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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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- Electricity Authority, New Zealand
- Renaissance Capital - South Africa
- Bayan Resources Tbk. - Indonesia
- Kideco Jaya Agung - Indonesia
- Economic Council, Georgia
- Uttam Galva Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- VISA Power Limited - India
- Binh Thuan Hamico - Vietnam
- Coastal Gujarat Power Limited - India
- Siam City Cement PLC, Thailand
- Thiess Contractors Indonesia
- LBH Netherlands Bv - Netherlands
- The Treasury - Australian Government
- Baramulti Group, Indonesia
- Salva Resources Pvt Ltd - India
- Tamil Nadu electricity Board
- Trasteel International SA, Italy
- Bahari Cakrawala Sebuku - Indonesia
- Australian Commodity Traders Exchange
- Madhucon Powers Ltd - India
- Ministry of Transport, Egypt
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Jindal Steel & Power Ltd - India
- Minerals Council of Australia
- Global Coal Blending Company Limited - Australia
- Larsen & Toubro Limited - India
- Sree Jayajothi Cements Limited - India
- AsiaOL BioFuels Corp., Philippines
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Indika Energy - Indonesia
- Borneo Indobara - Indonesia
- Pendopo Energi Batubara - Indonesia
- PowerSource Philippines DevCo
- GMR Energy Limited - India
- Latin American Coal - Colombia
- Maheswari Brothers Coal Limited - India
- ICICI Bank Limited - India
- Tata Chemicals Ltd - India
- Indogreen Group - Indonesia
- GAC Shipping (India) Pvt Ltd
- Interocean Group of Companies - India
- Commonwealth Bank - Australia
- GVK Power & Infra Limited - India
- Timah Investasi Mineral - Indoneisa
- PNOC Exploration Corporation - Philippines
- Oldendorff Carriers - Singapore
- Deloitte Consulting - India
- Energy Development Corp, Philippines
- PTC India Limited - India
- Standard Chartered Bank - UAE
- Anglo American - United Kingdom
- Semirara Mining Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- CNBM International Corporation - China
- SMG Consultants - Indonesia
- Iligan Light & Power Inc, Philippines
- Therma Luzon, Inc, Philippines
- Ministry of Mines - Canada
- Aboitiz Power Corporation - Philippines
- Chettinad Cement Corporation Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Kobexindo Tractors - Indoneisa
- Orica Mining Services - Indonesia
- Jaiprakash Power Ventures ltd
- Price Waterhouse Coopers - Russia
- Directorate General of MIneral and Coal - Indonesia
- Sakthi Sugars Limited - India
- Billiton Holdings Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Vedanta Resources Plc - India
- Marubeni Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- Indian Energy Exchange, India
- Xindia Steels Limited - India
- Kumho Petrochemical, South Korea
- IEA Clean Coal Centre - UK
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Directorate Of Revenue Intelligence - India
- India Bulls Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Parry Sugars Refinery, India
- Essar Steel Hazira Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Makmur.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Thai Mozambique Logistica
- Heidelberg Cement - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- London Commodity Brokers - England
- Samtan Co., Ltd - South Korea
- Makarim & Taira - Indonesia
- Wilmar Investment Holdings
- Barasentosa Lestari - Indonesia
- Rio Tinto Coal - Australia
- McConnell Dowell - Australia
- Neyveli Lignite Corporation Ltd, - India
- Posco Energy - South Korea
- Planning Commission, India
- Intertek Mineral Services - Indonesia
- Energy Link Ltd, New Zealand
- Ceylon Electricity Board - Sri Lanka
- Star Paper Mills Limited - India
- Meenaskhi Energy Private Limited - India
- CIMB Investment Bank - Malaysia
- MS Steel International - UAE
- European Bulk Services B.V. - Netherlands
- San Jose City I Power Corp, Philippines
- Bhatia International Limited - India
- Holcim Trading Pte Ltd - Singapore
- Power Finance Corporation Ltd., India
- Coal and Oil Company - UAE
- Cement Manufacturers Association - India
- Lanco Infratech Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Formosa Plastics Group - Taiwan
- Ministry of Finance - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Medco Energi Mining Internasional
- Central Electricity Authority - India
- Altura Mining Limited, Indonesia
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- TeaM Sual Corporation - Philippines
- The University of Queensland
- Simpson Spence & Young - Indonesia
- Bharathi Cement Corporation - India
- Jorong Barutama Greston.PT - Indonesia
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- Savvy Resources Ltd - HongKong
- South Luzon Thermal Energy Corporation
- Manunggal Multi Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- SN Aboitiz Power Inc, Philippines
- Mercuria Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- Dalmia Cement Bharat India
- Vizag Seaport Private Limited - India
- Carbofer General Trading SA - India
- Georgia Ports Authority, United States
- Bulk Trading Sa - Switzerland
- Kaltim Prima Coal - Indonesia
- Karaikal Port Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Electricity Generating Authority of Thailand
- Antam Resourcindo - Indonesia
- Meralco Power Generation, Philippines
- Ind-Barath Power Infra Limited - India
- Indo Tambangraya Megah - Indonesia
- Orica Australia Pty. Ltd.
- Merrill Lynch Commodities Europe
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coalindo Energy - Indonesia
- Bhushan Steel Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Wood Mackenzie - Singapore
- Straits Asia Resources Limited - Singapore
- IHS Mccloskey Coal Group - USA
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- New Zealand Coal & Carbon
- Globalindo Alam Lestari - Indonesia
- Attock Cement Pakistan Limited
- Videocon Industries ltd - India
- Aditya Birla Group - India
- Pipit Mutiara Jaya. PT, Indonesia
- Eastern Energy - Thailand
- Miang Besar Coal Terminal - Indonesia
- Central Java Power - Indonesia
- Parliament of New Zealand
- Gujarat Sidhee Cement - India
- Alfred C Toepfer International GmbH - Germany
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Goldman Sachs - Singapore
- SMC Global Power, Philippines
- Romanian Commodities Exchange
- Bhoruka Overseas - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mercator Lines Limited - India
- Chamber of Mines of South Africa
- Riau Bara Harum - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Australian Coal Association
- Mintek Dendrill Indonesia
- Grasim Industreis Ltd - India
- Ambuja Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- Indian Oil Corporation Limited
- Petron Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Toyota Tsusho Corporation, Japan
- Karbindo Abesyapradhi - Indoneisa
- Africa Commodities Group - South Africa
- Eastern Coal Council - USA
- Independent Power Producers Association of India
- Leighton Contractors Pty Ltd - Australia
- Bangladesh Power Developement Board
- White Energy Company Limited
- Global Business Power Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Bukit Baiduri Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Singapore Mercantile Exchange
- Petrochimia International Co. Ltd.- Taiwan
- ASAPP Information Group - India
- Sarangani Energy Corporation, Philippines
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