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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, 03 July 12
DRY BULK MARKET INCHED FORWARD AT THE START OF THE WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market inched forward at the beginning of the new week, prior to the US holidays regarding the celebration of the 4th of July, which is ...
Monday, 02 July 12
ORPHEUS STRENGTHENS REVENUE STREAM WITH NEW ROYALTY AGREEMENT AT THE B2 COAL PROJECT
Orpheus Energy (ASX:OEG) is pleased to advise that it has executed a life of mine Royalty Agreement with Indonesian mining contractor PT Debbia Mini ...
Monday, 02 July 12
DRY BULK DEMAND TO RISE TO 3.6 BILLION TONNES IN 2012, BUT NEW BUILDING DELIVERIES ARE
In its latest analysis on the dry bulk market fundamentals, DVB Bank said that dry bulk cargo demand is forecast to rise to approximately 3.6 billio ...
Sunday, 01 July 12
AUSTRALIAS CARBON TAX - SUNIL K KUMBHAT
COALspot.com - Climate Change
Climate change and global warming have now become buzzwords the world over. The disastrous consequences for global ...
Sunday, 01 July 12
DSP OF SGX ASIACLEAR OTC COAL SWAP'S THIS WEEKS MOVEMENTS SLIGHTLY POSITIVE
COALspot.com - SGX AsiaClear OTC Coal Swaps have recovered slightly this week and Q4 deliveries are also showing positive direction.
SGX’s ...
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- Altura Mining Limited, Indonesia
- Ministry of Transport, Egypt
- Energy Link Ltd, New Zealand
- ICICI Bank Limited - India
- Interocean Group of Companies - India
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Finance - Indonesia
- Straits Asia Resources Limited - Singapore
- European Bulk Services B.V. - Netherlands
- Sical Logistics Limited - India
- Agrawal Coal Company - India
- Lanco Infratech Ltd - India
- Essar Steel Hazira Ltd - India
- Larsen & Toubro Limited - India
- Dalmia Cement Bharat India
- Vijayanagar Sugar Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- SN Aboitiz Power Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vedanta Resources Plc - India
- Karbindo Abesyapradhi - Indoneisa
- Meralco Power Generation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Marubeni Corporation - India
- Indo Tambangraya Megah - Indonesia
- Therma Luzon, Inc, Philippines
- Siam City Cement - Thailand
- AsiaOL BioFuels Corp., Philippines
- Bhushan Steel Limited - India
- Thai Mozambique Logistica
- Malabar Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- Cement Manufacturers Association - India
- Mercuria Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- LBH Netherlands Bv - Netherlands
- Price Waterhouse Coopers - Russia
- Bharathi Cement Corporation - India
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- Tata Chemicals Ltd - India
- Gujarat Sidhee Cement - India
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Maharashtra Electricity Regulatory Commission - India
- Heidelberg Cement - Germany
- Grasim Industreis Ltd - India
- GVK Power & Infra Limited - India
- Vizag Seaport Private Limited - India
- International Coal Ventures Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Ceylon Electricity Board - Sri Lanka
- Xindia Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Electricity Authority, New Zealand
- Medco Energi Mining Internasional
- Madhucon Powers Ltd - India
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- Indika Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- SMC Global Power, Philippines
- Gujarat Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Mjunction Services Limited - India
- Global Coal Blending Company Limited - Australia
- Riau Bara Harum - Indonesia
- Sakthi Sugars Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Star Paper Mills Limited - India
- Bangladesh Power Developement Board
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- Orica Australia Pty. Ltd.
