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Saturday, 10 July 21
OVERESTIMATED LCOES OF COAL-FIRED POWER PLANTS CREATE A FINANCIAL BUBBLE - IEEFA
 Massive stranded asset risk detrimentally affects the financial and power distribution
India’s future coal-fired power project pipeline carries a massive stranded asset risk due to the collapse in the average utilisation rate of its coal-fired power fleet leading to an underestimation of financial risk for new projects, finds a new report from the Institute for Energy Economics and Financial Analysis (IEEFA).
There are currently 33 gigawatts (GW) of coal-fired power plants under construction and another 29GW of proposed projects under various stages of regulatory approval in India.
Author of the report, energy finance analyst Kashish Shah says the LCOE (levelised cost of energy) is the required tariff at which the net present value of the investment is zero.
“In other words, LCOE is the minimum required average tariff for a power asset to reach a breakeven return at the end of its life. Anything less than that suggests the asset is unviable.”
Shah found that the average utilisation rate of India’s coal-fired fleet has collapsed to a financially unsustainable low of 53% in financial year (FY) 2020/21 from a high of 78% a decade ago in FY2011/12.
For most coal plants in India, the LCOE is calculated with an assumption of utilisation factor of 85-90% throughout the life of the project. However, the LCOE turns out to be 64% higher with India’s average capacity utilisation factor sitting at ~55% for the last few years.
“The aspiration for further builds of coal capacity stems from the notion that coal is still ‘cheap’,” says Shah. “However, with tariffs now below Rs2/kilowatt hour (kWh) (US$27/MWh), solar power is cheaper than even the variable cost of coal-fired power and is ready to absorb incremental daytime demand.”
IEEFA’s report highlights that utilisation factors of coal-fired power plants have declined not just in India, but across major electricity markets including China, the United Kingdom (UK) and the United States (U.S.).
“With zero fuel costs, the marginal cost of generation for renewables is practically zero,” says Shah. “On the other hand, with increasing inflation in Indian domestic coal prices and railway transportation costs for coal, the gap between cost competitiveness of renewables versus coal is widening.
“This raises a serious concern about the viability of coal-fired power plants.
“Debt servicing for underutilised coal-fired power assets becomes extremely difficult and creates a liquidity crunch in the whole value chain. The financial stress then spills over to the power distribution sector as well as affecting India’s financial lending institutions. This further inhibits growth in other important segments of the power industry such as renewables and transmission infrastructure, which are extremely critical for India’s electricity sector transition.”
The report concludes that the financial viability of India’s proposed and under construction coal-fired power projects should be re-evaluated based on the right estimation of utilisation factors including LCOE and capacity factor to avoid further bloating of India’s non-performing assets.
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Friday, 04 June 21
NEW COAL-FIRED POWER PLANTS IN INDIA WILL BE ECONOMICALLY UNVIABLE - IEEFA
Coal capacity additions face major stranded asset risk
Much of India’s 33 gigawatts (GW) of coal-fired power capacity currently under co ...
Thursday, 03 June 21
JUNE HBA IS HITTING ABOVE $100 AND SETTLED AT ITS HIGHEST SINCE OCTOBER 2020
COALspot.com: The Indonesia coal price reference for June 2021 settles at US$ 100.33 per ton FOB vessel.
The Indonesia coal pr ...
Wednesday, 02 June 21
INDONESIA RV WAS DOWN TO LOW/MID $20,000S DAY FOR PANAMAX/KAMSARMAX WITH DELIVERY S CHINA - BANCHERO COSTA
Panamax
A softening week in the Pacific basin with rates under a downward pressure mainly caused by the oversupply of tonnage in the area, said ...
Wednesday, 02 June 21
EUROPEAN UNION'S IRON ORE IMPORTS - BANCHERO COSTA
The European Union (27) is currently the fourth largest importer of iron ore in the world, after China, Japan, and South Korea.
Euro ...
Tuesday, 01 June 21
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.02 PCT - XINHUA
China Taiyuan coal transaction price index stood at 160.06 points Monday, down 0.02 percent week on week.
The index, released by Chi ...
