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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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Thursday, 22 March 12
DRY BULK MARKET KEEPS SURGING, CAPESIZES FALLING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what seems to be an establishing pattern, the dry bulk market has kept its upward momentum, edging closer to the 900 point-mark, but the larger s ...
Wednesday, 21 March 12
BUMA HAS PRODUCED 2.3 MILLION TONS OF COAL IN FEBRUARY 2012
COALspot.com - PT. Delta Dunia Makmur's overburden removal in February 2012 has reached totaled 23.8 million bcm (+2.4% YoY) while coal production ...
Tuesday, 20 March 12
SMALLER DRY BULK VESSELS STILL LEADING DRY BULK MARKET TO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has been growing during the past couple of weeks, but contrary to the usual practice, it’s not the larger Capesizes which ...
Monday, 19 March 12
WEEKLY DRY MARKET OVERVIEW: SMALLER VESSELS LEAD RATES HIGHER - MARIA BERTZELETOU, HELLENIC SHIPPING
The upward trend of the Baltic Dry Index persists strong from the end of February, spurred from the supramax market that offsets the weakness in the ...
Sunday, 18 March 12
BUKIT ASAM'S NET PROFIT IN 2011 ROSE 54% TO US$ 339.56 MILLION
COALspot.com - Company revenue for the period January - December 2011 amounting to Rp 10.6 trillion (approximately US$ 1,164,835,164.84) recorded an ...
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- Deloitte Consulting - India
- The Treasury - Australian Government
- Bukit Asam (Persero) Tbk - Indonesia
- Bangladesh Power Developement Board
- Pipit Mutiara Jaya. PT, Indonesia
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Ind-Barath Power Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- MS Steel International - UAE
- Coalindo Energy - Indonesia
- Makarim & Taira - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Karbindo Abesyapradhi - Indoneisa
- Kartika Selabumi Mining - Indonesia
- The University of Queensland
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- AsiaOL BioFuels Corp., Philippines
- Indika Energy - Indonesia
- Economic Council, Georgia
- Aboitiz Power Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Pendopo Energi Batubara - Indonesia
- Australian Coal Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Binh Thuan Hamico - Vietnam
- Renaissance Capital - South Africa
- Star Paper Mills Limited - India
- Independent Power Producers Association of India
- Essar Steel Hazira Ltd - India
- Kaltim Prima Coal - Indonesia
- Formosa Plastics Group - Taiwan
- Posco Energy - South Korea
- Jindal Steel & Power Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Kobexindo Tractors - Indoneisa
- Siam City Cement - Thailand
- Romanian Commodities Exchange
- ASAPP Information Group - India
- Attock Cement Pakistan Limited
- Simpson Spence & Young - Indonesia
- PNOC Exploration Corporation - Philippines
- Wood Mackenzie - Singapore
- Krishnapatnam Port Company Ltd. - India
- Savvy Resources Ltd - HongKong
- Kepco SPC Power Corporation, Philippines
- Minerals Council of Australia
- Petron Corporation, Philippines
- Lanco Infratech Ltd - India
- Dalmia Cement Bharat India
- Xindia Steels Limited - India
- Mjunction Services Limited - India
- Coastal Gujarat Power Limited - India
- Iligan Light & Power Inc, Philippines
- London Commodity Brokers - England
- Merrill Lynch Commodities Europe
- Australian Commodity Traders Exchange
- Sree Jayajothi Cements Limited - India
- Jaiprakash Power Ventures ltd
- SMC Global Power, Philippines
- VISA Power Limited - India
- McConnell Dowell - Australia
- GAC Shipping (India) Pvt Ltd
- Global Business Power Corporation, Philippines
- Indogreen Group - Indonesia
- Bulk Trading Sa - Switzerland
- Cement Manufacturers Association - India
- Orica Australia Pty. Ltd.
- Kumho Petrochemical, South Korea
- Aditya Birla Group - India
- Trasteel International SA, Italy
- Sical Logistics Limited - India
- SN Aboitiz Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Agrawal Coal Company - India
- Energy Development Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
- Thai Mozambique Logistica
- Altura Mining Limited, Indonesia
- Indian Oil Corporation Limited
- Power Finance Corporation Ltd., India
- Marubeni Corporation - India
- Miang Besar Coal Terminal - Indonesia
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- The State Trading Corporation of India Ltd
- Maharashtra Electricity Regulatory Commission - India
- Banpu Public Company Limited - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Karaikal Port Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- New Zealand Coal & Carbon
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- CIMB Investment Bank - Malaysia
- Ministry of Finance - Indonesia
- Price Waterhouse Coopers - Russia
- Alfred C Toepfer International GmbH - Germany
- Bank of Tokyo Mitsubishi UFJ Ltd
- European Bulk Services B.V. - Netherlands
- Bharathi Cement Corporation - India
- Global Green Power PLC Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Sojitz Corporation - Japan
- PetroVietnam Power Coal Import and Supply Company
- Bhatia International Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bayan Resources Tbk. - Indonesia
- Salva Resources Pvt Ltd - India
- Standard Chartered Bank - UAE
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Indian Energy Exchange, India
- Grasim Industreis Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Barasentosa Lestari - Indonesia
- PTC India Limited - India
- Antam Resourcindo - Indonesia
- Timah Investasi Mineral - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- Tamil Nadu electricity Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- Planning Commission, India
- CNBM International Corporation - China
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- Bukit Makmur.PT - Indonesia
- PowerSource Philippines DevCo
- Latin American Coal - Colombia
- Parliament of New Zealand
- Port Waratah Coal Services - Australia
- Carbofer General Trading SA - India
- GMR Energy Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Coal and Oil Company - UAE
- Eastern Coal Council - USA
- Indonesian Coal Mining Association
- Parry Sugars Refinery, India
- Energy Link Ltd, New Zealand
- Sindya Power Generating Company Private Ltd
- Commonwealth Bank - Australia
- Intertek Mineral Services - Indonesia
- Borneo Indobara - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Eastern Energy - Thailand
- Mercuria Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Rio Tinto Coal - Australia
- Africa Commodities Group - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Vijayanagar Sugar Pvt Ltd - India
- Mercator Lines Limited - India
- Ministry of Mines - Canada
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- Electricity Authority, New Zealand
- TeaM Sual Corporation - Philippines
- Vedanta Resources Plc - India
- Chettinad Cement Corporation Ltd - India
- Ministry of Transport, Egypt
- Mintek Dendrill Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Semirara Mining Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Siam City Cement PLC, Thailand
- Baramulti Group, Indonesia
- OPG Power Generation Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Madhucon Powers Ltd - India
- Wilmar Investment Holdings
- LBH Netherlands Bv - Netherlands
- Meralco Power Generation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Ambuja Cements Ltd - India
- Global Coal Blending Company Limited - Australia
- Oldendorff Carriers - Singapore
- Heidelberg Cement - Germany
- Manunggal Multi Energi - Indonesia
- Chamber of Mines of South Africa
- India Bulls Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Georgia Ports Authority, United States
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Tata Chemicals Ltd - India
- Metalloyd Limited - United Kingdom
- Videocon Industries ltd - India
- Meenaskhi Energy Private Limited - India
- Larsen & Toubro Limited - India
- Uttam Galva Steels Limited - India
- International Coal Ventures Pvt Ltd - India
- Interocean Group of Companies - India
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Orica Mining Services - Indonesia
- Central Electricity Authority - India
- Holcim Trading Pte Ltd - Singapore
- Thiess Contractors Indonesia
- Sarangani Energy Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Gujarat Sidhee Cement - India
- Bhushan Steel Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- White Energy Company Limited
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