Energy News Monitor | Volume XIV; Issue 5

     Energy News, ENM, July, Energy News Monitor
    Source: Isr

    SOLAR POWER TARIFF REPLACES CRUDE PRICE AS THE MOST WATCHED NUMBER

    Non-Fossil Fuels News Commentary: June – July 2017

    India

    India’s latest solar auction, one of the biggest in the country, drew a surprisingly enthusiastic response with a big chunk of the 1,500 MW of projects on offer won by public sector mining giant NLC India Ltd. The lowest bid in the auction in Tamil Nadu, where solar radiation is weaker than in Rajasthan, came from Bengaluru-based Raasi Green Earth Energy, which won 100 MW at ₹ 3.47/kWh. Bids were invited in May and the results were declared. The tariff of ₹ 3.47/kWh is well above the lowest solar bid in the country so far of ₹ 2.44/kWh made at an auction at the Bhadla Solar Park in Rajasthan in May, but it is a substantial drop from the winning bid of  ₹ 4.40/kWh at Tamil Nadu’s auction in February. The biggest winner was public sector mining giant NLC India, which had bid for the entire 1500 MW, but was awarded 449 MW. The company mines lignite, which is also called brown coal, and generates power.  What is interesting to note is that domestic investment in large solar projects is coming from large fossil fuels companies particularly coal companies. Notwithstanding attractive subsidies, experts said that some political pressure to invest in solar energy could not be ruled out.

    Joining the NLC is CIL the world’s largest miner of coal which said that it will generate 1 GW of renewable electricity this year as part of its plan to produce as much as 10 GW clean power in total in a bid to reduce its carbon footprint. Even Rashtriya Ispat Nigam Ltd a steel company is said to have been advised to make a foray into solar and renewable energy to reduce dependence on fossil fuels to generate thermal power.

    State companies such as CIL and NTPC Ltd, the country’s biggest thermal power producer, are planning to aggressively spend on solar projects probably out of pressure from the central government. Solar power generation capacity has more than tripled in three years to over 12 GW. Indian solar power plant developers – including companies backed by Japan’s Softbank and Goldman Sachs – are meanwhile quoting ever-lower tariffs in auctions to win big projects, raising questions over India’s role in the renewable energy market. Experts say that the choice of becoming a consumer rather than producer of renewable technologies India may bear a disproportionate share of the cost of making a transition to low carbon energy sources. While financial and non-financial subsidies (such as RPOs or feed in tariffs that are underwritten by tax payers or rate payers) make solar energy investment an attractive option for overseas and domestic investors, the domestic socialisation of the large transaction costs of integrating intermittent and uncertain solar energy into a grid committed to 24*7 electricity service imposed costs on an economically challenged sections of the population.  Some social science experts commented that India may be producing a global public good (carbon reduction) at domestic cost which is not necessarily equitable.

    Yet another crutch was offered to solar power with transmission subsidies.  Solar power projects will be exempted from interstate transmission charges till the end of December 2019, making it feasible to compete with thermal power. The decision was taken by the power ministry in consultation with the MNRE and other stakeholders since imposition of charges would have raised cost of using solar power from another state by ₹1-2.50/kWh, depending on the distance it is transmitted and voltage at which it is supplied. The Delhi Metro Rail Corp, for example, signed an agreement in April to draw most of its daytime power needs from the 750 MW ultra mega solar power project – three plants of 250 MW each – being built at the Rewa solar park, Madhya Pradesh.

    Providing solar pumps to farmers is the new give away scheme that cannot be easily be criticised by economic observers even if they are committed to liberal market fundamentals as it involves solar energy which is enjoying divine status.  A number of states are unrolling massive subsidy schemes to offer expensive solar pumps to farmers.  The Punjab government plans to set up solar photovoltaic projects to run over 2000 agriculture pump sets by extending 80 percent subsidy in FY18. In the budgetary provision for FY18 an allocation of ₹1 billion was made under the scheme. Punjab provides free power to over 1 million agriculture tube-wells and incumbent Congress government has announced to continue the subsidy on power. The state government was liable to pay ₹ 63 billion as power subsidy to Punjab State Power Corp Ltd for supply to agriculture sector, BPL and SC households in FY17 as per the tariff orders of Punjab State Electricity Board.

    Not to be left out farmers in Tamil Nadu too can avail themselves of 90 percent subsidy for solar-powered irrigation pump sets if they exit the waiting list for farm connections. The State government will give 1,000 solar-powered irrigation pump sets of 5, 7.5 and 10 hp under a model programme to farmers across the State. These off grid units will be available with 40 percent State government subsidy, 20 percent from the Union Ministry of New and Renewable Energy; 30 percent from Tamil Nadu Generation and Distribution Corporation and the farmer’s share will be 10 percent. This scheme will be implemented at a cost of ₹ 150 million. To avail this benefit, farmers will have to apply for irrigation pump sets under the seniority scheme. The government will also offer Tatkal scheme in which farmers can get conventional agriculture connection within six months of application. They will have to shell out ₹ 250,000 for a 5 hp motor connection; ₹ 275,000 for a 7.5 hp motor supply; and ₹ 300,000 for a 10 hp supply. The connection will be provided within six months for 10,000 applicants. The government also plans to establish a 500 MW solar park through a private player; and a mobile app will also be developed for power consumers to pay their utility bills.

    In addition, over 12,000 solar pumps have been distributed so far to the farmers at subsidised rates under ‘Saur Sujala Yojna’ in Chhattisgarh. Focus will be on 85 tribal-dominated development blocks for the distribution of the solar energy-based irrigation pumps. 20,000 farmers may be covered under this scheme by the end of this year and farmers belonging to remote areas and inaccessible regions, should be given priority while distribution. Farmers are being provided solar-irrigation pumps of 5 hp and 3 hp at heavily subsidized rates in the state. Solar irrigation pump worth ₹ 350,000 (3 hp) is being given to Scheduled Caste and Scheduled Tribe classes at the cost of ₹ 7,000, to Other Backward Class (OBC) at ₹ 12,000 and general category farmers at ₹ 18,000. The remaining amount is borne by the state government.

    Gujarat saw its highest ever levels of power generation from wind energy, thanks to high wind velocities on its coast and steadily increasing generation capacity. Wind power generation in the state reached a record 3,460 MW on June 20, 2017. The rise also come as a major relief to GUVNL, which is currently getting less from private companies under PPAs. According to data from the Union ministry of new and renewable energy, of all the states, Gujarat added the second highest wind power generation capacity, 1,275 MW, in FY17. The state currently has total installed capacity of 5,339 MW. Wind power production has picked up at a time when the state-run power utility has been getting less power from private sector power producers for quite a while. GUVNL is bullish on green power to meet its future needs. The state entity recently invited bids to purchase 1,000 MW of renewable energy. GUVNL floated tenders to procure 500 MW each from wind and solar power projects, to fulfil its RPOs and meet the future needs of its distribution companies.

    Attracted by the opportunities in India’s green energy space, Rosatom State Atomic Energy Corp. is planning to enter the country’s renewable energy sector. To start with, the Moscow-based Rosatom, through its unit JSC OTEK, may acquire wind energy projects in India. Rosatom, which has a partnership with NPCIL for the Kudankulam nuclear plant in Tamil Nadu, is also planning to set up small hydropower projects in the country. Rosatom’s India strategy follows US withdrawal from the Paris climate agreement on grounds the deal favoured India and China and was unfair to the US. Of the total capacity targeted, 60 GW is to come from wind power. Wind power is the major component of India’s renewable sector. Of India’s 57.26 GW of installed renewable energy capacity, wind power accounts for over 56% or 32.27 GW. Having control over the supply chain will help Rosatom in reining in costs and offering competitive tariffs as India’s wind energy sector moves away from feed-in tariffs to an auction-based market. SECI plans to auction 4,000 MW of wind energy power-purchase contracts every year. With the disruption caused by India’s low clean energy tariffs playing out, rating agency Crisil cautioned that the risk profile of wind projects will increase. India’s ultra thermal plants, designed to run on foreign coal, may no longer afford to do so economically in the future, Tim Buckley, Director of Energy Finance Studies Australasia with the IEEFA said. This can be seen in the case of India’s two largest thermal power projects in Gujarat’s port town of Mundra — Adani Power’s 4.6 GW and Tata Power’s 4 GW plants. Both are no longer competitive owing to nearly doubled price rise of coal from Indonesia since their planning and incapability to hike tariffs, Buckley said. Adanis’ Mundra plant has previously been disclosed to be operating with 100 percent imported coal from Indonesia while Adani Power has been operating at a net loss, and has been doing so for the last seven years, Buckley said. As India works through and resolves domestic supply shortages, the need for imported thermal coal will continue to progressively decline. India targets for all public sector undertakings to be using 100 percent domestic coal by this fiscal, following NTPC’s move to virtually cease coal imports in 2016-17. An IEEFA report titled “NTPC as a Force in India’s Electricity Transition” showcases how the Indian government is shifting rapidly towards a low-carbon economy — a step towards achieving the 2015 Paris Climate Agreement aim of cutting greenhouse gases from burning fossil fuels. India’s draft “Ten Year Electricity Plan” calls for a staggering 275 GW of renewable energy by 2027, in addition to 72 GW of hydro and 15 GW of nuclear energy.

    An Indian social business has launched the country’s first solar satellite television service, bringing clean energy powered entertainment to households and businesses through a pay-as-you-go payment scheme. Simpa Networks, which began operations in 2011, is one of thousands of social enterprises in India tapping into the renewable energy market in a country where one-fifth of the 1.3 billion population has no access to electricity. With the majority of those without power from poor communities in countryside, the company focuses on selling solar powered products such as LED lights, phone charging points and fans on financing to rural homes and shops in northern India. The system, which includes an 80 W solar panel, 20″ energy efficient LED television, battery, solar charge controller, is available on a repayment plan of up to 36 months. Interest applies but approximate rates were not revealed. Customers make an initial payment to have the system installed then use a pay-as-you-go model for the electricity. The payments contribute to total cost and, once fully paid, the customer owns the system and the electricity is free. The service, which was launched, has around 350 customers so far in the northern state of Uttar Pradesh. Simpa uses its “SmartPanel” technology which enables remote monitoring and control of the rooftop solar panel. Customers prepay for the energy and the SmartPanel delivers power until the prepaid credits expire and the customer must then recharge. The company said the payment plan is effective as such technology would be unaffordable for most rural families. With no credit history, most are considered “unbankable” and would not be able to access loans easily, it said. Given solar television service is new and few know how to use and maintain it, the company said, Simpa has trained rural solar technicians who are responsible for installation, after sale services and monthly collection of payments.

