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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, 25 April 12
CHINA IMPORTS 9.76 MMT AND INDIA IMPORTS 7.03 MMT OF INDONESIAN COAL LAST MONTH
COALspot.com: Indonesia, the world largest coal exporter, shipped 30.64* million tons of coal in March 2012, compared to 27.12* million tons i ...
Monday, 23 April 12
ALTURA ENTERS INTO AGREEMENT TO ACQUIRE 2 COAL PROJECTS IN SOUTH KALIMANTAN
COALspot.com - Altura Mining Limited (ASX: AJM) has announced that it has entered into an agreement to acquire a further two (2) Mining Permits (IUP ...
Sunday, 22 April 12
THE FREIGHT MARKET EXPECTED TO REMAIN FIRM NEXT WEEK - VISTAAR
COALspot.com - The BDI has broken the psychological barrier of 1000 points and closed at 1067 points.
The cape index was slightly down by 2.48 pc ...
Saturday, 21 April 12
INDONESIAN SUB-BITUMINOUS COAL SWAPS DROP 2.61 PERCENT THIS WEEK
COALspot.com - Indonesian sub-bituminous coal swaps fell for a fifth day, according to DSP of SGX AsiaClear OTC Coal Swaps.
CFR South China Coal ...
Friday, 20 April 12
PANAMAXES LEAD DRY BULK MARKET TO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A rebound of demand for smaller dry bulk carriers has led the industry’s benchmark, the BDI (Baltic Dry Index) above the 1,000-point mark for ...
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- Energy Development Corp, Philippines
- Mjunction Services Limited - India
- TeaM Sual Corporation - Philippines
- Global Green Power PLC Corporation, Philippines
- Lanco Infratech Ltd - India
- Kideco Jaya Agung - Indonesia
- Bukit Baiduri Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Sinarmas Energy and Mining - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Indogreen Group - Indonesia
- Singapore Mercantile Exchange
- Asmin Koalindo Tuhup - Indonesia
- Eastern Energy - Thailand
- Siam City Cement - Thailand
- Coalindo Energy - Indonesia
- Ministry of Mines - Canada
- TNB Fuel Sdn Bhd - Malaysia
- Indo Tambangraya Megah - Indonesia
- Xindia Steels Limited - India
- Bukit Makmur.PT - Indonesia
- Orica Australia Pty. Ltd.
- Ministry of Transport, Egypt
- Central Java Power - Indonesia
- Thiess Contractors Indonesia
- Alfred C Toepfer International GmbH - Germany
- Energy Link Ltd, New Zealand
- VISA Power Limited - India
- London Commodity Brokers - England
- Chamber of Mines of South Africa
- Kalimantan Lumbung Energi - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Intertek Mineral Services - Indonesia
- Bhushan Steel Limited - India
- Wood Mackenzie - Singapore
- Aditya Birla Group - India
- Indika Energy - Indonesia
- Parliament of New Zealand
- Sojitz Corporation - Japan
- Petrochimia International Co. Ltd.- Taiwan
- Kobexindo Tractors - Indoneisa
- Metalloyd Limited - United Kingdom
- Vijayanagar Sugar Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Simpson Spence & Young - Indonesia
- Bulk Trading Sa - Switzerland
- Globalindo Alam Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- The State Trading Corporation of India Ltd
- Sree Jayajothi Cements Limited - India
- Coal and Oil Company - UAE
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Business Power Corporation, Philippines
- MS Steel International - UAE
- Port Waratah Coal Services - Australia
- PowerSource Philippines DevCo
- Heidelberg Cement - Germany
- Indian Oil Corporation Limited
- New Zealand Coal & Carbon
- IHS Mccloskey Coal Group - USA
- Central Electricity Authority - India
- LBH Netherlands Bv - Netherlands
- Sindya Power Generating Company Private Ltd
- ASAPP Information Group - India
- Grasim Industreis Ltd - India
- Star Paper Mills Limited - India
- Karaikal Port Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Coal Council - USA
- ICICI Bank Limited - India
- Marubeni Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- SMC Global Power, Philippines
- McConnell Dowell - Australia
- European Bulk Services B.V. - Netherlands
- Savvy Resources Ltd - HongKong
- Mercuria Energy - Indonesia
- Indian Energy Exchange, India
- Kohat Cement Company Ltd. - Pakistan
- Directorate General of MIneral and Coal - Indonesia
- India Bulls Power Limited - India
- CIMB Investment Bank - Malaysia
- Uttam Galva Steels Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Tata Chemicals Ltd - India
