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Thursday, 10 May 18
PRIVATE POWER PRODUCERS NEED A 'POWERFUL PUSH' - PRADEEP MITTAL
 - PLF of the Private Sector in the country (Coal and Lignite based) for FY 2017-18 (till Dec 2017) is 56%.
- 51 GW of stressed assets (Thermal & gas) and around 23 GW of capacity under construction projects are likely to be stressed due to non-availability of Coal and lack of PPA’s.
- Of total 495 MT of coal supplied by CIL and its Subsidiary, Private sector received around 133 MT of coal for FY 2017-18 (Till Feb 2018).
- Post-GST private power producers witnessed an increase of nearly Rs 135/tonne on Imported Coal.
- Private players have to bear an increase of 12-15 paisa/Kwh post GST implementation in July 2017 and revised coal price notification by CIL (domestic coal) in Jan 2018.
- Non-availability of Long term fuel security (coal linkage or coal blocks), adequate long term PPA tenders by Discoms continues to hamper private power producers.
- Additional Capex requirement for meeting the revised environmental norms issued by MoEF
India is a power surplus country, really? Isn’t it an illusion? The poor health of State discoms compels them to buy less electricity. And ofcourse, load-shedding continues to torment the discoms. Nearly, 300 million people are expected to get electricity under the government’s ambitious
`Power for All’ initiative. Inadequate infrastructure for power transmission is believed to be the primary reason for the aforementioned number is deprived of electricity. The tag of Power Surplus Country — is it something really to cherish?
Imbalanced coal supply: Public Vs private power producers
Insufficient coal supply to thermal power plants is taking a huge toll on electricity generation. According to Coal Ministry data, of total 495 million tonne (MT), Coal India Ltd (CIL) has supplied 362 MT (accounting for 73%) to public sector thermal power plants from April 2017 to February 2018. On the other hand, private thermal power plants received 133 MT during these ten months, which accounts for 27% of total coal supplied to IPP’s. The supply of thermal grade coal (G11 to G12) is likely to remain in the same proportion in coming years. Moreover, the recent coal price hike will translate to 12-15 paisa/kWh and is a major setback to the IPP’s as most of the Case-1 competitive bidding PPAs do not allow pass through of increase in coal price to producers, whereas for public power plants the PPA’s are signed under Section-62 which allows the pass through of increased coal cost. As the IPP’s are already hit by increasing operating costs, private power producers badly need optimum coal supply with a slash in current coal prices. Further, Inadequate coal supply forces the private power plants to opt for imported coal where the current duty structure puts them on a receiving end.
Duty structure for Imported Thermal coal -a dampener
In the wake of the insufficient coal availability, imported thermal coal remains the only way out to meet the rising fuel demand for power generation. However, the duty structure for thermal coal only adds to increase in imported thermal coal prices. Pre-GST private power producers were paying Rs 515/tones on an assessable value of Rs 5000/tone, which includes CVD of 2% of assessable value; a green energy cess of Rs 400/tonne, and education cess of 3% on total duty component. Post-GST, power producers have to pay IGST of 5% of assessable value and GST compensation cess to the tune of Rs 400 /tonne, which makes the total payment to Rs. 650/tonne. us, power producers face an increase of Rs.135/tonne which is translated to approximately 9 paisa/ kWh. is additional amount is claimed under Change of Law, but regulatory delays force power producers to bear the brunt of duty structure.
In the case of thermal coal imported from other countries like South Africa, Australia, Columbia, etc. only basic duty has been abolished from 2.5% in pre-GST era, while other components such as CVD, green energy cess and education cess are combined under IGST of 5% of total assessable value. us, private power producers have to pay extra Rs. 131/tones on thermal coal imported from abovementioned countries, which is translated to —9 paisa/kWh.
It is also pertinent to note that the green cess has increased to Rs. 400/tonne from Rs. 50/tonne over the years. Unfortunately, power tariffs have not come across the same trend.
Coal price hike adding to private power producers’ woes
The private power plant operators are already facing acute problem of coal supply and an increase of nearly 11% in thermal grade coal (G-11) has further marred the operating cost. Between May-2016 and January-2018, price of G-11 grade thermal coal has gone up by 11% to Rs 1,849/tones, which is likely to translate to 12-15 paisa/kWh in power cost.
