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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, 29 August 12
COLOMBIA'S MINING BOOM: PART ONE - JOSEPH KIRSCHKE
COALspot.com - Colombia stands before one of the potentially largest, most diversified mining booms in the world. Untold reserves of gold, coal, cop ...
Wednesday, 29 August 12
SECOND HAND VESSELS IN HIGH DEMAND DESPITE SUMMER SEASON - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Despite the slow summer season, ship owners appear to be rather keen in acquiring some modern second hand tonnage at "knock-down" prices. ...
Monday, 27 August 12
BUMI BOOKS $322.1 MILLION NET LOSS IN 1H 2012 IN SPITE OF 8.6 PERCENT INCREASE IN SALES REVENUE
PT Bumi Resources Tbk, the single largest coal producer and exporter in Indonesia announces its first half financial report for the ...
Monday, 27 August 12
OVER 200 FOREIGN COMPANIES AND ENERGY MAJORS EXPECTED AT 2ND MOGP SUMMIT IN YANGON
Singapore based CMT and Machinery & Solutions Co. Ltd (M&S) announce that the 2nd MOGP Summit will be held on 3-6 September at the Sedona ho ...
Sunday, 26 August 12
SOUTH AFRICAN COAL OVERVIEW
South Africa's indigenous energy resource base is dominated by coal.
Internationally, coal is the most widely used primary fuel, accounting for ...
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- Eastern Energy - Thailand
- MS Steel International - UAE
- PowerSource Philippines DevCo
- Petron Corporation, Philippines
- India Bulls Power Limited - India
- Price Waterhouse Coopers - Russia
- Commonwealth Bank - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Mines - Canada
- European Bulk Services B.V. - Netherlands
- Wilmar Investment Holdings
- Sinarmas Energy and Mining - Indonesia
- Videocon Industries ltd - India
- Bhoruka Overseas - Indonesia
- Ministry of Finance - Indonesia
- TeaM Sual Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Australian Commodity Traders Exchange
- Kideco Jaya Agung - Indonesia
- Wood Mackenzie - Singapore
- Savvy Resources Ltd - HongKong
- Sical Logistics Limited - India
- Singapore Mercantile Exchange
- Eastern Coal Council - USA
- Maheswari Brothers Coal Limited - India
- Intertek Mineral Services - Indonesia
- Coalindo Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- Karbindo Abesyapradhi - Indoneisa
- Ambuja Cements Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Essar Steel Hazira Ltd - India
- Borneo Indobara - Indonesia
- Barasentosa Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Star Paper Mills Limited - India
- Bukit Makmur.PT - Indonesia
- PTC India Limited - India
- Mintek Dendrill Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Planning Commission, India
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Renaissance Capital - South Africa
- GAC Shipping (India) Pvt Ltd
- Sree Jayajothi Cements Limited - India
- Xindia Steels Limited - India
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- New Zealand Coal & Carbon
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- McConnell Dowell - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Mining Services - Indonesia
- Sakthi Sugars Limited - India
- GVK Power & Infra Limited - India
- Central Electricity Authority - India
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Malabar Cements Ltd - India
- Goldman Sachs - Singapore
- Carbofer General Trading SA - India
- Electricity Authority, New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Manunggal Multi Energi - Indonesia
- South Luzon Thermal Energy Corporation
- Mercator Lines Limited - India
- AsiaOL BioFuels Corp., Philippines
- The University of Queensland
- Makarim & Taira - Indonesia
- Kumho Petrochemical, South Korea
- Maharashtra Electricity Regulatory Commission - India
- Australian Coal Association
- Meralco Power Generation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bangladesh Power Developement Board
- Port Waratah Coal Services - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Energy Exchange, India
- SMG Consultants - Indonesia
- Romanian Commodities Exchange
- Thai Mozambique Logistica
- Tata Chemicals Ltd - India
- Sindya Power Generating Company Private Ltd
- ICICI Bank Limited - India
- Electricity Generating Authority of Thailand
- Trasteel International SA, Italy
- Kepco SPC Power Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Chamber of Mines of South Africa