- Semirara Mining and Power Corporation, Philippines
- SMG Consultants - Indonesia
- Essar Steel Hazira Ltd - India
- Medco Energi Mining Internasional
- Gujarat Sidhee Cement - India
- Australian Coal Association
- Jorong Barutama Greston.PT - Indonesia
- Bayan Resources Tbk. - Indonesia
- Manunggal Multi Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- Mintek Dendrill Indonesia
- Bhatia International Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Billiton Holdings Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Larsen & Toubro Limited - India
- South Luzon Thermal Energy Corporation
- Edison Trading Spa - Italy
- Price Waterhouse Coopers - Russia
- White Energy Company Limited
- Bharathi Cement Corporation - India
- GMR Energy Limited - India
- Global Coal Blending Company Limited - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- The Treasury - Australian Government
- Renaissance Capital - South Africa
- Semirara Mining Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Altura Mining Limited, Indonesia
- Independent Power Producers Association of India
- Makarim & Taira - Indonesia
- Power Finance Corporation Ltd., India
- Goldman Sachs - Singapore
- Georgia Ports Authority, United States
- Electricity Generating Authority of Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Planning Commission, India
- Dalmia Cement Bharat India
- Rashtriya Ispat Nigam Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Anglo American - United Kingdom
- Ambuja Cements Ltd - India
- Australian Commodity Traders Exchange
- Deloitte Consulting - India
- Electricity Authority, New Zealand
- OPG Power Generation Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Romanian Commodities Exchange
- Wilmar Investment Holdings
- Petron Corporation, Philippines
- Interocean Group of Companies - India
- Pendopo Energi Batubara - Indonesia
- Chettinad Cement Corporation Ltd - India
- Salva Resources Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Oldendorff Carriers - Singapore
- Posco Energy - South Korea
- PTC India Limited - India
- Africa Commodities Group - South Africa
- Indonesian Coal Mining Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- International Coal Ventures Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Commonwealth Bank - Australia
- Kepco SPC Power Corporation, Philippines
- Minerals Council of Australia
- Orica Mining Services - Indonesia
- Kapuas Tunggal Persada - Indonesia
- San Jose City I Power Corp, Philippines
- Ministry of Finance - Indonesia
- Latin American Coal - Colombia
- CNBM International Corporation - China
- Jaiprakash Power Ventures ltd
- Rio Tinto Coal - Australia
- Parry Sugars Refinery, India
- Standard Chartered Bank - UAE
- Thai Mozambique Logistica
- Jindal Steel & Power Ltd - India
- The University of Queensland
- Kumho Petrochemical, South Korea
- Binh Thuan Hamico - Vietnam
- Vedanta Resources Plc - India
- Siam City Cement PLC, Thailand
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- Formosa Plastics Group - Taiwan
- Bangladesh Power Developement Board
- Meenaskhi Energy Private Limited - India
- Kartika Selabumi Mining - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- GVK Power & Infra Limited - India
- Meralco Power Generation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Riau Bara Harum - Indonesia
- Cement Manufacturers Association - India
- Economic Council, Georgia
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Mercator Lines Limited - India
- Videocon Industries ltd - India
- Maheswari Brothers Coal Limited - India
- Samtan Co., Ltd - South Korea
- Antam Resourcindo - Indonesia
- Sakthi Sugars Limited - India
- Miang Besar Coal Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Baramulti Group, Indonesia
- Agrawal Coal Company - India
- Vizag Seaport Private Limited - India
- Banpu Public Company Limited - Thailand
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Attock Cement Pakistan Limited
- Carbofer General Trading SA - India
- Malabar Cements Ltd - India
- Borneo Indobara - Indonesia
- Merrill Lynch Commodities Europe
- Directorate Of Revenue Intelligence - India
- IEA Clean Coal Centre - UK
- AsiaOL BioFuels Corp., Philippines
- Leighton Contractors Pty Ltd - Australia
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