    Cab aggregator Ola and WWF-India joined hands to support ‘Sahasra Jyoti’, a renewable energy project in the Sundarbans. The ‘Sahasra Jyoti’ initiative is aimed at bringing sustainable development to the Sundarbans by enabling energy access to 1,000 households through solar energy. The ‘Sahasra Jyoti’ project is aimed at setting up individual micro solar power stations for 15-20 hamlets in the Satjelia Island which is a forest-fringe island, sharing its boundary with the Sundarban Tiger Reserve and has an approximate population of 40,000 people.

    Not surprisingly all this capacity will contribute to India’s solar power generation capacity which is expected to nearly double to 22 GW by the end of current fiscal. India has set ambitious target of having 100 GW of solar energy and 60 GW of wind power capacities by 2022. In FY17 net capacity addition of renewable energy was higher than that of conventional energy. As India is moving towards meeting its commitments under the Paris agreement on climate change, its renewable energy market is likely to witness a strong growth over many years, the rating agency Moody’s Investors Service said. According to the rating agency, India’s emission reduction commitments under the Paris agreement will lead to a sharp rise in renewable energy capacity. India aims to achieve 40 percent of cumulative installed capacity through non-fossil fuel sources by 2030 from the current 30% and also plans to grow its renewable energy capacity to 175 GW by 2022 from the current 57 GW. It further said the rise in renewable energy capacity will bring execution challenges, including land acquisition, establishing resource quality, grid connectivity and availability. On the financing of renewable energy projects, India will need to invest close to $150 billion to meet its 2022 renewable energy targets. Since domestic banks are constrained in their lending to renewable projects, foreign capital will play an important role. However, foreign currency financing is constrained by the limited hedging products available to fully cover the rupee currency risk of purchase power agreements, it said.

    India is staying true to its ambitious renewable energy targets by showing a steady growth in renewable energy installations in India, which as of April 2017 account for 17.5 percent of the total energy source. The latest data, which is provided by the ministry of new and renewable energy, has been analyzed by Mercom Capital Group. India’s overall installed capacity has reached 329.4 GW, with renewables accounting for 57.472 GW. The figures show a significant rise on the data released by the ministry in February when the figure stood at around 50 GW. In April 2017, solar reached 3.8 percent of total installed capacity up from 2.23 percent in April 2016. Country’s coal-fired fleet remains strong with a 59 percent share in the total energy mix, although NTPC has showed itself to be the principle supporter of the government’s green energy agenda. India has set a target of reaching 170 GW of renewable energy capacity by 2022, out of which 100 GW is to come from solar. Though Niti Ayog’s draft energy policy is refreshingly forthright on the challenge of incorporating renewables it observes that rooftop solar set-ups would have become the norm by 2040. But in the immediate run-up to universal coverage of electricity, it may not be viable to tap rooftop solar for homes, according NITI Aayog’s Draft National Energy Policy. The policy notes that the share of solar and wind is expected to be 14-18 percent and 9-11 percent in electricity, and 3-5 percent and 2-3 percent in the primary commercial energy mix by 2040. However, oil and gas would have almost maintained their shares of 26 percent and 6.5 percent in 2015-16 to 25-27 percent and 8-9 percent in 2040, respectively. This will be in spite of a more than three times increase in gas consumption, owing to a large increase in total energy, the increase in gas would be less in percentage terms. While coal would have risen in absolute terms (nearly double), but in relative terms, it would have reduced its contribution from 58 percent in 2015 to 44-50 percent in 2040. The overall share of fossil fuels would have come down from 81 percent in 2012 to 78 percent by 2040. By 2040, solid biomass is expected to be replaced by liquid and gaseous fuels, and electric cooking will be a major practice across the country, according to the Niti Aayog’s vision. But 30 percent of the rural households will remain dependent on solid biomass for cooking.

    The finance ministry has rejected an ambitious ₹200 billion plan to prop up local solar equipment manufacturers with incentives and subsidies to help them withstand the flood of Chinese imports. The domestic industry is concerned about rising imports of solar equipment, which rose 38 percent to ₹ 214 billion in FY17, accounting for 90 percent of the solar cells and modules used by Indian solar developers. The MNRE began working on the policy soon after an appellate body of the WTO upheld a complaint made by the US against the ‘domestic content requirement’ component in India’s Jawaharlal Nehru National Solar Mission in September last year. The solar mission had a provision by which a part of India’s solar capacity target had to be met using locally made solar panels and modules, which the US maintained contravened three separate WTO agreements to which India was a signatory. The plan, intended to help Indian solar manufacturers’ lower their costs through various subsidies and thereby enable their products to match global prices, would have cost the exchequer ₹200 billion.

    India’s Adani Group inked a deal with East Hope Group, one of China’s largest companies, which will invest over $300 million to set up a manufacturing unit for solar power generation equipment in Gujarat. An estimated investment of more than $300 million is expected to be made by East Hope Group in India, as part of the proposed cooperation between the two conglomerates. East Hope Group, a 70 billion yuan company, is one of the largest corporate houses in China.

    Private utility Tata Power said it has completed the construction of its 187 MW Shuakhevi hydro power project in Georgia. The company, through Adjaristsqali Georgia, its joint venture with Norway’s Clean Energy Invest AS Norway and IFC InfraVentures has completed the construction of the 187 MW plant, Tata Power said in a statement. The Shuakhevi project is the largest hydropower plant to be built in Georgia over the past fifty years, and its project investment cost exceeded $420 million, it said. The project will generate about 470 GW of clean energy while lowering greenhouse gases emissions by more than 200,000 tonnes per year and the power generated by this will be exclusively sold within Georgia throughout the winter which is a period of energy deficit.

    The Union Cabinet may take up for approval this month the hydro-power policy which aims to provide about ₹167 billion support for stalled 40 hydel projects, entailing 11,639 MW capacity, and to classify all such ventures as renewable energy. Once it is approved, the distinction between large and small hydro plants would go, which would enable India to achieve clean power capacity of 225 GW by 2022. At present, a hydropower project of up to 25 MW is classified under renewable energy and is entitled to various incentives provided by the government. Projects beyond this capacity are not in this category and hence not entitled to the benefits. Out of the 30 GW installed power generation capacity, 44.59 GW comes from large hydro projects (above 25 MW) and 57.26 GW from other renewable power generation capacities. India has set an ambitious target of adding 175 GW of renewable energy capacity by 2022 which includes 100 GW of solar, 60 GW from wind, 10 GW from bio-power and 5 GW from small hydro-power (up to 25 MW capacity each). Under the policy, the government will provide interest subvention of 4 percent during construction for up to 7 years and for 3 years after the start of commercial operation to all hydropower projects above 25 MW. It is proposed that the funding for this policy would come from coal cess or national clean energy fund or non- lapsable central pool of resources for northeastern states for eight years till 2024-25. A Hydro Power Fund would be created under the power ministry for providing funds to the projects under the policy. The policy provides for Hydro Purchase Obligation for hydro projects of over 25 MW capacity. Under this, the distribution companies would be mandated to buy a proportion of power from these plants. However, this benefit would be available to those hydropower plants, which would be able to begin commercial operations after five years of notification of this policy. The policy would also mandate power ministry to engage with bankers and financial institutions for modifying lending terms and conditions for hydropower projects.  The list of purchase obligations on distribution companies may actually grow as producers and importers of natural gas want an obligation to purchase gas based power.

    The second 1,000 MW unit at the KNPP will restart generation soon, the NPCIL said. The unit was under outage due to control circuit malfunction, Power System Operation Corp Ltd said. In May only, the unit was shut down due to water and steam leakage. It was reconnected to the grid several days later. India’s atomic power plant operator, NPCIL has two 1,000 MW nuclear power plants at the KNPP built with Russian equipment. The first unit was shut down for annual maintenance and refuelling, a process that would take around two months.

    Rest of the World

    Technological breakthroughs made most of the non-fossil fuel sector internationally.  A solar-powered drone backed by Facebook that could one day provide worldwide internet access has quietly completed a test flight in Arizona after an earlier attempt ended with a crash landing. Facebook’s long-term plan for the drone, called Aquila, is to have it and others provide internet access to 4 billion people around the world who are currently in the dark.

    Scientists have developed solar-powered smart windows with tunable glazing that can control the heat and light inside a home, saving up to 40 percent in an average building’s energy costs. The system developed by researchers at Princeton University in the US features solar cells that selectively absorb near UV light, so the windows are completely self-powered, inexpensive and easy to apply to existing windows. The smart window controls the transmission of visible light and infrared heat into the building, while the new type of solar cell uses near-UV light to power the system. Since near-UV light is invisible to the human eye, the researchers set out to harness it for the electrical energy needed to activate the tinting technology.

    Scientists at Stanford University in the US have developed a device that can wirelessly charge a moving object at close range. The technology could one day be used to charge electric cars on the highway, or medical implants and cellphones as you walk nearby. According to the study, published in the journal Nature, wireless charging would address a major drawback of plug-in electric cars their limited driving range. A charge-as-you-drive system would overcome these limitations. A coil in the bottom of the vehicle could receive electricity from a series of coils connected to an electric current embedded in the road. Mid-range wireless power transfer is based on magnetic resonance coupling. The team transmitted electricity wirelessly to a moving LED light bulb but the demonstration only involved a one milliwatt charge, far less than what electric cars require. The scientists are now working on greatly increasing the amount of electricity that can be transferred, and tweaking the system to extend the transfer distance and improve efficiency.

