminal - Indonesia
- Bulk Trading Sa - Switzerland
- Holcim Trading Pte Ltd - Singapore
- South Luzon Thermal Energy Corporation
- Indika Energy - Indonesia
- Indian Energy Exchange, India
- Parliament of New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Independent Power Producers Association of India
- Therma Luzon, Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Economic Council, Georgia
- Medco Energi Mining Internasional
- GAC Shipping (India) Pvt Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- Timah Investasi Mineral - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Electricity Authority, New Zealand
- IHS Mccloskey Coal Group - USA
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Green Power PLC Corporation, Philippines
- Australian Coal Association
- Maharashtra Electricity Regulatory Commission - India
- Gujarat Electricity Regulatory Commission - India
- Kaltim Prima Coal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Trasteel International SA, Italy
- Cigading International Bulk Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Madhucon Powers Ltd - India
- Kumho Petrochemical, South Korea
- Essar Steel Hazira Ltd - India
- Borneo Indobara - Indonesia
- Coal and Oil Company - UAE
- Global Coal Blending Company Limited - Australia
- Lanco Infratech Ltd - India
- Iligan Light & Power Inc, Philippines
- Ministry of Mines - Canada
- MS Steel International - UAE
- Leighton Contractors Pty Ltd - Australia
- Bhatia International Limited - India
- Sojitz Corporation - Japan
- Bayan Resources Tbk. - Indonesia
- India Bulls Power Limited - India
- Sree Jayajothi Cements Limited - India
- European Bulk Services B.V. - Netherlands
- Anglo American - United Kingdom
- Kobexindo Tractors - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- Agrawal Coal Company - India
- Standard Chartered Bank - UAE
- Kapuas Tunggal Persada - Indonesia
- Deloitte Consulting - India
- Attock Cement Pakistan Limited
- Altura Mining Limited, Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Commonwealth Bank - Australia
- Banpu Public Company Limited - Thailand
- Ministry of Transport, Egypt
- Posco Energy - South Korea
- Gujarat Sidhee Cement - India
- Romanian Commodities Exchange
- VISA Power Limited - India
- Simpson Spence & Young - Indonesia
- The State Trading Corporation of India Ltd
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- SMC Global Power, Philippines
- Parry Sugars Refinery, India
- Wilmar Investment Holdings
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Kohat Cement Company Ltd. - Pakistan
- Meenaskhi Energy Private Limited - India
- Straits Asia Resources Limited - Singapore
- Oldendorff Carriers - Singapore
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- The Treasury - Australian Government
- Makarim & Taira - Indonesia
- Indogreen Group - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Central Java Power - Indonesia
- Siam City Cement PLC, Thailand
- Rio Tinto Coal - Australia
- Neyveli Lignite Corporation Ltd, - India
- Eastern Energy - Thailand
- Vedanta Resources Plc - India
- Mercator Lines Limited - India
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- Goldman Sachs - Singapore
- Jindal Steel & Power Ltd - India
- Ambuja Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- CIMB Investment Bank - Malaysia
- Singapore Mercantile Exchange
- Larsen & Toubro Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Commodity Traders Exchange
- Toyota Tsusho Corporation, Japan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Mintek Dendrill Indonesia
- Central Electricity Authority - India
- Planning Commission, India
- Dalmia Cement Bharat India
- PTC India Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Indonesian Coal Mining Association
- Heidelberg Cement - Germany
- Metalloyd Limited - United Kingdom
- Baramulti Group, Indonesia
- Formosa Plastics Group - Taiwan
- Bhoruka Overseas - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- OPG Power Generation Pvt Ltd - India
- Orica Mining Services - Indonesia
- Carbofer General Trading SA - India
- Eastern Coal Council - USA
- Sakthi Sugars Limited - India
- Thai Mozambique Logistica
- PNOC Exploration Corporation - Philippines
- McConnell Dowell - Australia
- Merrill Lynch Commodities Europe
- The University of Queensland
- TeaM Sual Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Semirara Mining Corp, Philippines
- Orica Australia Pty. Ltd.
- Kideco Jaya Agung - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- Africa Commodities Group - South Africa
- PowerSource Philippines DevCo
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ICICI Bank Limited - India
- Star Paper Mills Limited - India
- Renaissance Capital - South Africa
- SMG Consultants - Indonesia
- White Energy Company Limited
- Ceylon Electricity Board - Sri Lanka
- Asmin Koalindo Tuhup - Indonesia
- Indo Tambangraya Megah - Indonesia
- Sical Logistics Limited - India
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- GMR Energy Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chamber of Mines of South Africa
- Electricity Generating Authority of Thailand
- Karbindo Abesyapradhi - Indoneisa
- Global Business Power Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Port Waratah Coal Services - Australia
- SN Aboitiz Power Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ind-Barath Power Infra Limited - India
- Malabar Cements Ltd - India
- Power Finance Corporation Ltd., India
- Price Waterhouse Coopers - Russia
- Minerals Council of Australia
- Indian Oil Corporation Limited
- Pendopo Energi Batubara - Indonesia
- LBH Netherlands Bv - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- CNBM International Corporation - China
- Wood Mackenzie - Singapore
- Uttam Galva Steels Limited - India
- Maheswari Brothers Coal Limited - India
- Savvy Resources Ltd - HongKong
- GVK Power & Infra Limited - India
- Grasim Industreis Ltd - India
- Tamil Nadu electricity Board
- Chettinad Cement Corporation Ltd - India
- IEA Clean Coal Centre - UK
- Intertek Mineral Services - Indonesia
- San Jose City I Power Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Thiess Contractors Indonesia
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Barasentosa Lestari - Indonesia
- Marubeni Corporation - India
- Ministry of Finance - Indonesia
- Aboitiz Power Corporation - Philippines
- Salva Resources Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Sarangani Energy Corporation, Philippines
- Tata Chemicals Ltd - India
- Bharathi Cement Corporation - India
- Karaikal Port Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Georgia Ports Authority, United States
- Videocon Industries ltd - India
- Alfred C Toepfer International GmbH - Germany
- Antam Resourcindo - Indonesia
- Petron Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Rashtriya Ispat Nigam Limited - India
- PetroVietnam Power Coal Import and Supply Company
- London Commodity Brokers - England
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Mercuria Energy - Indonesia
- Bangladesh Power Developement Board
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