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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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Friday, 22 June 12
COAL: THE BACKBONE OF MODERN ELECTRICITY - ECOAL
Coal has been described as the "forgotten fuel," perhaps because many aren't aware of the huge role it plays in powering the global econo ...
Thursday, 21 June 12
DRY BULK MARKET ON THE RISE AGAIN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market was on the rise once again yesterday, with the Baltic Dry Index (BDI), the industry’s benchmark, rising by 18 points, or 1 ...
Wednesday, 20 June 12
BDI MOVING HIGHER, PANAMAX AND SUPRAMAX VESSELS STRONGER, CAPESIZE RATES NEAR TO HISTORICAL LOWS OF DECEMBER 2008 - MARIA BERTZELETOU, HELLENIC SHIPPING
The dry market seems to follow the dynamic of the previous week with the Baltic Dry Index showing daily increases since June 8th, but is still stand ...
Tuesday, 19 June 12
SMALLER DRY BULK CARRIERS LIFT UP MARKET, PANAMAXES SET TO FALL SAYS ANALYST - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Another rise for the dry bulk market was evident yesterday, as the industry’s benchmark, the BDI (Baltic Dry Index) was up for a ninth straigh ...
Sunday, 17 June 12
S7 & S8 ROUTES ARE LIKELY TO BE SOFT NEXT WEEK - VISTAAR
COALspot.com - The BDI gained some increase after continues fall for several weeks.
The BDI increased by 47 points (up by 5.36 pct) closing at 92 ...
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- Petron Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Ambuja Cements Ltd - India
- Standard Chartered Bank - UAE
- Wood Mackenzie - Singapore
- Parry Sugars Refinery, India
- SN Aboitiz Power Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Gujarat Sidhee Cement - India
- The University of Queensland
- Directorate Of Revenue Intelligence - India
- Chettinad Cement Corporation Ltd - India
- Uttam Galva Steels Limited - India
- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bhatia International Limited - India
- San Jose City I Power Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Samtan Co., Ltd - South Korea
- Tamil Nadu electricity Board
- Marubeni Corporation - India
- Kartika Selabumi Mining - Indonesia
- Ministry of Finance - Indonesia
- Semirara Mining Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- India Bulls Power Limited - India
- Siam City Cement PLC, Thailand
- Kapuas Tunggal Persada - Indonesia
- Bayan Resources Tbk. - Indonesia
- Coal and Oil Company - UAE
- The State Trading Corporation of India Ltd
- Romanian Commodities Exchange
- PTC India Limited - India
- LBH Netherlands Bv - Netherlands
- Thiess Contractors Indonesia
- Banpu Public Company Limited - Thailand
- Renaissance Capital - South Africa
- SMC Global Power, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Lanco Infratech Ltd - India
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- Coalindo Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Jaiprakash Power Ventures ltd
- Eastern Energy - Thailand
- CNBM International Corporation - China
- Indian Energy Exchange, India
- Mercuria Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Australian Commodity Traders Exchange
- Planning Commission, India
- Sojitz Corporation - Japan
- Bukit Baiduri Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Africa Commodities Group - South Africa
- Bharathi Cement Corporation - India
- The Treasury - Australian Government
- Bangladesh Power Developement Board
- Coastal Gujarat Power Limited - India
- Indonesian Coal Mining Association
- Holcim Trading Pte Ltd - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Mjunction Services Limited - India
- Maheswari Brothers Coal Limited - India
- Orica Mining Services - Indonesia
- Cement Manufacturers Association - India
- Attock Cement Pakistan Limited
- Energy Link Ltd, New Zealand
- Barasentosa Lestari - Indonesia
- Videocon Industries ltd - India
- Bulk Trading Sa - Switzerland
- Chamber of Mines of South Africa
- Jindal Steel & Power Ltd - India
- GVK Power & Infra Limited - India
- Georgia Ports Authority, United States
- Star Paper Mills Limited - India
- Grasim Industreis Ltd - India
- Price Waterhouse Coopers - Russia
- Baramulti Group, Indonesia
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- South Luzon Thermal Energy Corporation
- Latin American Coal - Colombia