    NASA will test a new flexible solar panel on the International Space Station, that rolls up to form a compact cylinder and may offer substantial cost savings as well as an increase in power for satellites in the future. Traditional solar panels used to power satellites can be bulky with heavy panels folded together using mechanical hinges. Smaller and lighter than traditional solar panels, the ROSA consists of a centre wing made of a flexible material containing photovoltaic cells to convert light into electricity. ROSA can be easily adapted to different sizes, including very large arrays, to provide power for a variety of future spacecraft. It also has the potential to make solar arrays more compact and lighter weight for satellite radio and television, weather forecasting, GPS and other services used on Earth. The technology conceivably could be adapted to provide solar power in remote locations. The technology of the booms has additional potential applications, such as for communications and radar antennas and other instruments. The ROSA investigation looks at how well this new type of solar panels deploys in the micro-gravity and extreme temperatures of space. The investigation also measures the array’s strength and durability and how the structure responds to spacecraft manoeuvres.

    US solar installations will fall 16 percent this year, according to a report by GTM Research and the Solar Energy Industries Association, as utilities slow procurement of projects to meet state mandates and residential systems become harder to sell. Following a banner 2016 driven by expectations that a key federal tax credit would expire at the end of that year, the utility-scale market is expected to drop to 8 GW this year from more than 10 GW last year, the report said. The utility market, which accounts for about half of all solar systems, is expected to resume growth in 2019 as utilities seek to procure projects before the 30 percent federal tax credit for solar projects begins to step down in 2020. Prices on solar systems dropped further during the first quarter, falling below $1 per watt for the first time, the report said. Residential solar is expected to rise 2 percent for the year, well below the 19 percent growth it logged last year. California is experiencing a major decline in adoption of home installations that contributed to a 17 percent first-quarter drop in the nationwide market. Large national installers that make up close to half the market, like Tesla Inc’s SolarCity and Vivint Solar Inc, have slowed growth to focus on profitability. The market for non-residential solar, which includes commercial and community solar installations, rose 30 percent in the first quarter thanks in part to a robust community solar market in Minnesota and growth in New York.

    With the Trump administration expected to publish an analysis that could undermine the US wind and solar industries, two renewable energy lobbying groups released their own study saying new energy sources pose no threat to the country’s power grid. Wind and solar advocates have said the government study’s outcome appeared to be pre-determined to favour fossil fuel industries. The new report, commissioned by the American Wind Energy Association and Advanced Energy Economy, said cheap natural gas is behind most of the decline in the numbers of US coal-fired power plants in recent years, not government subsidies that have bolstered the growth of wind and solar power. It also said there is no evidence to show that wind and solar energy are threatening the reliability of the electric grid. The groups commissioned the report shortly after Energy Secretary Rick Perry in April ordered a 60-day study of the reliability of the grid and said Obama-era policies offering incentives for the deployment of renewable energy had come at the expense of energy sources like coal and nuclear.

    Solar energy in the US alone employs more people traditional coal, gas and oil combined. The US Department of Energy report said solar power employed 3,74,000 people over the year 2015-2016, leading to 43 percent of the power sector’s workforce. Whereas, the traditional fossil fuels employed 187,117 people, making up to just 22 percent of the sector’s workforce. In 2016, employment in the solar power has increased by 25 percent, adding 73,000 new jobs to the economy, while wind energy employment witnessed an increase of 32 percent. In a period of ten years, between 2006 and 2016, the net generation from the traditional fossil fuels has declined by 53 percent, whereas, electricity generation from the natural gas increased by 33 percent, and solar by over 5,000 percent in the same period. The report suggests that 6.4 million Americans now work in the energy industry. In 2016, 300,000 new net jobs were added, which made up 14 percent of the entire job growth of the US for the year. The revelation is contrary to the ideology of the US President Donald Trump, who has just stepped out the Paris climate deal. Donald Trump’s environmental document has made no serious note of climate change or global warming.  Some experts observed that higher employment numbers could signal higher transaction costs rather than economic or energy efficiency of the sector.

    Germany raised the proportion of its power produced by renewable energy to 35 percent in the first half of 2017 from 33 percent the previous year, according to the BEE renewable energy association. Germany is aiming to phase out its nuclear power plants by 2022. Germany has been getting up to 85 percent of its electricity from renewable sources on certain sunny, windy days this year. The overall share of wind, hydro and solar power in the country’s electricity mix climbed to a record 35 percent in the first half, the BEE said. The government has pledged to move to a decarbonized economy by the middle of the century and has set a target of 80 percent renewables for gross power consumption by 2050. It aims to cut greenhouse gas emissions by 40 percent in 2020 from 1990 levels and 95 percent by 2050.

    Brazil’s government will not award new licenses for wind and solar power generation projects, despite requests from the renewable energy sector, as power markets struggle with oversupply in a sluggish economy. Brazil was one of the world’s fastest growing markets for the wind power sector in the first half of the decade with a flurry of farms appearing along the nation’s vast, windy coast. But a deep recession that began in early 2014 and from which Brazil is only now emerging brought the trend to a halt. The last licenses for new wind or solar generation projects were awarded in 2015. An auction for licenses was called off in 2016 and it is unlikely new licenses will be issued this year.

    EDF’s Flamanville 3 nuclear reactor being built in northwest France is fit for service despite weak spots in its steel, but the utility will have to replace the reactor cover by 2024 at the latest, nuclear regulator ASN said. The ASN’s provisional ruling – which will be followed by a final ruling in October after consultation of the public – is in line with recommendations in a report by its technical arm IRSN, which says Flamanville can start up safely but will need constant extra monitoring over its lifetime and will need to replace its reactor cover after a few years of operation. Following the discovery of carbon concentrations in the Areva-made base and cover of the Flamanville reactor late 2014, ASN had ordered EDF and reactor maker Areva to do extensive testing of the reactor’s steel and has reviewed the results of these tests in the first half of this year. The ASN’s green light for Flamanville, slated for start-up in late 2018, is also a European Commission precondition for approving EDF’s planned takeover of Areva’s reactor business. EDF plans to build two of the same Areva-designed European Pressurized Reactor models in Hinkley Point, Britain.

    South Korea’s oldest nuclear reactor, the 40-year-old Kori No. 1, will halt operations, becoming the country’s first nuclear plant to close permanently amid plans for a shift towards natural gas and renewables. South Korea is the world’s fifth-biggest consumer of nuclear energy, and one of few countries to export its technology, having won an order to build reactors in the United Arab Emirates. But a scandal over forged certificates for spare parts in 2012 and the 2011 Fukushima meltdown in neighbouring Japan have undermined public support for nuclear power, while the new left-leaning government aims to speed up plans to move away from both coal and nuclear. Another 11 of South Korea’s 25 reactors are set to shut down by 2030 as they reach the end of their operating lives, although some may push to have their operating licenses renewed. With the country still setting its long-term energy plans, it is unclear how many will be replaced by new reactors. Since Kori No.1 began operations on June 19, 1977, the 587 MW reactor has generated enough electricity to meet the entire country’s current demand for around 100 days, according to data from the Nuclear Safety and Security Commission. The energy ministry estimated it will take at least 15 years to fully dismantle Kori No. 1, at a cost of about $571 million. Some experts hope that shutting the reactor may help South Korea catch up to the United States, Japan and Germany in decommissioning plants. The global decommissioning market is expected to grow to about $980 billion by 2050, according to a report by the Korea Atomic Energy Research Institute.

    NATIONAL: OIL

    Fundamental shift in oil supply, demand centres with tech disruption: Oil Minister

    July 11, 2017. Oil Minister Dharmendra Pradhan has said the ex-post facto justification of movement in global oil prices has become comical and that disruptive technological innovation will impact the global oil and gas demand. He explained the fundamental change in the oil and gas demand and supply sector has taken place primarily due to the success and impact of the United States (US) shale industry and falling cost of renewables, especially solar. He said tight oil and shale gas will continue to dictate the prices of crude and natural gas in times to come and Indian refiners have already adapted to the shift in supply centres.

    Source: The Economic Times

    Petrol pump dealers defer protest against daily price revision till month-end

    July 11, 2017. Petrol pump dealers have deferred till month-end their planned ‘no-purchase, no-sale’ agitation against daily revision in fuel prices on expectations that oil companies will raise their sales commission. All India Petroleum Dealers Association, which claims to represent petrol pump operators in 23 states, had called on its members not to buy any fuel from oil companies or sell any petrol and diesel to consumers on July 12. The oil companies have promised to study the implementation of the daily price revision till August 15 to see if the dealers actually suffer any losses. Dealers said they suffer losses as they buy petrol and diesel from oil companies at one rate but the very next day rates would be cut. All India Petroleum Dealers Association said the Oil Marketing Companies (OMCs) have promised to devise some compensation scheme if the two months study (June 16 to August 15) throws out findings that dealers had suffered substantial loses due to daily price revision. Prices of petrol and diesel are revised at 0600 hrs everyday since June 16 to reflect any change in international oil price in the previous day. Previously, the revision in rate would happen on 1st and 16th of every month and was based on average international oil price and foreign exchange rate in the preceding fortnight.

    Source: The Economic Times

    India only country where energy demand will continue to rise: Oil Minister

    July 11, 2017. Oil Minister Dharmendra Pradhan said that India would be the only country for the next decade or more where the demand for energy would not subside, but continue to rise. In May, at a meeting of the Organization of the Petroleum Exporting Countries (OPEC), Pradhan had raised the issue that OPEC should work towards responsible pricing, which would allow major consuming countries to provide energy to the common people.

    Source: The Economic Times

    RIL pulls the plug on Peru oil block, trims overseas assets

    July 10, 2017. Reliance Industries Ltd (RIL) has pulled out of the last oil block it held in Peru, trimming its overseas assets to just two properties in Myanmar. RIL had in 2007 set up Reliance Exploration and Production (REP) DMCC primarily for acquiring overseas assets. It had steadily acquired 16 conventional oil and gas assets, including four in Peru, three in Yemen (one producing and two exploratory), two each in Oman, Kurdistan and Colombia and one each in East Timor and Australia. It last bagged two oil and gas exploration blocks in Myanmar in 2014. But the company slowly exited most of its international assets. In its latest annual report for 2016-17, RIL said it has “withdrawn from Block 39” in Peru. RIL held 10 percent interest in the block. Anglo-French oil and gas company Perenco held 55 percent stake in the block while PetroVietnam of Vietnam held the remaining 35 percent. RIL said it is awaiting formal assignment of its interest to the existing partners. The company now is left with just two exploration blocks in Myanmar — M17 and M18. RIL holds 96 percent stake in each of the two blocks with the remaining 4 percent being with a local company. For Block M17, the company has sought an “extension for study period” from Myanma Oil and Gas Enterprise or MOGE, the annual report said.