- Gujarat Electricity Regulatory Commission - India
- Straits Asia Resources Limited - Singapore
- Iligan Light & Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Siam City Cement PLC, Thailand
- Merrill Lynch Commodities Europe
- Binh Thuan Hamico - Vietnam
- Interocean Group of Companies - India
- Krishnapatnam Port Company Ltd. - India
- Larsen & Toubro Limited - India
- Ind-Barath Power Infra Limited - India
- Indo Tambangraya Megah - Indonesia
- Madhucon Powers Ltd - India
- SN Aboitiz Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Toyota Tsusho Corporation, Japan
- Kaltim Prima Coal - Indonesia
- Indian Oil Corporation Limited
- Leighton Contractors Pty Ltd - Australia
- Energy Development Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- Meenaskhi Energy Private Limited - India
- PNOC Exploration Corporation - Philippines
- Parliament of New Zealand
- Bhatia International Limited - India
- White Energy Company Limited
- Vedanta Resources Plc - India
- CNBM International Corporation - China
- OPG Power Generation Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Parry Sugars Refinery, India
- GMR Energy Limited - India
- Globalindo Alam Lestari - Indonesia
- Posco Energy - South Korea
- VISA Power Limited - India
- Metalloyd Limited - United Kingdom
- Anglo American - United Kingdom
- IEA Clean Coal Centre - UK
- Altura Mining Limited, Indonesia
- The State Trading Corporation of India Ltd
- Bhushan Steel Limited - India
- Dalmia Cement Bharat India
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Oldendorff Carriers - Singapore
- Gujarat Sidhee Cement - India
- Sarangani Energy Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Economic Council, Georgia
- PetroVietnam Power Coal Import and Supply Company
- Bayan Resources Tbk. - Indonesia
- Power Finance Corporation Ltd., India
- Banpu Public Company Limited - Thailand
- Grasim Industreis Ltd - India
- Central Java Power - Indonesia
- San Jose City I Power Corp, Philippines
- Aboitiz Power Corporation - Philippines
- London Commodity Brokers - England
- Directorate Of Revenue Intelligence - India
- Kartika Selabumi Mining - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Formosa Plastics Group - Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Semirara Mining and Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- The Treasury - Australian Government
- Rashtriya Ispat Nigam Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Pendopo Energi Batubara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Salva Resources Pvt Ltd - India
- Edison Trading Spa - Italy
- Lanco Infratech Ltd - India
- SMC Global Power, Philippines
- Coastal Gujarat Power Limited - India
- Heidelberg Cement - Germany
- Aditya Birla Group - India
- ASAPP Information Group - India
- Independent Power Producers Association of India
- Standard Chartered Bank - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- Siam City Cement - Thailand
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Semirara Mining Corp, Philippines
- Indogreen Group - Indonesia
- Attock Cement Pakistan Limited
- Baramulti Group, Indonesia
- CIMB Investment Bank - Malaysia
- Mercuria Energy - Indonesia
- Africa Commodities Group - South Africa
- Indonesian Coal Mining Association
- Cigading International Bulk Terminal - Indonesia
- Riau Bara Harum - Indonesia
- Jindal Steel & Power Ltd - India
- Orica Australia Pty. Ltd.
- Bharathi Cement Corporation - India
- Timah Investasi Mineral - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Simpson Spence & Young - Indonesia
- Uttam Galva Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Vizag Seaport Private Limited - India
- Coal and Oil Company - UAE
- Marubeni Corporation - India
- Energy Link Ltd, New Zealand
- Mjunction Services Limited - India
- Agrawal Coal Company - India
- Jaiprakash Power Ventures ltd
- Thiess Contractors Indonesia
- Antam Resourcindo - Indonesia
- Sojitz Corporation - Japan
- Karaikal Port Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Georgia Ports Authority, United States
- Ministry of Transport, Egypt
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Deloitte Consulting - India
- International Coal Ventures Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
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