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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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Monday, 20 August 12
CHINESE COAL SWAPS RISE, INDONESIAN COAL CONTRACTS SOFT
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for October 2012 delivery lost -2.05 percent W-o-W on Friday (17 August 2012) closing but gained ...
Saturday, 18 August 12
BULK FREIGHT MARKETS CONTINUED THEIR DECLINE IN LINE WITH WEAK DEMAND - VISTAAR
COALspot.com - This week also the indices fell on all segments with BDI touching lowest in almost 3 years.
The BDI closed at 714 points down by 7 ...
Thursday, 16 August 12
PUBLIC PRIVATE PARTNERSHIPS CONFERENCE 2012
Press Release - Asia’s Premier Public Private Partnerships Conference 2012 will showcase commercial opportunities for investors and developers ...
Wednesday, 15 August 12
UT GENERATED RP 3.09 TRILLION NET INCOME
COALspot.com - As of June 2012 Indonesia’s heavy equipment market grew 14%, from 8,448 units to 9,618 units (based on UT’s internal mark ...
Tuesday, 14 August 12
SAKARI ENTERED INTO JV IN CAMBODIA TO EXPLORE COAL OPPORTUNITIES
COALspot.com - Sakari joints hands with The Royal Group of Companies in Cambodia to explore and develop coal opportunities throughout the country.
...
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- Salva Resources Pvt Ltd - India
- Orica Mining Services - Indonesia
- Gujarat Electricity Regulatory Commission - India
- TNB Fuel Sdn Bhd - Malaysia
- Kideco Jaya Agung - Indonesia
- McConnell Dowell - Australia
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- Bayan Resources Tbk. - Indonesia
- Sical Logistics Limited - India
- Thiess Contractors Indonesia
- Standard Chartered Bank - UAE
- Merrill Lynch Commodities Europe
- Semirara Mining and Power Corporation, Philippines
- CNBM International Corporation - China
- Globalindo Alam Lestari - Indonesia
- GVK Power & Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- Pendopo Energi Batubara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Port Waratah Coal Services - Australia
- Uttam Galva Steels Limited - India
- Dalmia Cement Bharat India
- Formosa Plastics Group - Taiwan
- The University of Queensland
- Toyota Tsusho Corporation, Japan
- IEA Clean Coal Centre - UK
- Energy Link Ltd, New Zealand
- Wood Mackenzie - Singapore
- Coal and Oil Company - UAE
- Global Business Power Corporation, Philippines
- Medco Energi Mining Internasional
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Grasim Industreis Ltd - India
- ICICI Bank Limited - India
- Mintek Dendrill Indonesia
- Australian Commodity Traders Exchange
- Kobexindo Tractors - Indoneisa
- Thai Mozambique Logistica
- ASAPP Information Group - India
- White Energy Company Limited
- VISA Power Limited - India
- Minerals Council of Australia
- OPG Power Generation Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Ministry of Mines - Canada
- International Coal Ventures Pvt Ltd - India
- Anglo American - United Kingdom
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Attock Cement Pakistan Limited
- Pipit Mutiara Jaya. PT, Indonesia
- Iligan Light & Power Inc, Philippines
- Semirara Mining Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SN Aboitiz Power Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate General of MIneral and Coal - Indonesia
- Makarim & Taira - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Goldman Sachs - Singapore
- Jindal Steel & Power Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- New Zealand Coal & Carbon
- PNOC Exploration Corporation - Philippines
- Indogreen Group - Indonesia
- Independent Power Producers Association of India
- Sree Jayajothi Cements Limited - India
- CIMB Investment Bank - Malaysia
- GMR Energy Limited - India
- Deloitte Consulting - India
- India Bulls Power Limited - India
- PowerSource Philippines DevCo
- Maheswari Brothers Coal Limited - India
- Savvy Resources Ltd - HongKong
- Bulk Trading Sa - Switzerland
- Sindya Power Generating Company Private Ltd
- Tata Chemicals Ltd - India
- Central Electricity Authority - India
- Indian Energy Exchange, India
- Bhoruka Overseas - Indonesia
- Oldendorff Carriers - Singapore
- Bangladesh Power Developement Board