    Source: The Economic Times

    India to import US crude for first time, delivery in October

    July 10, 2017. India, the world’s third-largest oil importer, has sealed a first deal to import crude oil from the United States (US) and the shipment is expected to touch Indian shores in October. The deal, by state-owned Indian Oil Corp (IOC), comes within weeks of Prime Minister Narendra Modi’s visit to the US when President Donald Trump talked of his country looking to export more energy products to India. US Mars is a heavy, high-sulphur grade which will be processed at IOC’s newest refinery at Paradip in Odisha. The IOC move has already led to more purchases by other Indian refiners. Bharat Petroleum Corp Ltd (BPCL) too tendered to buy one million barrels of crude either for loading on August 16-September 5 or delivery on September 26- October 15. But for importing crude from the US, IOC had to take special permission from the shipping ministry. So, IOC obtained permission to buy the cargo on a delivered basis where the seller arranges for the ships. The cargo contracted will be delivered at Paradip refinery in the first week of October. IOC is looking at five to six grades of US crude, including Mars crude, for future purchases.

    Source: The Times of India

    Vietnam renews India oil deal in tense South China Sea

    July 6, 2017. Vietnam has extended an Indian oil concession in the South China Sea and begun drilling in another area it disputes with China in moves that could heighten tensions over who owns what in the vital maritime region. The moves come at a delicate time in Beijing’s relations with Vietnam, which claims parts of the sea, and India, which recently sent warships to monitor the Malacca Straits, through which most of China’s energy supplies and trade passes. Vietnam granted Indian oil firm ONGC Videsh a two-year extension to explore oil block 128 in a letter that arrived, the company said. Part of that block is in the U-shaped ‘nine-dash line’ which marks the vast area that China claims in the sea, a route for more than $5 trillion in trade each year in which the Philippines, Brunei, Malaysia and Taiwan also have claims.

    Source: Reuters

    ONGC, OIL better bets than downstream oil companies

    July 6, 2017. Upstream companies such as Oil and Natural Gas Corp (ONGC) and Oil India Ltd (OIL) offer better risk-reward ratio compared with downstream companies such as Bharat Petroleum Corp Ltd, Hindustan Petroleum Corp Ltd and Indian Oil Corp due to superior volume visibility and attractive valuations. ONGC has guided for strong production in gas, as new projects start by the end of 2017. Oil and gas production has been lackadaisical in the past few years. However, ONGC and OIL reported a turnaround in FY17. ONGC’s monthly hydrocarbon (oil and gas) production in the FY17 was the highest in two years. Total domestic hydrocarbon production in FY17 was 44.3 million metric tonnes (mmt) of oil equivalent, 1.8 percent higher than in the previous fiscal. ONGC expects offshore crude oil production to increase to 16.8 mmt in FY18 from 16.3 mmt in FY17. Offshore production is expected to increase from incremental crude oil production in the fields, including WO-16, B-127. ONGC has also guided for production rebound in gas to 64 million metric standard cubic meter per day (mmscmd) in FY18 as compared with 54 mmscmd, up 18.5 percent YoY. A positive policy environment may further benefit production growth. The Directorate General of Hydrocarbons is evaluating a policy for incentivising Enhanced Oil Recovery (EOR), which focuses on the implementation of various techniques for increasing the amount of crude oil that can be extracted from an oil field. Any green nod for implementation of EOR technique will be positive for the upstream companies and could potentially be a significant share of incremental volumes. Also, the expected recovery in domestic gas prices augurs well for earnings growth. According to analysts’ estimate, domestic gas price is likely to rise to $3.3 per million metric British thermal units (mmBtu) and $3.6 per mmBtu in the second half of FY18 and the first half of FY19, respectively, compared with the current $2.8 per mmBtu. The domestic gas price formula is linked to global gas prices with a lag. The burden of the subsidy of liquefied petroleum gas (LPG) and kerosene is gradually coming down due to monthly price increases. This has resulted in a drop of Rs 7,000 crore per year in the subsidy, which makes cash flows of upstream companies more predictable. The losses on kerosene and LPG may end by 2020 if crude prices remain at or below $50 per barrel. ONGC and OIL are expected to deliver 8 percent annualised earnings for the next two years. They trade at 25 percent discount to global peers based on a price-to-cash flows, higher than the historical average of 16 percent. This offers reasonable risk reward ratio.

    Source: The Economic Times

    Cabinet nod for ONGC’s HPCL acquisition likely in a few weeks

    July 6, 2017. The government is close to finalizing the structure of a deal in which Oil and Natural Gas Corp Ltd (ONGC) will acquire 51.1% stake in Hindustan Petroleum Corp Ltd (HPCL). Cabinet approval for the deal is expected in a few weeks. A proposal to integrate the two state-owned oil firms to achieve scale to compete with global companies for hydrocarbon assets in world markets was announced by Finance Minister Arun Jaitley in the 2017-18 budget. Although the merger of several oil companies was initially considered, the government finally opted for ONGC’s acquisition of HPCL, considering the need to find resources for welfare schemes. ONGC, which has announced heavy investments in its deepwater block in the Krishna Godavari basin, may have to borrow if it has to buy a majority stake in HPCL. It has cash reserves of about Rs 13,000 crore.

    Source: Livemint

    Bengaluru fuel home-delivery firm hits roadblock on PESO action

    July 5, 2017. A city-based startup which recently started a first-of-its-kind door delivery of diesel here, has hit a roadblock, after Petroleum and Explosives Safety Organisation (PESO) directed state-run Oil Marketing Companies and private retailers not to sell fuel to it, citing “safety.” In a letter to Oil Minister Dharmendra Pradhan and PESO, MyPetrolPump Chief Executive Officer Ashish Kumar Gupta has requested them to pass an interim order for certain limited quantity of delivery which would allow the firm to resume its operations on pilot basis until PESO notifies guidelines for doorstep fuel delivery businesses. Pradhan had said that the government was exploring ways to facilitate home delivery of petroleum products. ANB Fuels, under the brand MyPetrolPump, had launched its operations from June 18 with three delivery vehicles, each with a capacity of 950 litres, but had to suspend the delivery within four days of launch due to a circular issued by PESO to oil companies to stop providing fuel to it. The circular, Gupta said, has resulted in the nascent firm losing over Rs 30 lakh per month. Gupta said that the firm received 4,000 calls and 600 order requests for delivery within three days of the launch.

    Source: The Economic Times

    NATIONAL: GAS

    RIL buys CBM gas from own blocks at $7.8 per mmBtu

    July 10, 2017. Reliance Industries Ltd (RIL), which began commercial production of coal bed methane (CBM) gas from two blocks in Madhya Pradesh this March, is buying the gas for its own use at around $7.8 per million metric British thermal unit (mmBtu). The two blocks are located in Sohagpur East and West. RIL was awarded these blocks in 2001, in the first round of CBM auctions. The government had on 15 March approved pricing and marketing freedom for producers of natural gas from CBM. Following this, RIL hired Crisil in April to help in the price discovery process based on a CCEA (Cabinet Committee on Economic Affairs) approval dated 15 March. The company had been deferring CBM gas production due to lack of clarity over pricing. CBM is a natural gas stored or absorbed in coal seams and contains 90-95% methane. Other than RIL, Great Eastern Energy Corp Ltd and Essar Oil Ltd are the two existing players selling CBM gas in the market. RIL holds another CBM block in Sonhat, Chhattisgarh. Reliance Gas Pipeline Ltd, an RIL subsidiary, has laid around 312 km of pipeline to carry natural gas from Shahdol in Madhya Pradesh close to its CBM blocks to Phulpur in Uttar Pradesh.

    Source: Livemint

    ONGC Videsh to bid in Lebanon gas field auction

    July 10, 2017. ONGC Videsh Ltd, the overseas investment arm of India’s top explorer Oil and Natural Gas Corp, will bid in an upcoming auction to explore and develop gas fields off the coast of Lebanon, Indian Oil Minister Dharmendra Pradhan said. ONGC Videsh is among several companies prequalified to bid for offshore exploration and production licences from the Middle Eastern nation. The bidding process for offshore blocks 1, 4, 8, 9 and 10, three of which border Israeli waters, was postponed for years because of political paralysis in Lebanon until the formation of a new government late last year.

    Source: Reuters

    NATIONAL: COAL

    SCCL signs pact with KPCL to supply 81 lakh tons of coal

    July 11, 2017. Karnataka Power Corp Ltd (KPCL) has entered into an agreement with the Singareni Collieries Company Ltd (SCCL) for supply of 81 lakh tons coal this financial year, the company said. Under the agreement, SCCL will supply 30 lakh tons of coal to Raichur Thermal Power Station and 20 lakh tons to Yerramarru Thermal Power Station while the rest 31 lakh tons of coal to Bellary Thermal Power Station. Last year, SCCL supplied 70 lakh tonnes of coal to KPCL for its three power stations.

    Source: The Economic Times

    India in talks with Canada’s Teck Resources to buy coking coal

    July 8, 2017. India is in talks with Canada’s Teck Resources Ltd, the largest North American producer of coking coal used to make steel, for long-term purchase agreements after a cyclonic disruption in Australia cut supplies earlier this year. India has joined top buyers China and Japan to scour new markets after a powerful cyclone hit Australia that knocked out rail lines carrying coking coal to ports for export, causing a surge in prices. SAIL and Teck may explore signing a preliminary agreement. At present, SAIL meets a little over three-fourths of its needs from BHP Billiton, the world’s biggest shipper of coking coal. India needs about 56 million to 57 million tonnes of coking coal every year, of which about 85 percent is imported. According to the government’s newly-drafted National Steel Policy, India’s coking coal requirements will more than double by the fiscal year ending in 2031.

