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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, 20 September 12
DRY BULK INCHES FORWARD AFTER WEEKS OF BELOW PAR PERFORMANCE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has started to revive from its ashed, as the past couple of days, traders have reported an increased activity from China, result ...
Wednesday, 19 September 12
CHURCHILL STRENGTHENS LITIGATION TEAM WITH APPOINTMENT OF NICHOLAS SMITH AS MANAGING DIRECTOR
COALspot.com - Churchill Mining PLC (AIM: CHL) has announced that, Mr Nicholas Smith has joined the board of the Company and has been appointed as t ...
Wednesday, 19 September 12
DRY BULK TERMINALS SINGAPORE
Press Release - Dry bulk terminals are used all around the world to handle large quantities of bulk materials, like minerals, grains, etc. In today& ...
Tuesday, 18 September 12
JORC CODE REVISION - EXPOSURE DRAFT RELEASED FOR COMMENT
COALspot.com - The Australasian Joint Ore Reserves Committee (JORC) has today released for public comment the exposure draft of the JORC Code (2012) ...
Monday, 17 September 12
YEAR TO DATE, BUMA PRODUCED 231.1 MILLION BCM OF OVERBURDEN
COALspot.com - PT. Delta Dunia Makmur Tbk has removed 31.5 million bcm (+6.0 percent YoY) overburden in August 2012 totaled 31.5 million bcm ( ...
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- LBH Netherlands Bv - Netherlands
- Global Coal Blending Company Limited - Australia
- Ind-Barath Power Infra Limited - India
- Toyota Tsusho Corporation, Japan
- Energy Development Corp, Philippines
- Energy Link Ltd, New Zealand
- Edison Trading Spa - Italy
- South Luzon Thermal Energy Corporation
- Georgia Ports Authority, United States
- Price Waterhouse Coopers - Russia
- Karbindo Abesyapradhi - Indoneisa
- Riau Bara Harum - Indonesia
- Electricity Authority, New Zealand
- Bhatia International Limited - India
- Uttam Galva Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Xindia Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indogreen Group - Indonesia
- Sical Logistics Limited - India
- Electricity Generating Authority of Thailand
- Ambuja Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Economic Council, Georgia
- Timah Investasi Mineral - Indoneisa
- Rio Tinto Coal - Australia
- Romanian Commodities Exchange
- Sree Jayajothi Cements Limited - India
- Coalindo Energy - Indonesia
- Commonwealth Bank - Australia
- Medco Energi Mining Internasional
- MS Steel International - UAE
- Chettinad Cement Corporation Ltd - India
- Anglo American - United Kingdom
- Central Electricity Authority - India
- Aboitiz Power Corporation - Philippines
- Baramulti Group, Indonesia
- Salva Resources Pvt Ltd - India
- GVK Power & Infra Limited - India
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- London Commodity Brokers - England
- Trasteel International SA, Italy
- Posco Energy - South Korea
- Kobexindo Tractors - Indoneisa
- Tata Chemicals Ltd - India
- Globalindo Alam Lestari - Indonesia
- Wood Mackenzie - Singapore
- Billiton Holdings Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Independent Power Producers Association of India
- European Bulk Services B.V. - Netherlands
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Maheswari Brothers Coal Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Coal and Oil Company - UAE
- Bukit Makmur.PT - Indonesia
- Parry Sugars Refinery, India
- Ministry of Finance - Indonesia
- Ministry of Mines - Canada
- Aditya Birla Group - India
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Indo Tambangraya Megah - Indonesia
- CIMB Investment Bank - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Renaissance Capital - South Africa
- Marubeni Corporation - India
- Meralco Power Generation, Philippines
- Mercator Lines Limited - India
- Oldendorff Carriers - Singapore
- Samtan Co., Ltd - South Korea
- Binh Thuan Hamico - Vietnam
- Indian Energy Exchange, India
- Port Waratah Coal Services - Australia
- Grasim Industreis Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Minerals Council of Australia
- Planning Commission, India
- Alfred C Toepfer International GmbH - Germany
- Dalmia Cement Bharat India
- Directorate Of Revenue Intelligence - India