- SMG Consultants - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Singapore Mercantile Exchange
- Commonwealth Bank - Australia
- Ministry of Transport, Egypt
- McConnell Dowell - Australia
- Meralco Power Generation, Philippines
- Kaltim Prima Coal - Indonesia
- Edison Trading Spa - Italy
- Miang Besar Coal Terminal - Indonesia
- Trasteel International SA, Italy
- Global Coal Blending Company Limited - Australia
- Medco Energi Mining Internasional
- Semirara Mining and Power Corporation, Philippines
- Sakthi Sugars Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- PetroVietnam Power Coal Import and Supply Company
- Aditya Birla Group - India
- London Commodity Brokers - England
- Central Electricity Authority - India
- Billiton Holdings Pty Ltd - Australia
- Global Business Power Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Mercator Lines Limited - India
- Australian Coal Association
- Karaikal Port Pvt Ltd - India
- GMR Energy Limited - India
- Goldman Sachs - Singapore
- Therma Luzon, Inc, Philippines
- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- Sindya Power Generating Company Private Ltd
- Parliament of New Zealand
- ICICI Bank Limited - India
- Kideco Jaya Agung - Indonesia
- Global Green Power PLC Corporation, Philippines
- Anglo American - United Kingdom
- Bhoruka Overseas - Indonesia
- MS Steel International - UAE
- Borneo Indobara - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Power Finance Corporation Ltd., India
- Rashtriya Ispat Nigam Limited - India
- Leighton Contractors Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Malabar Cements Ltd - India
- Merrill Lynch Commodities Europe
- Ind-Barath Power Infra Limited - India
- Sinarmas Energy and Mining - Indonesia
- Heidelberg Cement - Germany
- Kohat Cement Company Ltd. - Pakistan
- Mintek Dendrill Indonesia
- Oldendorff Carriers - Singapore
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- Bhushan Steel Limited - India
- IHS Mccloskey Coal Group - USA
- Ministry of Mines - Canada
- Indika Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Riau Bara Harum - Indonesia
- Central Java Power - Indonesia
- White Energy Company Limited
- Manunggal Multi Energi - Indonesia
- Pendopo Energi Batubara - Indonesia
- Meenaskhi Energy Private Limited - India
- Sical Logistics Limited - India
- Antam Resourcindo - Indonesia
- Deloitte Consulting - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sree Jayajothi Cements Limited - India
- Intertek Mineral Services - Indonesia
- Straits Asia Resources Limited - Singapore
- Larsen & Toubro Limited - India
- CIMB Investment Bank - Malaysia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sarangani Energy Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Rio Tinto Coal - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indo Tambangraya Megah - Indonesia
- Bukit Makmur.PT - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Indogreen Group - Indonesia
- International Coal Ventures Pvt Ltd - India
- Thai Mozambique Logistica
- Electricity Authority, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Posco Energy - South Korea
- Siam City Cement - Thailand
- Directorate General of MIneral and Coal - Indonesia
- TeaM Sual Corporation - Philippines
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Eastern Coal Council - USA
- PowerSource Philippines DevCo
- ASAPP Information Group - India
- Vedanta Resources Plc - India
- Simpson Spence & Young - Indonesia
- European Bulk Services B.V. - Netherlands
- Makarim & Taira - Indonesia
- Formosa Plastics Group - Taiwan
- Altura Mining Limited, Indonesia
- Metalloyd Limited - United Kingdom
- Offshore Bulk Terminal Pte Ltd, Singapore
- IEA Clean Coal Centre - UK
- Xindia Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Carbofer General Trading SA - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Interocean Group of Companies - India
- Agrawal Coal Company - India
- AsiaOL BioFuels Corp., Philippines
- Maharashtra Electricity Regulatory Commission - India
- Dalmia Cement Bharat India
- Kumho Petrochemical, South Korea
- Tata Chemicals Ltd - India
- Vizag Seaport Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- Electricity Generating Authority of Thailand
- VISA Power Limited - India
- Savvy Resources Ltd - HongKong
- New Zealand Coal & Carbon
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