    Source: Reuters

    KPMG to ready Vision 2030 for CIL

    July 7, 2017. KPMG will chart out Vision 2030 for Coal India Ltd (CIL), which is uncertain about the future of coal and wants to diversify. The monopoly has just issued a letter of intent to KPMG, which would soon be followed by awarding of contract following which, the consultant will submit its report in 14 weeks. PwC, Delloitte India and KPMG were in the race. But KPMG was chosen for the job. In fact, KPMG has prior experience with CIL when it prepared Vision 2020 for the company a few years ago. The monopoly invited bids for vision 2030 because coal is likely to decline in India’s energy mix although it is expected to remain the mainstay for several years. According to CIL, the government believes that India does not need additional coal-fired power plants till 2027 because some 50,025 MW coal-based power plants are under construction along with some 100,000 MW renewable power capacity. According to the document inviting bids, KPMG will have to present a draft document of the Vision 2030 within eight weeks. This would be followed by two workshops — one for coal producers and another for coal consumers. It will then have to upload the draft document online for public opinion. After two additional weeks, KPMG will make a presentation to consumers along with public opinion to CIL as well as the coal ministry and then submit the final report.

    Source: The Economic Times

    Working for pollution-free coal transportation: Railway Minister

    July 6, 2017. Railway minister Suresh Prabhu said that the ministry along with Konkan Railway is keen on identifying a solution to prevent pollution while transporting coal from Mormugao Port Trust (MPT) to steel plants in the Bellary-Hospet region of Karnataka. The coal, which arrives at MPT, is transported by trucks through Vasco town, which causes a lot of dust pollution. Prabhu said that residents of Goa and India must understand that coal is required for power generation and industrial growth. Coal from MPT is typically loaded onto rail wagons and sent through southwestern railways to Hospet via Londa. Along with the expansion at the port, the single-track route is being upgraded to a double-track which has irked Vasco residents and civil society.

    Source: The Times of India

    NTPC bets $10 bn on coal power despite surplus, green concerns

    July 5, 2017. NTPC Ltd plans to invest $10 billion in new coal-fired power stations over the next five years despite the electricity regulator’s assessment that thermal plants now under construction will be able to meet demand until 2027. In the first phase, India’s biggest power producer, NTPC, plans to build three new plants with a combined capacity of more than 5 GW, nearly double the capacity of those currently being phased out. If approved, the plan could set back efforts by the world’s third-largest greenhouse gas emitter to control carbon output and raise questions about Prime Minister Narendra Modi’s vow to stand by commitments under the Paris climate accord. The proposal also comes as several coal-fired stations built in the last power boom a decade ago are standing idle due to softer-than-expected demand. Coal India Ltd is struggling to sell its stockpile as a result. More than 300 million of India’s 1.3 billion people are still not hooked up to the grid, according to NITI Aayog, which makes policy recommendations to the government. As connections improve, the panel reckons, the country’s per-capita power consumption could jump around a third to up to 2,924 kilowatt-hours by 2040 from 2012 levels. In the next decade, the around 50 GW of capacity from thermal plants due to come online by 2022 will meet demand, the Central Electricity Authority said. Around 78 percent of generated power in India at the moment still comes from coal-fired plants, however, making it one of the biggest users of the dirty and cheap fuel in the world. NTPC’s proposal is to build plants of two 660 MW units each at Singrauli in Madhya Pradesh and Talcher in Odisha.

    Source: Reuters

    NATIONAL: POWER

    India Power hopes to supply power in West Bengal’s East Midnapore

    July 11, 2017. India Power, which has been eyeing retail power distribution licences at several locations has received commitment from the West Bengal government that its application would be considered positively. India Power intends to enter into retail power distribution at industrial hubs in West Bengal’s East Midnapore and had applied for the same with the State Electricity Regulatory Commission several months ago. It has recently moved Appellate Tribunal and the application for West Midnapore has been up for public hearing a number of times although a final decision was yet to be taken. India Power distributes power to industries and domestic consumers in Asansol, Raniganj and Burdwan Paschim and now hopes to supply power in East Medinipur soon.

    Source: The Economic Times

    UPPCL signs agreements to buy 1.5 GW power for summer

    July 7, 2017. In a bid to meet the high demand during the summer months, Uttar Pradesh Power Corp Ltd (UPPCL) has signed short-term bilateral agreements with several power producers, including Tata Power, PTC, NTPC Vidyut Vitaran Nigam, JSW and Maharashtra State Electricity Board, for the month of July. Giving details of the agreements, UPPCL said approximately 1,500 MW power would be purchased in July through DEEP (discovery of efficient electricity price) e-bidding portal as well as from short-term bilateral purchases through open tenders. The DEEP portal, launched last year by Power and Coal Minister Piyush Goyal in New Delhi, provides a common e-bidding platform with e-reverse auction facility to facilitate nationwide power procurement through a wider network in order to bring uniformity and transparency in the process of power procurement. As of now, UPPCL has made arrangements to buy additional power for the month of July only, while plans are being firmed up to buy a similar quantum of power for the months of August and September too, in order to tide over the shortfall of approximately 1500 MW-1800 MW power between demand and supply. Uttar Pradesh’s average demand during peak hours goes up to 20,000 MW, while its available supply is around 1700-1800 MW. In order to fill the gap, the state often turns to bilateral power purchases as well as spot power from the exchange

    Source: The Financial Express

    India’s outdated electricity grid needs major upgrade

    July 7, 2017. India’s power grid needs to be upgraded if the plan to sharply step up power from renewable energy is to be successful, Tim Buckley, the Energy Finance Studies Director with the United States-based Institute for Energy Economics and Financial Analysis, said. Buckley, who is studying the transformation of the Indian and Chinese electricity markets, said the development and strengthening of the national electricity grid would be a critical factor in facilitating the government’s ambitious plan on renewable energy. He said the capital investment required for a transition to a smart grid was “enormous”. India’s electricity system has historically been 70 to 75 percent reliant on coal-fired power generation. Buckley said solar power generation was a near-zero marginal cost source of supply and hydro-costs varied dramatically, but were very competitive in India — particularly as a system balancing the supply for peak electricity demands.

    Source: The Economic Times

    NATIONAL: NON-FOSSIL FUELS/ CLIMATE CHANGE TRENDS

    No nuclear power for states that oppose it: Goyal

    July 11, 2017. States where governments or people oppose nuclear power projects are unlikely to get it, Power, Coal, New and Renewable Energy and Mines Minister Piyush Goyal said. Tamil Nadu will get more power from the upcoming units 3 and 4 of the nuclear power reactor in Kudankulam in Tirunelveli district of Tamil Nadu, Goyal said. In the last three years, a transmission capacity of 3,450 MW has been added and in 2020, the total transmission capacity for south India will be 18,000 MW so that states can either evacuate power to other states or get power from other states.

    Source: The Times of India

    Renewable energy’s outlook remains strong even as regulatory challenges persist: ICRA

    July 11, 2017. Buoyed by favourable policy support from the centre and the state governments, along with improving tariff competitiveness of wind and solar power, the long-term demand outlook for renewable energy in India remains strong, credit rating agency ICRA said. The improving cost competitiveness has been driven mainly by competitive bidding process and a significant fall in photovoltaics module price levels over the last three year-period for solar players, the report said. The sector, however, continues to face regulatory challenges related to Renewable Purchase Obligation norms and its compliance, continuing delays in payments from distribution utilities and risk of forced back down by the utilities in a few states, ICRA said. ICRA estimates the share of wind and solar energy capacity addition requirement to be at least 35 percent and 55 percent respectively. Solar capacity addition is likely to be higher than wind energy capacity addition in the current fiscal, ICRA said.

    Source: The Economic Times

    Luminous aims at 35 percent business from solar power in next 5 yrs

    July 11, 2017. Luminous Power Technologies is expecting solar business to contribute up to 35 percent to its overall business in next five years as the company prepares to foray into solar-based solutions for homes. Luminous Power Technologies would enter the business of solar-based solutions for residential homes in next six months. Besides, the power back-up solutions provider is also in talks with several lending companies to provide financing options of its solar-based solutions to customers, as the one-time installation cost is quite high. The company presently generates 15 percent of its revenues from the solar vertical, where it is present in the component supply segment. Luminous would also go for product enhancement and refine its solar products.

    Source: The Economic Times

    Goyal urges states to clear arrears of renewable energy companies

    July 11, 2017. The central government is persuading states to clear their arrears to renewable energy companies, which are faced with the challenge of repaying debt amid muted cash flows, Power, Coal, New and Renewable Energy and Mines Minister Piyush Goyal said The government’s thrust on clean energy enthused private players and lured big corporate houses like the Tata and Mahindra and several independent power producers into the sector. But state-run power distribution companies have been delaying payments, sometimes due to their own financial constraints but in some cases also because of their unwillingness to pay for renewable energy which is not as stable in supply as that from conventional sources, power producers said.

    Source: The Economic Times

    IOC, LanzaTech ink Rs 3.5 bn pact to build first off gas-to-bioethanol unit

    July 11, 2017. Indian Oil Corp (IOC) and LanzaTech, carbon recycling company, have signed a deal to build the world’s first refinery off gas-to-bioethanol production facility in India at an investment of Rs 350 crore. LanzaTech has developed a gas fermentation process to make fuels and chemicals. Instead of sugars and yeast, the company uses a biological catalyst to ferment waste gas emissions. LanzaTech’s technology allows refineries to divert waste gases from the grid, supporting the transition to fully renewable power, while recycling this carbon into liquid fuels and petrochemicals.

    Source: Business Standard

    Tata Steel commissions solar plant at iron ore mine

    July 10, 2017. Tata Steel has commissioned a 3 MW solar photovoltaic power plant at Noamundi. This is the first solar power plant in any iron ore mine in the country. The project, executed by Tata Power Solar, is expected to reduce CO2 emission by about 3,000 tonnes per annum. Set up at a cost of ₹ 35 crore, the initiative is aimed at addressing climate change issues and other demands on natural resources for the company’s captive use around its mining locations. Synergy between three Tata companies, namely Tata Steel, Tata Power Solar and Tata Power Trading Company, was instrumental in shaping the project.

