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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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Sunday, 23 September 12
AN ANOTHER UNSTABLE WEEK FOR INDONESIAN COAL SWAPS
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for November 2012 delivery lost 1.10 percent and 0.916 percent WOW and DOD respectively ...
Sunday, 23 September 12
INDIA IMPORTED 11.40 PERCENT MORE INDONESIAN COAL IN AUGUST
COALspot.com: Indonesia, the world largest multi grade coal exporter, shipped 26,451,565* tons of coal in August 2012, compared to 27.88* mill ...
Saturday, 22 September 12
SOFT BUNKER PRICES KEEP INDONESIA TO INDIA FREIGHTS STABLE - VISTAAR
COALspot.com - The freight market overall remained buoyant with all indices up except for Panamax index. The main effect seems to be increased shipm ...
Friday, 21 September 12
SHIP BREAKING ACTIVITY REACHES NEW RECORDS, AS ALREADY 2012 LEVELS HAVE SURPASSED THE WHOLE OF 2011 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The vast oversupply of vessels, most notably in the dry bulk shipping sector, has forced ship owners to intensify their efforts towards recycling th ...
Thursday, 20 September 12
SUPRAMAX : INDO-INDIA ROUNDS WERE AROUND USD 12K - FEARNLEYS
Handy
Not a bad week for Supramax tonnage, if we compare Supramax developments to the bigger size tonnage. The rates have basically remained unchan ...
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- Kohat Cement Company Ltd. - Pakistan
- Wilmar Investment Holdings
- Siam City Cement - Thailand
- Salva Resources Pvt Ltd - India
- Sojitz Corporation - Japan
- Karaikal Port Pvt Ltd - India
- Borneo Indobara - Indonesia
- Intertek Mineral Services - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Economic Council, Georgia
- Meralco Power Generation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Globalindo Alam Lestari - Indonesia
- Energy Development Corp, Philippines
- Bhushan Steel Limited - India
- Indonesian Coal Mining Association
- Central Java Power - Indonesia
- Pendopo Energi Batubara - Indonesia
- SN Aboitiz Power Inc, Philippines
- Uttam Galva Steels Limited - India
- Metalloyd Limited - United Kingdom
- CIMB Investment Bank - Malaysia
- Formosa Plastics Group - Taiwan
- Ministry of Transport, Egypt
- The State Trading Corporation of India Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cement Manufacturers Association - India
- CNBM International Corporation - China
- Bharathi Cement Corporation - India
- Meenaskhi Energy Private Limited - India
- Indogreen Group - Indonesia
- Africa Commodities Group - South Africa
- Wood Mackenzie - Singapore
- Energy Link Ltd, New Zealand
- LBH Netherlands Bv - Netherlands
- Thiess Contractors Indonesia
- Larsen & Toubro Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Anglo American - United Kingdom
- Bukit Baiduri Energy - Indonesia
- Malabar Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jorong Barutama Greston.PT - Indonesia
- Trasteel International SA, Italy
- Ministry of Mines - Canada
- Rashtriya Ispat Nigam Limited - India
- VISA Power Limited - India
- Indian Energy Exchange, India
- Sarangani Energy Corporation, Philippines
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- Aditya Birla Group - India
- Cigading International Bulk Terminal - Indonesia
- MS Steel International - UAE
- Savvy Resources Ltd - HongKong
- Aboitiz Power Corporation - Philippines
- PNOC Exploration Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Directorate General of MIneral and Coal - Indonesia
- Xindia Steels Limited - India
- Independent Power Producers Association of India
- Samtan Co., Ltd - South Korea
- Jindal Steel & Power Ltd - India
- Iligan Light & Power Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Semirara Mining Corp, Philippines
- Romanian Commodities Exchange
- Vizag Seaport Private Limited - India
- Electricity Generating Authority of Thailand
- Semirara Mining and Power Corporation, Philippines
- Makarim & Taira - Indonesia
- Kepco SPC Power Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Oldendorff Carriers - Singapore
- GVK Power & Infra Limited - India
- Miang Besar Coal Terminal - Indonesia
- Central Electricity Authority - India
- Indian Oil Corporation Limited
- South Luzon Thermal Energy Corporation
- Price Waterhouse Coopers - Russia
- Attock Cement Pakistan Limited
- Parry Sugars Refinery, India
- Singapore Mercantile Exchange
- Orica Australia Pty. Ltd.
