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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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Wednesday, 25 April 12
CHINA IMPORTS 9.76 MMT AND INDIA IMPORTS 7.03 MMT OF INDONESIAN COAL LAST MONTH
COALspot.com: Indonesia, the world largest coal exporter, shipped 30.64* million tons of coal in March 2012, compared to 27.12* million tons i ...
Monday, 23 April 12
ALTURA ENTERS INTO AGREEMENT TO ACQUIRE 2 COAL PROJECTS IN SOUTH KALIMANTAN
COALspot.com - Altura Mining Limited (ASX: AJM) has announced that it has entered into an agreement to acquire a further two (2) Mining Permits (IUP ...
Sunday, 22 April 12
THE FREIGHT MARKET EXPECTED TO REMAIN FIRM NEXT WEEK - VISTAAR
COALspot.com - The BDI has broken the psychological barrier of 1000 points and closed at 1067 points.
The cape index was slightly down by 2.48 pc ...
Saturday, 21 April 12
INDONESIAN SUB-BITUMINOUS COAL SWAPS DROP 2.61 PERCENT THIS WEEK
COALspot.com - Indonesian sub-bituminous coal swaps fell for a fifth day, according to DSP of SGX AsiaClear OTC Coal Swaps.
CFR South China Coal ...
Friday, 20 April 12
PANAMAXES LEAD DRY BULK MARKET TO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A rebound of demand for smaller dry bulk carriers has led the industry’s benchmark, the BDI (Baltic Dry Index) above the 1,000-point mark for ...
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- Aboitiz Power Corporation - Philippines
- Sical Logistics Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Mineral Development Corp Ltd - India
- Sojitz Corporation - Japan
- Power Finance Corporation Ltd., India
- Orica Australia Pty. Ltd.
- Independent Power Producers Association of India
- Bukit Asam (Persero) Tbk - Indonesia
- Tamil Nadu electricity Board
- Barasentosa Lestari - Indonesia
- Goldman Sachs - Singapore
- Deloitte Consulting - India
- Kartika Selabumi Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Australian Coal Association
- Antam Resourcindo - Indonesia
- PowerSource Philippines DevCo
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- The University of Queensland
- Vedanta Resources Plc - India
- Salva Resources Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Port Waratah Coal Services - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Siam City Cement - Thailand
- European Bulk Services B.V. - Netherlands
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Star Paper Mills Limited - India
- The Treasury - Australian Government
- McConnell Dowell - Australia
- Interocean Group of Companies - India
- Semirara Mining and Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Straits Asia Resources Limited - Singapore
- Indian Energy Exchange, India
- Orica Mining Services - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Altura Mining Limited, Indonesia
- Commonwealth Bank - Australia
- Attock Cement Pakistan Limited
- South Luzon Thermal Energy Corporation
- Eastern Coal Council - USA
- Larsen & Toubro Limited - India
- Aditya Birla Group - India
- Coastal Gujarat Power Limited - India
- Oldendorff Carriers - Singapore
- Sarangani Energy Corporation, Philippines
- Posco Energy - South Korea
- Mjunction Services Limited - India
- Anglo American - United Kingdom
- Bangladesh Power Developement Board
- Metalloyd Limited - United Kingdom
- Wood Mackenzie - Singapore
- Intertek Mineral Services - Indonesia
- Cement Manufacturers Association - India
- Grasim Industreis Ltd - India
- PTC India Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Oil Corporation Limited
- Thai Mozambique Logistica
- Karbindo Abesyapradhi - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Singapore Mercantile Exchange
- Coalindo Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- Dalmia Cement Bharat India
- Jorong Barutama Greston.PT - Indonesia
- Binh Thuan Hamico - Vietnam
- Price Waterhouse Coopers - Russia
- Chettinad Cement Corporation Ltd - India
- SMC Global Power, Philippines
- Kideco Jaya Agung - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Georgia Ports Authority, United States
- PetroVietnam Power Coal Import and Supply Company
- ASAPP Information Group - India
- Coal and Oil Company - UAE
- Semirara Mining Corp, Philippines
- Videocon Industries ltd - India
- Indogreen Group - Indonesia
- Wilmar Investment Holdings