    Source: The Hindu Business Line

    UP nudges solar power companies to cut power tariff on older pacts

    July 10, 2017. Following a steep fall in solar tariffs in the last two years, Uttar Pradesh (UP) is pressuring solar power project developers to cut rates of electricity agreed upon in earlier contracts even though the pacts were signed when equipment prices were high. Winners of an auction conducted in September 2015 have been urged to voluntarily lower power tariff of plants nearing completion. UP’s nodal agency for renewable energy New Energy Development Agency (NEDA) declared results of the auction in 2015, after which contracts were signed with 15 developers at tariffs ranging between Rs 7.02 per kilowatt hour (kWh) and Rs 8.60 per kWh. The biggest winners were Adani Green Energy which bagged a 50 MW project at a tariff of Rs 8.43 per kWh and Essel Infra Projects which also won a bid for 50 MW at a tariff of Rs 7.02 per kWh. However, they have all recently received the pro-forma of a letter the UP Electricity Regulatory Commission (UPERC) wants them to sign by which they would voluntarily agree to lower solar tariffs to Rs 7.02 per kWh, the price that was proposed by the lowest bidder during the auction. Solar tariffs have fallen drastically throughout the country due to improved technology for solar module manufacturing as well as excess production in China, from where most Indian developers source solar equipment. The lowest solar tariff reached so far has been Rs 2.44 per kWh in an auction conducted by the Solar Energy Corp of India (SECI) for the Bhadla Solar Park in Rajasthan in May. The solar tariff compares well with the price of power supplied by coal-fired plants. Bhadla has the highest solar radiation in the country. Though solar radiation in UP is weaker in comparison, tariffs have fallen there too.

    Source: The Economic Times

    Jharkhand CM unveils rooftop solar plant in Garhwa

    July 9, 2017. Jharkhand Chief Minister (CM) Raghubar Das and Madan B Lokur, Supreme Court Judge, inaugurated the Rs 1.48 crore rooftop solar power plant, at Garhwa’s civil court and sub-jail. The project was installed by Jharkhand Renewable Energy Development Agency. Das said solar power plants will be installed in all government’s buildings, Sadar Hospital and Kasturba Gandhi Balika Vidyalaya.

    Source: The Times of India

    TPDDL to set up two pilot solar microgrids in Bihar

    July 8, 2017. Tata Power Delhi Distribution Ltd (TPDDL) plans to set up two pilot solar microgrids in Bihar in partnership with the Massachusetts Institute of Technology Center for Energy and Environmental Policy Research, General Electric and Tata Trust. With this, the company is exploring a viable business model for distributed electricity generation and electrification of remote areas.

    Source: The Economic Times

    GUVNL extends deadline to bid for 1 GW renewable power

    July 8, 2017. Gujarat Urja Vikas Nigam Ltd (GUVNL) has extended the deadline for submitting bids for 1,000 MW wind and solar power supply. The decision has come after prospective bidders requested an extension in the wake of limited time period for submission of bids and the lack of clarity on GST (Goods and Services Tax) rates. GUVNL has now extended the deadline to July 24 from July 10. According to the minutes of the pre-bid meeting held on June 29, several prospective bidders raised concerns about not having adequate clarity on GST rates and limited time for submitting bids after the pre-bid conference. Many of the prospective bidders requested that the bid deadline be extended as the time allowed by GUVNL for bid submission was only 25 days while Solar Energy Corp of India (SECI) allows almost 45 days. According to revised deadlines, technical bids for both wind and solar power will be opened on July 25, while financial bids will be opened on August 1 and 2 for wind and solar power respectively. GUVNL had floated two separate tenders for procuring 500 MW each from solar and wind power projects through competitive bidding. GUVNL has invited bids to procure solar and wind power to fulfil renewable power purchase obligations (RPO) and to meet the future needs of its distribution companies. The RPO mandates that distribution company buy electricity from renewable sources for a defined minimum percentage of the total consumption of its consumers.

    Source: The Times of India

    Government to ask GST Council to cut rates for biodiesel

    July 8, 2017. The oil ministry assured the biodiesel industry that the government is keen to promote green energy and it will intervene with the GST (Goods and Services Tax) Council to ensure that the rates on biodiesel and other green energy products are reduced. The assurance from the government came here at Bioenergy Urja Utsava by Oil Minister Dharmendra Pradhan. He assured the industry that the government would make all efforts to ensure reduction of high GST rates on green fuels. Under the GST rates announced recently, biodiesel, ethanol and other mixing products would be charged at 18 percent. For the last 10 years, biodiesel attracted zero excise duty. The green fuel — biodiesel — is required by the government which wants to cut its crude import by 10 percent and more so with an environment friendly fuel. However, the high incidence of tax on biodiesel will make it costlier than diesel and ultimately make it uncompetitive, industry members pointed out.

    Source: The Indian Express

    India emerging as front-runner in fight against climate change: World Bank

    July 8, 2017. India is emerging as a front-runner in the global fight against climate change, the World Bank has said, noting that the solar power is gradually displacing coal as an energy source in the Asian country. According to the World Bank, with its conscious choice to use significantly more clean energy to fuel its growth, India is contributing to global efforts to save the planet from the effects of climate change. Just a few weeks ago, the country also walked away from plans to install nearly 14 GW of coal-fired power plants, largely because it is as affordable now to generate electricity with solar power as it is to use fossil fuels, the report said, praising the Indian move in this regard. With nearly 300 days of sunshine every year, India has among the best conditions in the world to capture and use solar energy, it noted. Noting that the Indian government is setting ambitious targets that include 160 GW of wind and solar by 2022, the World Bank said that not only will this help hundreds of million people light their homes it will also enable children to study at night, provide families with refrigerators to preserve their food or TVs to entertain themselves.

    Source: The Hindu

    Renewable energy has moved ahead of thermal power sector: India Ratings

    July 7, 2017. The recent aggressive bidding and adverse perception due to falling renewable tariffs have led to non-remunerative electricity tariffs causing a scenario of muted power demand for the private thermal power generation projects, according to research and ratings agency India Ratings which said private developers are facing more challenges in operating thermal power projects than renewable energy projects. It added strong counterparties for solar companies including Solar Energy Corp of India and NTPC Ltd are providing comfort to developers on payment security but an improvement in the financial profile of distribution utilities is important for power projects to have stable revenue receipts. The average per capita supply of electricity is lower than the national average in some states including Uttar Pradesh and Bihar. Also, with reliable and continuous supply yet to be ensured in most states, electricity demand is likely to grow across the country, driven by industrialisation. The industrial sector alone accounted for 44 percent of electricity demand nationally in 2015-16. India Ratings said in a falling electricity deficit scenario and excess energy tie-ups by distribution utilities, even amid high demand growth, projected generation capacity is well placed to meet the demand. According to the estimates of India Ratings, the amount of electricity that would have been required if all vehicles had become electric in 2016-17, will indicate the quantum of demand that can arise from the electrification of road transport.

    Source: The Economic Times

    Varanasi will be India’s first truly green city

    July 5, 2017. The government is planning to initiate a new plan to reduce the carbon footprints of Varanasi – Prime Minister Narendra Modi’s constituency. On the anvil are solar power generation plants and green energy initiatives to reduce the holy city’s dependence on fossil fuel. The move comes on the initiative of Piyush Goyal, Minister for New and Renewable Energy. Goyal had recently visited Germany and was impressed with with green energy initiatives undertaken by the European country. The ministry has now undertaken to examine the possibility of going completely green in Varanasi. The plan would be discussed in detail at a meeting in the ministry. The Centre has been keeping a close watch on implementation of urban development programmes.

    Source: The Economic Times

    Now, GVMC schools set to run on solar power

    July 5, 2017. As many as 144 schools located in the limits of Greater Visakhapatnam Municipal Corp (GVMC) will soon draw electricity from solar photovoltaic (SPV) systems mounted on their rooftops instead of the electricity supplied by Eastern Power Distribution Company of Andhra Pradesh Ltd. The proposed capacity of the SPV system is about 215 kilowatt peak and civic officials are hoping that the project will be able to fulfil their aim to power schools as part of the Smart Cities Mission. The government primary school in Pedawaltair which has a contracted load of 5 KW from the discom will get a solar panel of 5 kilowatt peak, while Madhuranagar High School with an available rooftop area of 220 square meter will get a solar panel of similar capacity. Other schools that will get solar panels include MVD High School, Prakasaraopeta High School, MVDM High School, MGM High School, GVMC Girls’ High School in Anakapalli, and PNMH School in Bheemunipatnam. GVMC said that they have recently issued a request for proposal and online submission of bids is still open. The private bidder has to carry out site survey and layout planning before installation and commissioning of the SPV system. They will also shoulder the responsibility of maintaining the systems for a period of five years. In grid-connected SPV systems, energy is fed into the building loads through a service connection. The surplus energy will be fed into the grid and shortfall will be drawn out. GVMC are expecting that the solar panels will generate surplus power and they will sell some electricity back to the discom through the grid.

    Source: The Times of India

    INTERNATIONAL: OIL

    China sets sights on oil benchmark after years of delays

    July 11, 2017. China has opened more than 6,000 trading accounts for its long-awaited crude futures contract – with three-quarters coming from individual traders – as it pushes ahead with plans to compete with global pricing benchmarks. China’s oil majors and about 150 brokerages have also registered, but the strong interest by ‘mom-and-pop’ investors looks set to mark out China’s crude futures from western counterparts, which are dominated by institutional investors. Shanghai’s crude futures are aimed at giving China more clout in pricing crude in Asia and a share of the trillions of dollars in oil futures trade. Most oil trades are priced off two crude derivatives, United States West Texas Intermediate and London’s Brent, traded on the Intercontinental Exchange and the New York Mercantile Exchange owned by CME Group. Successful crude derivatives would be the jewel in the crown in China’s push to ramp up futures trading on products from dates to steel to open up markets and offer new avenues for investors. While Chinese banks are barred from futures trading, the new market is expected to attract interest from deep-pocketed private equity firms and funds, while state-owned oil majors, like PetroChina and Sinopec will provide liquidity.

    Source: Reuters

    Unsustainable oil services demand to hit US shale boom: Halliburton

    July 11, 2017. The United States (US) shale drilling boom is likely to ease next year as demand on the industry’s service sector is unsustainable, Halliburton’s business development head Mark Richard said. The number of rigs drilling for oil in the US rose to 763, the highest in more than two years, showing that despite oil trading below $50 a barrel, shale oil explorers are still ramping up activity. Richard sees that count rising above 1,000 by the end of the year, but not beyond that. Oil services companies cut back dramatically when demand for their products fell oil prices started falling in 2014 and it has taken them longer to readjust their output. Richard said he sees 800-900 rigs as a more sustainable level in the medium term. The increase in shale activity has been a boon for companies like However, appetite for oil and gas equipment is still weak outside of the Americas, Richard said.