The nature of signed PPAs under competitive bidding with state discoms does not allow the private power producers to claim any change in coal prices by CIL under Change in Law. And eventually, power generators have to bear the extra burden. On the contrary, power PSUs have a cost plus PPA with discoms and they enjoy the benefit of passing on the impact of coal price hike to discoms and thereafter to consumers.
Sluggish coal supply and absence of linkages likely to lead to more NPAs
According to estimates, NPAs in the power sector is anticipated to be around Rs. 4 lakh crore. Due to non-availability of coal and linkages many power plants were forced to shut and turned into stressed assets. Further, the lenders have also stopped funding which were already taken at higher interest rates. Government’s initiatives for providing adequate coal and long term fuel linkages have not fetched positive results which led the private power producers surrendering prices. e government aims to add 47 GW of coal-fired capacity by 2022. However, at this juncture, no private power producer will come up with fresh investment unless and until the current issues are resolved. If the private power producers receive a substantial capital push along with revised framework for coal supply and coal linkages, at least unfinished power projects can see the light of day.
Article by Mr. Pradeep Mittal Executive Vice Chairman, Essar Power Ltd.
Source : Electrical & Power Info, April-May 2018
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Friday, 18 May 18
AFTER COAL, INDONESIAN GOVERNMENT PUSHES DMO ON GAS FOR ELECTRICITY
After introducing its domestic market obligation (DMO) policy for coal on March 12, the government is going forward with its plan to introduce a DM ...
Friday, 18 May 18
INDONESIA'S SAMARINDA ANCHORAGE COAL LOADING ACTIVITIES WERE RESUMED YESTERDAY AT 4PM LOCAL TIME
Samarinda Anchorage coal loading activities were resumed yesterday at 4PM local time.
Local fishermen in Samarinda Anchorage have been demonst ...
Wednesday, 16 May 18
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
Half-way through the second quarter of the year and as the Posidonia week approaches everyone is getting ready for this unique gathering that besid ...
Tuesday, 08 May 18
BUMA SIGNED OVER US$1 BILLION WORTH OF NEW CONTRACT WITH PT INDONESIA PRATAMA
PT Delta Dunia Makmur Tbk. announced that its subsidiary, PT Bukit Makmur Mandiri Utama, has entered into mining services contracts with PT Indones ...
Monday, 07 May 18
BENCHMARK PRICE OF INDONESIAN THERMAL COAL DROPPED BACK BELOW $90 A TON THIS MONTH
COALspot.com: According to latest ministerial decree No. 1812 K/30/MEM/2018 dated 3 May 2018, the Indonesian Coal Price Reference (HBA) decline 5.5 ...
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- Siam City Cement PLC, Thailand
- Larsen & Toubro Limited - India
- Xindia Steels Limited - India
- Sical Logistics Limited - India
- Mercuria Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Wood Mackenzie - Singapore
- MS Steel International - UAE
- Directorate Of Revenue Intelligence - India
- Indika Energy - Indonesia
- Ministry of Mines - Canada
- Marubeni Corporation - India
- PNOC Exploration Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Grasim Industreis Ltd - India
- GAC Shipping (India) Pvt Ltd
- Miang Besar Coal Terminal - Indonesia
- Sindya Power Generating Company Private Ltd
- Indogreen Group - Indonesia
- Kideco Jaya Agung - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Cement Manufacturers Association - India
- Bahari Cakrawala Sebuku - Indonesia
- Orica Australia Pty. Ltd.