- Uttam Galva Steels Limited - India
- Agrawal Coal Company - India
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Vizag Seaport Private Limited - India
- Ceylon Electricity Board - Sri Lanka
- India Bulls Power Limited - India
- Gujarat Sidhee Cement - India
- Timah Investasi Mineral - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Karaikal Port Pvt Ltd - India
- SMG Consultants - Indonesia
- Xindia Steels Limited - India
- MS Steel International - UAE
- GAC Shipping (India) Pvt Ltd
- Marubeni Corporation - India
- Ambuja Cements Ltd - India
- Jindal Steel & Power Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Thiess Contractors Indonesia
- IEA Clean Coal Centre - UK
- Kohat Cement Company Ltd. - Pakistan
- Renaissance Capital - South Africa
- San Jose City I Power Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Central Java Power - Indonesia
- GVK Power & Infra Limited - India
- New Zealand Coal & Carbon
- Romanian Commodities Exchange
- VISA Power Limited - India
- ICICI Bank Limited - India
- CIMB Investment Bank - Malaysia
- Directorate Of Revenue Intelligence - India
- Iligan Light & Power Inc, Philippines
- Ministry of Finance - Indonesia
- Carbofer General Trading SA - India
- Bharathi Cement Corporation - India
- Electricity Authority, New Zealand
- Economic Council, Georgia
- Bhushan Steel Limited - India
- Kobexindo Tractors - Indoneisa
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Merrill Lynch Commodities Europe
- Chamber of Mines of South Africa
- Kumho Petrochemical, South Korea
- Gujarat Electricity Regulatory Commission - India
- Savvy Resources Ltd - HongKong
- Toyota Tsusho Corporation, Japan
- Energy Development Corp, Philippines
- Holcim Trading Pte Ltd - Singapore
- Energy Link Ltd, New Zealand
- Planning Commission, India
- Bukit Makmur.PT - Indonesia
- Riau Bara Harum - Indonesia
- Krishnapatnam Port Company Ltd. - India
- International Coal Ventures Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Malabar Cements Ltd - India
- Madhucon Powers Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sinarmas Energy and Mining - Indonesia
- Banpu Public Company Limited - Thailand
- Sree Jayajothi Cements Limited - India
- Australian Commodity Traders Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Global Green Power PLC Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Makarim & Taira - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Rio Tinto Coal - Australia
- Simpson Spence & Young - Indonesia
- Therma Luzon, Inc, Philippines
- Ministry of Transport, Egypt
- Maharashtra Electricity Regulatory Commission - India
- Global Business Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Formosa Plastics Group - Taiwan
- Bahari Cakrawala Sebuku - Indonesia
- London Commodity Brokers - England
- Bulk Trading Sa - Switzerland
- Siam City Cement PLC, Thailand
- PNOC Exploration Corporation - Philippines
- Latin American Coal - Colombia
- Rashtriya Ispat Nigam Limited - India
- Parliament of New Zealand
- Tata Chemicals Ltd - India
- Minerals Council of Australia
- Meralco Power Generation, Philippines
- Ministry of Mines - Canada
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Sakthi Sugars Limited - India
- Kepco SPC Power Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Trasteel International SA, Italy
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Miang Besar Coal Terminal - Indonesia
- Standard Chartered Bank - UAE
- Ind-Barath Power Infra Limited - India
- Indonesian Coal Mining Association
- Central Electricity Authority - India
- Kalimantan Lumbung Energi - Indonesia
- White Energy Company Limited
- CNBM International Corporation - China
- Electricity Generating Authority of Thailand
- Borneo Indobara - Indonesia
- Maheswari Brothers Coal Limited - India
- Eastern Energy - Thailand
- Pendopo Energi Batubara - Indonesia
- OPG Power Generation Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Mintek Dendrill Indonesia
- Parry Sugars Refinery, India
- IHS Mccloskey Coal Group - USA
- SN Aboitiz Power Inc, Philippines
- Kaltim Prima Coal - Indonesia
- GMR Energy Limited - India
- LBH Netherlands Bv - Netherlands
- Edison Trading Spa - Italy
- Jaiprakash Power Ventures ltd
- Lanco Infratech Ltd - India
- Mercuria Energy - Indonesia
- TeaM Sual Corporation - Philippines
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