- Bank of Tokyo Mitsubishi UFJ Ltd
- Georgia Ports Authority, United States
- Ministry of Finance - Indonesia
- Mercator Lines Limited - India
- Romanian Commodities Exchange
- Commonwealth Bank - Australia
- Indo Tambangraya Megah - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Interocean Group of Companies - India
- London Commodity Brokers - England
- Coastal Gujarat Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Marubeni Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Malabar Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Videocon Industries ltd - India
- Central Java Power - Indonesia
- Meenaskhi Energy Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Indian Oil Corporation Limited
- Eastern Coal Council - USA
- Jaiprakash Power Ventures ltd
- Mjunction Services Limited - India
- The State Trading Corporation of India Ltd
- Parry Sugars Refinery, India
- Planning Commission, India
- Kalimantan Lumbung Energi - Indonesia
- Tamil Nadu electricity Board
- Vizag Seaport Private Limited - India
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- Simpson Spence & Young - Indonesia
- PTC India Limited - India
- IHS Mccloskey Coal Group - USA
- Global Coal Blending Company Limited - Australia
- Ambuja Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Singapore Mercantile Exchange
- Australian Coal Association
- Therma Luzon, Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Barasentosa Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Ind-Barath Power Infra Limited - India
- Altura Mining Limited, Indonesia
- Cement Manufacturers Association - India
- Larsen & Toubro Limited - India
- Timah Investasi Mineral - Indoneisa
- Indonesian Coal Mining Association
- Chamber of Mines of South Africa
- Eastern Energy - Thailand
- Intertek Mineral Services - Indonesia
- Ministry of Transport, Egypt
- Aditya Birla Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Mercuria Energy - Indonesia
- Bhatia International Limited - India
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Indika Energy - Indonesia
- SMG Consultants - Indonesia
- LBH Netherlands Bv - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Antam Resourcindo - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement PLC, Thailand
- Essar Steel Hazira Ltd - India
- GAC Shipping (India) Pvt Ltd
- Asmin Koalindo Tuhup - Indonesia
- Bukit Makmur.PT - Indonesia
- Electricity Authority, New Zealand
- Kepco SPC Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- Latin American Coal - Colombia
- SMC Global Power, Philippines
- Vedanta Resources Plc - India
- MS Steel International - UAE
- Star Paper Mills Limited - India
- Electricity Generating Authority of Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wilmar Investment Holdings
- Madhucon Powers Ltd - India
- Kaltim Prima Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Meralco Power Generation, Philippines
- Sojitz Corporation - Japan
- Heidelberg Cement - Germany
- Holcim Trading Pte Ltd - Singapore
- Renaissance Capital - South Africa
- Karaikal Port Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kumho Petrochemical, South Korea
- TeaM Sual Corporation - Philippines
- Petron Corporation, Philippines
- Siam City Cement - Thailand
- Global Green Power PLC Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Energy Development Corp, Philippines
- Agrawal Coal Company - India
- Riau Bara Harum - Indonesia
- Trasteel International SA, Italy
- Krishnapatnam Port Company Ltd. - India
- San Jose City I Power Corp, Philippines
- Bhushan Steel Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Sakthi Sugars Limited - India
- Coalindo Energy - Indonesia
- Economic Council, Georgia
- Bukit Baiduri Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Carbofer General Trading SA - India
- Sarangani Energy Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Rio Tinto Coal - Australia
- GN Power Mariveles Coal Plant, Philippines
- Africa Commodities Group - South Africa
- Orica Australia Pty. Ltd.
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- Directorate Of Revenue Intelligence - India
- Bharathi Cement Corporation - India
- Binh Thuan Hamico - Vietnam
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