- Baramulti Group, Indonesia
- Jaiprakash Power Ventures ltd
- Antam Resourcindo - Indonesia
- Ambuja Cements Ltd - India
- Singapore Mercantile Exchange
- Mercator Lines Limited - India
- Bhoruka Overseas - Indonesia
- Chamber of Mines of South Africa
- Deloitte Consulting - India
- Bukit Baiduri Energy - Indonesia
- Minerals Council of Australia
- Latin American Coal - Colombia
- Videocon Industries ltd - India
- Electricity Generating Authority of Thailand
- Coalindo Energy - Indonesia
- Planning Commission, India
- Eastern Coal Council - USA
- PTC India Limited - India
- Miang Besar Coal Terminal - Indonesia
- Georgia Ports Authority, United States
- Wilmar Investment Holdings
- Rashtriya Ispat Nigam Limited - India
- Mintek Dendrill Indonesia
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Indogreen Group - Indonesia
- Coastal Gujarat Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- TNB Fuel Sdn Bhd - Malaysia
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- PowerSource Philippines DevCo
- Jindal Steel & Power Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sree Jayajothi Cements Limited - India
- Meenaskhi Energy Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Commonwealth Bank - Australia
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- SMG Consultants - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhatia International Limited - India
- Merrill Lynch Commodities Europe
- CNBM International Corporation - China
- Semirara Mining and Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Renaissance Capital - South Africa
- Aditya Birla Group - India
- Kohat Cement Company Ltd. - Pakistan
- Attock Cement Pakistan Limited
- CIMB Investment Bank - Malaysia
- Australian Coal Association
- South Luzon Thermal Energy Corporation
- Krishnapatnam Port Company Ltd. - India
- Central Electricity Authority - India
- Global Business Power Corporation, Philippines
- ASAPP Information Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Makarim & Taira - Indonesia
- Parry Sugars Refinery, India
- VISA Power Limited - India
- OPG Power Generation Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Indian Oil Corporation Limited
- Parliament of New Zealand
- Manunggal Multi Energi - Indonesia
- IEA Clean Coal Centre - UK
- Indian Energy Exchange, India
- Economic Council, Georgia
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Independent Power Producers Association of India
- Jorong Barutama Greston.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- IHS Mccloskey Coal Group - USA
- Thiess Contractors Indonesia
- Port Waratah Coal Services - Australia
- Posco Energy - South Korea
- Ministry of Mines - Canada
- Australian Commodity Traders Exchange
- The Treasury - Australian Government
- GN Power Mariveles Coal Plant, Philippines
- Standard Chartered Bank - UAE
- GAC Shipping (India) Pvt Ltd
- Banpu Public Company Limited - Thailand
- New Zealand Coal & Carbon
- Semirara Mining Corp, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Ind-Barath Power Infra Limited - India
- Siam City Cement PLC, Thailand
- Eastern Energy - Thailand
- India Bulls Power Limited - India
- The State Trading Corporation of India Ltd
- McConnell Dowell - Australia
- GMR Energy Limited - India
- Kapuas Tunggal Persada - Indonesia
- Petron Corporation, Philippines
- Indonesian Coal Mining Association
- PNOC Exploration Corporation - Philippines
- Holcim Trading Pte Ltd - Singapore
- Sojitz Corporation - Japan
- Tamil Nadu electricity Board
- Trasteel International SA, Italy
- Goldman Sachs - Singapore
- MS Steel International - UAE
- Anglo American - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- Kideco Jaya Agung - Indonesia
- Barasentosa Lestari - Indonesia
- Karaikal Port Pvt Ltd - India
- Energy Development Corp, Philippines
- Simpson Spence & Young - Indonesia
- Samtan Co., Ltd - South Korea
- Wood Mackenzie - Singapore
- London Commodity Brokers - England
- Iligan Light & Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Africa Commodities Group - South Africa
- Carbofer General Trading SA - India
- Kepco SPC Power Corporation, Philippines
- Edison Trading Spa - Italy
- Central Java Power - Indonesia
- Salva Resources Pvt Ltd - India
- Borneo Indobara - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Oldendorff Carriers - Singapore
- San Jose City I Power Corp, Philippines
- Uttam Galva Steels Limited - India
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