- International Coal Ventures Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Trasteel International SA, Italy
- Dalmia Cement Bharat India
- Global Green Power PLC Corporation, Philippines
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- Tata Chemicals Ltd - India
- OPG Power Generation Pvt Ltd - India
- Medco Energi Mining Internasional
- Ministry of Transport, Egypt
- Central Java Power - Indonesia
- Kumho Petrochemical, South Korea
- Bangladesh Power Developement Board
- The University of Queensland
- ASAPP Information Group - India
- Coastal Gujarat Power Limited - India
- Makarim & Taira - Indonesia
- SMG Consultants - Indonesia
- Timah Investasi Mineral - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- Binh Thuan Hamico - Vietnam
- Merrill Lynch Commodities Europe
- Meralco Power Generation, Philippines
- Savvy Resources Ltd - HongKong
- Simpson Spence & Young - Indonesia
- Australian Coal Association
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- CIMB Investment Bank - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Petron Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Attock Cement Pakistan Limited
- Karbindo Abesyapradhi - Indoneisa
- Mercator Lines Limited - India
- Madhucon Powers Ltd - India
- Salva Resources Pvt Ltd - India
- Mintek Dendrill Indonesia
- Parliament of New Zealand
- Kepco SPC Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- Deloitte Consulting - India
- Alfred C Toepfer International GmbH - Germany
- Central Electricity Authority - India
- Thai Mozambique Logistica
- Kobexindo Tractors - Indoneisa
- Uttam Galva Steels Limited - India
- Economic Council, Georgia
- Sinarmas Energy and Mining - Indonesia
- Aboitiz Power Corporation - Philippines
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- Global Business Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Videocon Industries ltd - India
- Global Coal Blending Company Limited - Australia
- VISA Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Sarangani Energy Corporation, Philippines
- Ambuja Cements Ltd - India
- The Treasury - Australian Government
- Bhatia International Limited - India
- San Jose City I Power Corp, Philippines
- Edison Trading Spa - Italy
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Minerals Council of Australia
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Leighton Contractors Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Interocean Group of Companies - India
- Indo Tambangraya Megah - Indonesia
- Africa Commodities Group - South Africa
- Vedanta Resources Plc - India
- Orica Mining Services - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Therma Luzon, Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- LBH Netherlands Bv - Netherlands
- Singapore Mercantile Exchange
- Thiess Contractors Indonesia
- Standard Chartered Bank - UAE
- Maheswari Brothers Coal Limited - India
- Bukit Makmur.PT - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Sakthi Sugars Limited - India
- PowerSource Philippines DevCo
- White Energy Company Limited
- IEA Clean Coal Centre - UK
- Kapuas Tunggal Persada - Indonesia
- Planning Commission, India
- Indian Energy Exchange, India
- Riau Bara Harum - Indonesia
- Jaiprakash Power Ventures ltd
- IHS Mccloskey Coal Group - USA
- GN Power Mariveles Coal Plant, Philippines
- Karaikal Port Pvt Ltd - India
- Georgia Ports Authority, United States
- Baramulti Group, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- India Bulls Power Limited - India
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Goldman Sachs - Singapore
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- Ind-Barath Power Infra Limited - India
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- London Commodity Brokers - England
- Iligan Light & Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Indian Oil Corporation Limited
- Romanian Commodities Exchange
- ICICI Bank Limited - India
- Energy Development Corp, Philippines
- New Zealand Coal & Carbon
- Port Waratah Coal Services - Australia
- Kohat Cement Company Ltd. - Pakistan
- Bukit Asam (Persero) Tbk - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Kaltim Prima Coal - Indonesia
- Eastern Energy - Thailand
- Coalindo Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Independent Power Producers Association of India
- Vizag Seaport Private Limited - India
- Eastern Coal Council - USA
- Globalindo Alam Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Toyota Tsusho Corporation, Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tamil Nadu electricity Board
- Bukit Baiduri Energy - Indonesia
- Straits Asia Resources Limited - Singapore
- Heidelberg Cement - Germany
- Commonwealth Bank - Australia
- Parry Sugars Refinery, India
- Borneo Indobara - Indonesia
- Australian Commodity Traders Exchange
- Rio Tinto Coal - Australia
- Metalloyd Limited - United Kingdom
- Aditya Birla Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Mjunction Services Limited - India
- Billiton Holdings Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Latin American Coal - Colombia
- Energy Link Ltd, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Finance - Indonesia
- Lanco Infratech Ltd - India
- Oldendorff Carriers - Singapore
- Semirara Mining Corp, Philippines
- Star Paper Mills Limited - India
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- Coal and Oil Company - UAE
- GMR Energy Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Essar Steel Hazira Ltd - India
- Electricity Generating Authority of Thailand
- Electricity Authority, New Zealand
- TeaM Sual Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- PTC India Limited - India
- Jindal Steel & Power Ltd - India
- Indonesian Coal Mining Association
- Holcim Trading Pte Ltd - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Sidhee Cement - India
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- McConnell Dowell - Australia
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Bharathi Cement Corporation - India
- Chettinad Cement Corporation Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Altura Mining Limited, Indonesia
- GVK Power & Infra Limited - India
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