    Source: Reuters

    Saudi Aramco to meet Asia demand for August crude in full

    July 11, 2017. Saudi Aramco will meet the full August crude oil requirements of its customers in India and southeast Asia as well as four of its North Asian buyers. This shows how Saudi Arabia, the world’s biggest oil exporter, aims to retain market share in Asia, the region with the world’s strongest demand growth. Saudi Arabia has been cutting exports to Europe and the United States to comply with a production cut deal by the Organization of the Petroleum Exporting Countries (OPEC) and some non-OPEC countries such as Russia. At least one of the North Asian buyers will also receive full supply of Arab Heavy crude that it has requested. This marks a change from supply cuts to these buyers in the first half this year as Saudi Aramco cut output of cheaper heavy crude to meet its OPEC quota. Saudi Aramco is selling Arab Heavy crude in August at the narrowest discount in more than three years. The OPEC cuts drove up prices of Middle East heavy-sour crude, or grades with a high sulfur content, pushing Asian refiners to seek substitutes from Russia, Africa and the United States (US). India bought its first ever US crude and its refiners plan to buy more. Saudi continues to supply slightly more light oil to Japan.

    Source: Reuters

    Halcón pivots to Permian with $1.4 bn Bakken deal

    July 11, 2017. Shale oil producer Halcón Resources Corp said it would sell most of its North Dakota operations for $1.4 billion cash, part of a plan to shift its focus to Texas’ Permian Basin, the largest United States (US) oilfield. The deal with privately held Bruin E&P Partners LLC focuses Halcón on the most-active area in the US oil industry and marks a stunning turnaround for Chief Executive Officer Floyd Wilson, who formed the company in 2011 before having to usher it through bankruptcy in 2016 after oil prices plunged. The deal also highlights the ability of US shale producers to survive and reinvent themselves, despite sliding crude prices in the past two years. Houston-based Halcón will sell its operated North Dakota assets, which produce about 29,000 barrels per day (bpd). Halcón will keep its non-operated interest in wells across the state and said it may sell them in the future. After the sale, Halcón will produce about 7,500 bpd and run two drilling rigs in the Permian. By the end of the year, Halcón expects to pump about 13,000 bpd. The deal is expected to close by August. If it collapses, Halcón would pay Bruin $42 million.

    Source: Reuters

    Saudi Aramco’s Manifa oilfield production hit by technical issue

    July 11, 2017. Output from Saudi Aramco’s massive Manifa oilfield has been hit by a technical problem. Manifa is one of state-run Aramco’s biggest oilfields and latest expansions, with a production capacity of 900,000 barrels per day. Aramco brought the field online in two phases. The offshore oilfield – made of rigs on manmade islands linked by 41 km (25 miles) of causeways and bridges over the Gulf – was discovered in the 1950s.

    Source: Reuters

    OPEC figures show June oil output rise led by exempt nations

    July 11, 2017. OPEC (Organization of the Petroleum Exporting Countries) oil output has risen in June by more than 300,000 barrels per day, (bpd) according to figures the exporter group uses to monitor its supply, as a recovery in two nations exempt from a supply cut deal countered high compliance by many others. OPEC agreed to cut output by about 1.2 million bpd from Jan. 1 to reduce a glut and support prices LCOc1. Russia and 10 other non-OPEC states agreed to cut half as much. Including Nigeria and Libya, which are exempt from the deal, output by all 13 OPEC members in June rose to about 32.47 million bpd, according to the average assessments of secondary sources OPEC uses to monitor its output. OPEC is scheduled to publish the assessment of June output based on secondary sources in its monthly oil market report.

    Source: Reuters

    Statoil drills dry wells off Canada’s Newfoundland

    July 10, 2017. Norway’s Statoil and Canada’s Husky Energy have hit dry wells in a prospect in the Atlantic offshore Newfoundland for which they had high hopes, Statoil said. The companies have drilled two dry wells in the Flemish Pass geological basin, some 500 km (310 miles) off the east coast of Canada’s Newfoundland and Labrador province. The dry wells in the Flemish Pass are the latest knock for the Canadian energy industry, which is dominated by the high-cost oil sands in northern Alberta. International energy companies, including Statoil, have sold off around $23 billion in oil sands assets over the last year in favor of cheaper plays with faster returns elsewhere. Offshore Atlantic Canada production currently makes up about 200,000 barrels of Canada’s 3.85 million barrels per day output. Statoil struck oil at Bay du Nord in 2013 and the play became one of its key priorities for further exploration. The company hoped it could find enough oil and gas to develop it for production. Bay du Nord is still estimated to hold some 300 million barrels of recoverable oil and a development of that field remains under evaluation, Statoil said.

    Source: Reuters

    Mexico’s Pemex expects active farm-out season in 2018: CEO

    July 10, 2017. Mexico’s Pemex anticipates a very active “farm-out” season next year that would allow the state-run oil company to gain capital for major offshore and onshore projects, Chief Executive Officer (CEO) Jose Antonio Gonzalez Anaya said. Pemex last year formed a joint venture with Australia’s BHP Billiton to develop the $11 billion flagship Trion deepwater project in Mexico’s Gulf, the first partnership after the Latin American country opened its doors to foreign investment in a large oil reform. The company expects to take on joint venture partners for additional projects including two onshore, one in shallow water and the coveted Maximino-Nobilis deepwater area, which would be awarded before the end of this year. Estimated reserves in Maximino-Nobilis are about 503 million barrels of oil equivalent compared with 485 million barrels in Trion. It also is closer to the United States (US) border, which would make building transportation infrastructure easier, faster and cheaper, Gonzalez Anaya said. Gonzalez Anaya said that he expected the company to reach its goal of producing 1.94 million barrels per day (bpd) of crude this year and maintain or slightly increase output in 2018.

    Source: Reuters

    Iraq drills first well in Huwaiza oil field near Iranian border: Oil ministry

    July 9, 2017. Iraq started drilling the first well in the Huwaiza oil field near the Iranian border, which may contain one billion barrels in reserves, the Iraqi oil ministry said. The field is being developed by Maysan Oil Company which oversees the oil and natural gas industry in the namesake region, the ministry said in a statement. OPEC’s second largest producer, after Saudi Arabia, Iraq seeks to boost its production capacity to 5 million barrels per day (bpd) by the end of the year, from about 4.7 million bpd now. The country produces 4.3 million bpd, lower than its capacity, in line with an agreement between oil exporting countries to curb supply in order to support crude prices. Oil Minister Jabar al-Luaibi attended the well drilling launch at Huwaiza and also a ceremony marking the beginning of the expansion work in the Halfaya oil field, also in Maysan, according to the oil ministry. The expansion will double Halfaya’s capacity in 2018 to 400,000 barrels per day. The field is operated by PetroChina.

    Source: Reuters

    Japan to raise crude storage capacity for Saudi Aramco by 30 percent

    July 7, 2017. Japan said that it was preparing to raise the crude oil storage capacity that it lends for free to Saudi Aramco by 30 percent from this summer. The extra storage will help Saudi Arabia, the world’s biggest oil exporter, as it battles to keep customers in northern Asia amid a global glut and relatively low prices. In return for providing free storage, Japan gets a priority claim on the stockpiles in case of emergency. Japan is Saudi Arabia’s biggest market for crude, but oil stored at the site on the southern islands of Okinawa has also been supplied to South Korea and China. Storage available to Saudi Arabia will be increased by 1.9 million barrels to 8.2 million barrels as part of an agreement last October to extend the storage to 2019, Japanese trade ministry said.

    Source: Reuters

    Gambia to seek legal advice over African Petroleum licenses: Oil Minister

    July 6, 2017. Gambia Oil Minister Fafa Sanyang said that he planned to seek legal advice over a disagreement with Oslo-listed African Petroleum concerning the status of two off-shore exploration licenses. He also said he had no plans to meet with a representative from the company to discuss the matter.

    Source: Reuters

    Asia’s booming diesel market draws rare European cargoes

    July 5, 2017. Oil traders are shipping diesel out of Europe to Asia and the Middle East where strong demand and tighter supplies have boosted prices, in a rare arbitrage that reverses traditional routes. At least three 90,000 tonne diesel cargoes were booked in recent days out of northwest Europe options to go to Singapore and the Middle East, shipping data showed. BP chartered the long-range Nan Lin Wan and Front Antares tankers for loading out of the Amsterdam-Rotterdam-Antwerp storage and refining hub in mid-July, the data showed. Asia’s diesel refining margins have received a reprieve recently, climbing to a 2-1/2-month high this week as a buying spree from India that began in April and higher than usual regional refinery maintenance lowering supply. Imports from the Middle East and Asia, where a large number of state-of-the-art refineries have been constructed in recent years, have steadily increased to become a regular source of supply for Europe. But still, the strong Asian market in recent weeks has opened the rare arbitrage.

    Source: Reuters

    INTERNATIONAL: GAS

    Iran expects steep increase in gas output, exports

    July 11, 2017. Iran will see a steep rise in its natural gas output and exports after last year’s easing of Western sanctions, its Deputy Oil Minister Amir Hossein Zamaninia said. Zamaninia said Iran’s gas production would rise to 1 billion cubic metres a day by the end of the year from the current 800 million cubic metres (mcm) per day. Zamaninia said volumes available for export should reach 365 mcm a day by 2021, which is higher than the exports of the world’s top liquefied natural gas producer Qatar. France’s Total signed a deal earlier this month to help Iran increase gas output from the giant South Pars gas field, which the country shares with Qatar. Total will be the operator with a 50.1 percent stake, alongside China National Petroleum Corp with 30 percent and National Iranian Oil Co subsidiary Petropars with 19.9 percent. The deal marked the first by a major global energy company signed with Iran since the easing of sanctions against Tehran in January 2016.