- Straits Asia Resources Limited - Singapore
- Leighton Contractors Pty Ltd - Australia
- Goldman Sachs - Singapore
- Mintek Dendrill Indonesia
- Star Paper Mills Limited - India
- Coastal Gujarat Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Siam City Cement PLC, Thailand
- White Energy Company Limited
- Intertek Mineral Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Kumho Petrochemical, South Korea
- Antam Resourcindo - Indonesia
- Eastern Energy - Thailand
- Videocon Industries ltd - India
- Mercuria Energy - Indonesia
- Essar Steel Hazira Ltd - India
- Global Business Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Barasentosa Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Vizag Seaport Private Limited - India
- Lanco Infratech Ltd - India
- Borneo Indobara - Indonesia
- Latin American Coal - Colombia
- International Coal Ventures Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Bulk Trading Sa - Switzerland
- TNB Fuel Sdn Bhd - Malaysia
- Manunggal Multi Energi - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- Tamil Nadu electricity Board
- Indonesian Coal Mining Association
- Interocean Group of Companies - India
- Ceylon Electricity Board - Sri Lanka
- Iligan Light & Power Inc, Philippines
- Makarim & Taira - Indonesia
- Global Green Power PLC Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- ICICI Bank Limited - India
- TeaM Sual Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- Siam City Cement - Thailand
- Gujarat Sidhee Cement - India
- Bhoruka Overseas - Indonesia
- Indika Energy - Indonesia
- The Treasury - Australian Government
- SMG Consultants - Indonesia
- Parliament of New Zealand
- Petron Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PowerSource Philippines DevCo
- AsiaOL BioFuels Corp., Philippines
- Banpu Public Company Limited - Thailand
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Meenaskhi Energy Private Limited - India
- Formosa Plastics Group - Taiwan
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Deloitte Consulting - India
- Mjunction Services Limited - India
- Singapore Mercantile Exchange
- Jindal Steel & Power Ltd - India
- Thiess Contractors Indonesia
- Carbofer General Trading SA - India
- Bangladesh Power Developement Board
- Australian Commodity Traders Exchange
- Power Finance Corporation Ltd., India
- Madhucon Powers Ltd - India
- Australian Coal Association
- Pendopo Energi Batubara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- San Jose City I Power Corp, Philippines
- Sojitz Corporation - Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GMR Energy Limited - India
- Miang Besar Coal Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- New Zealand Coal & Carbon
- Vijayanagar Sugar Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- McConnell Dowell - Australia
- Maharashtra Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- VISA Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Heidelberg Cement - Germany
- Simpson Spence & Young - Indonesia
- Wilmar Investment Holdings
- Eastern Coal Council - USA
- Agrawal Coal Company - India
- The University of Queensland
- CNBM International Corporation - China
- Sarangani Energy Corporation, Philippines
- Ministry of Transport, Egypt
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- Kaltim Prima Coal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Orica Australia Pty. Ltd.
- Kartika Selabumi Mining - Indonesia
- Kepco SPC Power Corporation, Philippines
- Bhushan Steel Limited - India
- Sinarmas Energy and Mining - Indonesia
- Attock Cement Pakistan Limited
- Chamber of Mines of South Africa
- Bharathi Cement Corporation - India
- SMC Global Power, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Thai Mozambique Logistica
- Semirara Mining Corp, Philippines
- Standard Chartered Bank - UAE
- ASAPP Information Group - India
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Asmin Koalindo Tuhup - Indonesia
- Jaiprakash Power Ventures ltd
- Altura Mining Limited, Indonesia
- Malabar Cements Ltd - India
- Sakthi Sugars Limited - India
- Indian Oil Corporation Limited
- Africa Commodities Group - South Africa
- Bukit Baiduri Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
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