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- Kalimantan Lumbung Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Planning Commission, India
- Kumho Petrochemical, South Korea
- Ministry of Transport, Egypt
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- SMC Global Power, Philippines
- Aditya Birla Group - India
- Trasteel International SA, Italy
- Toyota Tsusho Corporation, Japan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
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- Offshore Bulk Terminal Pte Ltd, Singapore
- Africa Commodities Group - South Africa
- AsiaOL BioFuels Corp., Philippines
- Maheswari Brothers Coal Limited - India
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- Australian Coal Association
- Lanco Infratech Ltd - India
- Bharathi Cement Corporation - India
- Bukit Baiduri Energy - Indonesia
- Anglo American - United Kingdom
- Star Paper Mills Limited - India
- Gujarat Electricity Regulatory Commission - India
- Larsen & Toubro Limited - India
- Latin American Coal - Colombia
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- Metalloyd Limited - United Kingdom
- Borneo Indobara - Indonesia
- PNOC Exploration Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
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- Globalindo Alam Lestari - Indonesia
- Baramulti Group, Indonesia
- Georgia Ports Authority, United States
- Rio Tinto Coal - Australia
- Miang Besar Coal Terminal - Indonesia
- Parry Sugars Refinery, India
- Meralco Power Generation, Philippines
- Videocon Industries ltd - India
- Intertek Mineral Services - Indonesia
- Indian Oil Corporation Limited
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- CNBM International Corporation - China
- Posco Energy - South Korea
- Ministry of Mines - Canada
- OPG Power Generation Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- ICICI Bank Limited - India
- Ambuja Cements Ltd - India
- GAC Shipping (India) Pvt Ltd
- Gujarat Mineral Development Corp Ltd - India
- SN Aboitiz Power Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Kaltim Prima Coal - Indonesia
- Central Electricity Authority - India
- Leighton Contractors Pty Ltd - Australia
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- TeaM Sual Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Independent Power Producers Association of India
- Bhoruka Overseas - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Agrawal Coal Company - India
- Bukit Makmur.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- The State Trading Corporation of India Ltd
- Sinarmas Energy and Mining - Indonesia
- Bhatia International Limited - India
- Makarim & Taira - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Energy Development Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Interocean Group of Companies - India
- Kapuas Tunggal Persada - Indonesia
- IEA Clean Coal Centre - UK
- Indogreen Group - Indonesia
- Siam City Cement PLC, Thailand
- Vizag Seaport Private Limited - India
- Electricity Authority, New Zealand
- Coalindo Energy - Indonesia
- London Commodity Brokers - England
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- Indian Energy Exchange, India
- Bangladesh Power Developement Board
- Heidelberg Cement - Germany
- Orica Australia Pty. Ltd.
- Vedanta Resources Plc - India
- GVK Power & Infra Limited - India
- Eastern Energy - Thailand
- Bayan Resources Tbk. - Indonesia
- Chettinad Cement Corporation Ltd - India
- Global Green Power PLC Corporation, Philippines
- Indika Energy - Indonesia
- The University of Queensland
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- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- Therma Luzon, Inc, Philippines
- CIMB Investment Bank - Malaysia
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- Coastal Gujarat Power Limited - India
- Kobexindo Tractors - Indoneisa
- Renaissance Capital - South Africa
- Indonesian Coal Mining Association
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- Global Business Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Banpu Public Company Limited - Thailand
- Salva Resources Pvt Ltd - India
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- Jaiprakash Power Ventures ltd
- Sakthi Sugars Limited - India
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- Bahari Cakrawala Sebuku - Indonesia
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- Standard Chartered Bank - UAE
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- Essar Steel Hazira Ltd - India
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- Antam Resourcindo - Indonesia
- Parliament of New Zealand
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- Ceylon Electricity Board - Sri Lanka
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- South Luzon Thermal Energy Corporation
- Price Waterhouse Coopers - Russia
- Tamil Nadu electricity Board
- Xindia Steels Limited - India
- Dalmia Cement Bharat India
- Jorong Barutama Greston.PT - Indonesia
- Economic Council, Georgia
- Bulk Trading Sa - Switzerland
- GN Power Mariveles Coal Plant, Philippines
- Sindya Power Generating Company Private Ltd
- Ministry of Finance - Indonesia
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
- India Bulls Power Limited - India
- Altura Mining Limited, Indonesia
- Romanian Commodities Exchange
- Simpson Spence & Young - Indonesia
- Power Finance Corporation Ltd., India
- Timah Investasi Mineral - Indoneisa
- Singapore Mercantile Exchange
- Australian Commodity Traders Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Edison Trading Spa - Italy
- Chamber of Mines of South Africa
- Alfred C Toepfer International GmbH - Germany
- Deloitte Consulting - India
- Thiess Contractors Indonesia
- Wilmar Investment Holdings
- Medco Energi Mining Internasional
- Merrill Lynch Commodities Europe
- Maharashtra Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Orica Mining Services - Indonesia
- European Bulk Services B.V. - Netherlands
- San Jose City I Power Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Goldman Sachs - Singapore
- Carbofer General Trading SA - India
- VISA Power Limited - India
- The Treasury - Australian Government
- Energy Link Ltd, New Zealand
- Mercator Lines Limited - India
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- White Energy Company Limited
- GMR Energy Limited - India
- Mercuria Energy - Indonesia
- Coal and Oil Company - UAE
- Minerals Council of Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Commonwealth Bank - Australia
- Wood Mackenzie - Singapore
- PowerSource Philippines DevCo
- Sojitz Corporation - Japan
- Asmin Koalindo Tuhup - Indonesia
- Sarangani Energy Corporation, Philippines
- Madhucon Powers Ltd - India
- Electricity Generating Authority of Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- New Zealand Coal & Carbon
- McConnell Dowell - Australia
- Thai Mozambique Logistica
- Grasim Industreis Ltd - India
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- Karaikal Port Pvt Ltd - India
- PTC India Limited - India
- Uttam Galva Steels Limited - India
- Petron Corporation, Philippines
- Riau Bara Harum - Indonesia
- Savvy Resources Ltd - HongKong
- Directorate Of Revenue Intelligence - India
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- Port Waratah Coal Services - Australia
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