- Ambuja Cements Ltd - India
- New Zealand Coal & Carbon
- GN Power Mariveles Coal Plant, Philippines
- Port Waratah Coal Services - Australia
- Indika Energy - Indonesia
- The University of Queensland
- Directorate Of Revenue Intelligence - India
- Star Paper Mills Limited - India
- Australian Commodity Traders Exchange
- Bhatia International Limited - India
- Madhucon Powers Ltd - India
- Interocean Group of Companies - India
- Neyveli Lignite Corporation Ltd, - India
- Timah Investasi Mineral - Indoneisa
- Mintek Dendrill Indonesia
- McConnell Dowell - Australia
- Standard Chartered Bank - UAE
- Latin American Coal - Colombia
- OPG Power Generation Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kumho Petrochemical, South Korea
- Ind-Barath Power Infra Limited - India
- Kapuas Tunggal Persada - Indonesia
- Kaltim Prima Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- GMR Energy Limited - India
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Grasim Industreis Ltd - India
- Antam Resourcindo - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ceylon Electricity Board - Sri Lanka
- European Bulk Services B.V. - Netherlands
- Goldman Sachs - Singapore
- GAC Shipping (India) Pvt Ltd
- Minerals Council of Australia
- Coal and Oil Company - UAE
- Kobexindo Tractors - Indoneisa
- Tamil Nadu electricity Board
- Gujarat Sidhee Cement - India
- IHS Mccloskey Coal Group - USA
- Baramulti Group, Indonesia
- Kideco Jaya Agung - Indonesia
- Georgia Ports Authority, United States
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- Edison Trading Spa - Italy
- Heidelberg Cement - Germany
- Kartika Selabumi Mining - Indonesia
- Mercator Lines Limited - India
- Altura Mining Limited, Indonesia
- Bulk Trading Sa - Switzerland
- Commonwealth Bank - Australia
- Australian Coal Association
- Posco Energy - South Korea
- PTC India Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Riau Bara Harum - Indonesia
- Sakthi Sugars Limited - India
- Planning Commission, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sindya Power Generating Company Private Ltd
- SMC Global Power, Philippines
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- Bangladesh Power Developement Board
- Krishnapatnam Port Company Ltd. - India
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Bukit Makmur.PT - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- India Bulls Power Limited - India
- Essar Steel Hazira Ltd - India
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Marubeni Corporation - India
- TeaM Sual Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Banpu Public Company Limited - Thailand
- Eastern Coal Council - USA
- Eastern Energy - Thailand
- Parliament of New Zealand
- Carbofer General Trading SA - India
- San Jose City I Power Corp, Philippines
- Thai Mozambique Logistica
- Sree Jayajothi Cements Limited - India
- Vedanta Resources Plc - India
- Maheswari Brothers Coal Limited - India
- Ministry of Finance - Indonesia
- Renaissance Capital - South Africa
- Barasentosa Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Global Coal Blending Company Limited - Australia
- Merrill Lynch Commodities Europe
- Bayan Resources Tbk. - Indonesia
- Global Business Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Lanco Infratech Ltd - India
- Alfred C Toepfer International GmbH - Germany
- IEA Clean Coal Centre - UK
- Bhoruka Overseas - Indonesia
- Rio Tinto Coal - Australia
- Electricity Authority, New Zealand
- Orica Mining Services - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Tata Chemicals Ltd - India
- Mjunction Services Limited - India
- Sinarmas Energy and Mining - Indonesia
- Videocon Industries ltd - India
- The Treasury - Australian Government
- London Commodity Brokers - England
- Coalindo Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Mercuria Energy - Indonesia
- ICICI Bank Limited - India
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- ASAPP Information Group - India
- Agrawal Coal Company - India
- TNB Fuel Sdn Bhd - Malaysia
- Siam City Cement PLC, Thailand
- Dalmia Cement Bharat India
- Petron Corporation, Philippines
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