    Source: Reuters

    Pakistan sees bigger LNG profile

    July 10, 2017. Pakistan said it could become one of the world’s top-five buyers of liquefied natural gas (LNG), with Petroleum Minister Shahid Abbasi predicting imports could jump more than fivefold as private companies build new LNG terminals. Outlining Pakistan’s ambitious plans – which, if fully implemented, could shake up the global LNG market – Abbasi said that imports could top 30 million tonnes by 2022, up from just 4.5 million tonnes currently. Cheaper than fuel oil and cleaner burning than coal, LNG suits emerging economies seeking to bridge electricity shortfalls and support growth on tight budgets. Abbasi said no one took Pakistan seriously after a decade of botched attempts to bring LNG to the country, but this has changed with the construction of new LNG terminals and gas plants. Pakistan built its first LNG terminal in 2015 and, after some delays, a second terminal is due to come online in October, doubling annual import capacity to about 9 million tonnes. A consortium of Exxon Mobil, Total, Mitsubishi, Qatar Petroleum and Norway’s Hoegh is expected to decide by September whether to build a third LNG terminal for about $700 million, Abbasi said. Pakistan has dropped plans to finance up to two more terminals, as private companies have said they would finance these themselves and use Pakistan’s existing gas network to sell directly to consumers. Abbasi said Pakistan is in talks with Russia, Indonesia, Malaysia and Oman about government-to-government deals for up to three monthly LNG cargoes for its second terminal, which can import 600 million cubic feet of gas per day, equal to six cargoes a month.

    Source: Reuters

    Oman to start processing gas from Khazzan in early September

    July 10, 2017. Oman will start operating a plant to process gas from the Khazzan gas field early September, the oil and gas ministry said. The first train has a capacity of 500 million cubic feet per day of gas, while the second train, which has a similar capacity, will be in operation in early 2018, the ministry said. BP said in November last year that the first phase of the project is more than 80 percent complete and remains on schedule to deliver first gas in late 2017, producing 1.0 billion cubic feet of gas a day. BP Oman is lead partner in the project with a 60 percent interest. Oman Oil Company Exploration & Production holds 40 percent.

    Source: Reuters

    Wood Group wins contract for Culzean gas condensate field in UK

    July 10, 2017. Wood Group has secured a new contract from Maersk to provide mechanical and management services for the hook-up and commissioning of the Culzean gas condensate field in the United Kingdom (UK) central North Sea. The three-year contract has been awarded for the project to support the new three platform, high pressure and high temperature development, which is expected to commence production in 2019. The new project is expected to provide employment to around 200 people during peak stages. The Culzean gas condensate field, which was discovered in 2008 by Maersk Oil and its co-venturers, is expected to have up to 300 million barrels of oil equivalent.

    Source: Energy Business Review

    Qatar LNG flows unaffected by crisis: Shell

    July 10, 2017. Qatari exports of liquefied natural gas (LNG) remain stable amid ongoing tension between the world’s biggest LNG exporter and its neighbours, an executive for Royal Dutch Shell said. “LNG flows remain stable, cargoes are going into the market,” Steve Hill, Executive Vice-President for Gas and Energy Marketing and Trading at Shell, said. Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut ties with Qatar, accusing it of backing terrorism.

    Source: Reuters

    Egypt sets up a new gas market regulatory authority

    July 10, 2017. The Egyptian Parliament has passed a Natural Gas Regulatory Law establishing a regulatory authority for the gas sector in order to attract more private capital in this rapidly growing sector. This new legislation and the establishment of this authority are meant to facilitate the import and distribution of gas across the country by the private sector, which is expected to take over this activity from the public sector. According to the petroleum ministry, the new regulations will be implemented by the end of September 2017. Egypt wants to position itself as a regional hub for liquefied natural gas  trade in the coming years and hopes to become self-sufficient in natural gas by the end of 2018 and a net exporter in 2020.

    Source: Enerdata

    Nigeria cabinet approves national gas policy

    July 5, 2017. Nigeria’s cabinet has approved a national gas policy that aims to reduce the country’s dependence on crude oil by increasing gas exploration and facilities, the oil ministry said. Nigeria has the world’s ninth largest proven gas reserves, at 187 trillion cubic feet. A move to using gas could reduce the drain on foreign exchange that importing refined oil products requires. If coupled with infrastructure investment, Nigeria could also improve its creaking power grid, which forces many with no power or those plagued by frequent blackouts to operate costly generators. The 100-page National Gas Policy seeks to set up a single independent petroleum regulator. It also aims to separate upstream from midstream operations and to separate gas infrastructure ownership and operations from gas trading, the oil ministry said. The policy will also divide the Nigeria Gas Company into separate transport and gas marketing companies and introduce “market-led wholesale gas pricing” after a transitional period.

    Source: Reuters

    Gazprom to start gas supplies to China via Siberia in December 2019

    July 5, 2017. Russia’s largest natural gas producer Gazprom will start supplying fuel to China through Siberia on December 20, 2019, Gazprom Chief Executive Officer Alexei Miller said, after a meeting with China National Petroleum Company (CNPC). CNPC Chairman Wang Yulin and Gazprom’s Miller met during visit to Moscow by President Xi Jinping and signed a China-Russia supplementary purchase and sale contract, the state-owned Chinese company said. The deal is the latest sign that Russia is tightening its ties with China, a major gas buyer. It comes at a time of turmoil for rival major exporter Qatar amid a dispute with its Gulf neighbours who have imposed political and economic sanctions on Doha. The new pipeline, dubbed the “Power of Siberia”, has a planned annual capacity of 38 billion cubic meters. CNPC said that it agreed to speed up the construction of pipeline and market development, as well as natural gas processing plants and domestic underground gas storage facilities to make sure the project starts on time. While the start date appears ambitious, analysts said the volume on the pipeline by the end of 2019 would likely be low and ramping up to full capacity would take some time. Miller said that natural gas consumption in China was set to reach 300 billion cubic meters annually in the next few years.

    Source: Reuters

    INTERNATIONAL: COAL

    Coal to surpass natural gas as main US power generation fuel in 2017: EIA

    July 11, 2017. The United States (US) Energy Information Administration (EIA) projected coal will briefly retake its crown from natural gas as the primary fuel for power generators in 2017 due to an increase in gas prices. Coal, however, is expected to lose that title again in 2018 as producers boost gas output and utilities to retire more coal plants for environmental and economic reasons, the EIA said. Coal lost its title to gas for the first time ever in 2016 when gas prices dropped to their lowest since 1999. Coal had been the primary fuel for US power plants for the last century. It projected coal’s share of generation would rise to 31.3 percent in 2017 before sliding to 31.2 percent in 2018. That compares with 30.4 percent in 2016.

    Source: Reuters

    Poland to generate nearly 60 percent of energy from coal in 2030

    July 11, 2017. Nearly 60 percent of Polish energy in 2030 will come from bituminous coal and lignite, Deputy Energy Minister Grzegorz Tobiszowski said. Poland, due to a lack of alternative energy sources and as trade unions retain their grip on the industry, currently generates more than 80 percent of its electricity from burning coal produced by its state-owned mines. Despite European Union requirements to cut carbon emissions, Poland has vowed to stick to coal, saying it is its only accessible source of energy and switching to others in a short time would be too costly.

    Source: Reuters

    Coal markets brace for China reaction after prices near $88.2 threshold

    July 7, 2017. Mining and electric utility executives in China are preparing for a possible government intervention into coal markets after prices hit the 600 yuan ($88.25) a ton threshold the state economic planner the National Development and Reform Commission (NDRC) said would trigger steps to cool prices. A prolonged heatwave across northern China, hydropower cuts in the south, a fresh crackdown on mine safety and imports curbs have triggered a weeks-long rally in the world’s top buyer of the fuel. In January, NDRC said in a document it is comfortable with a price of 470 yuan ($69.12) to 570 yuan ($83.82 ) per ton and will use measures to cool the market if it rises above 600 yuan. But spot physical prices offered by major producers, such as Shenhua, ChinaCoal and Shandong Energy, are already at 600 yuan, sources with the three companies said driven by strong demand.

    Source: Reuters

    Coal lines to South Africa terminal halted by violent protests

    July 6, 2017. Rail operations that transport coal to South Africa’s Richards Bay Coal Terminal (RBCT) have been halted because of violent community protests, state-run logistics group Transnet said. RBCT, which moves coal on behalf of producers and shareholders such as Exxaro and Anglo American, exported 72.6 million tonnes of coal last year.

    Source: Reuters

    Cutting China’s coal power ‘overcapacity’ can save water for 27 mn people

    July 5, 2017. Urging China to cut down on its “severe” coal power overcapacity, the report by Greenpeace East Asia said this could save enough water to meet annual needs of 27 million people in water-stressed areas. The report said that despite reduction in coal powered plants since 2014, the Chinese coal-fired capacity in areas of high water stress continues to increase. However, China’s per capita water resources amount to only one-third of the global average. According to the report, by 2020, more than 60 percent of the coal power industry’s water consumption is projected to take place in areas of high water stress. China is the world’s largest coal consumer, the report said. The report said that if the expansion goes unabated, the coal power capacity in water stressed areas is projected to jump from 437 GW in 2016 to 527 GW in 2020. Based on the report’s findings, Greenpeace urges that China reduce excess coal power capacity in high water stress areas by 179 GW before the end of the 13th Five-Year Plan period which ends in 2020. To support its West-to-East Power Transmission Project of the central government, many coal bases were developed in Central and Western China during the 12th Five-Year Plan period (2011-2015).

    Source: The Economic Times

    INTERNATIONAL: POWER

    Electricity investment overtakes oil, gas for first time ever in 2016: IEA

    July 11, 2017. Investments in electricity surpassed those in oil and gas for the first time ever in 2016 on a spending splurge on renewable energy and power grids as the fall in crude prices led to deep cuts, the International Energy Agency (IEA) said. Total energy investment fell for the second straight year by 12 percent to $1.7 trillion compared with 2015, the IEA said. Oil and gas investments plunged 26 percent to $650 billion, down by over a quarter in 2016, and electricity generation slipped 5 percent. Oil and gas investment is expected to rebound modestly by 3 percent in 2017, driven by a 53 percent upswing in US shale, and spending in Russia and the Middle East, the IEA said. The global electricity sector, however, was the largest recipient of energy investment in 2016 for the first time ever, overtaking oil, gas and coal combined, the IEA said. Electricity investment worldwide was $718 billion, lifted by higher spending in power grids which offset the fall in power generation investments.

    Source: Reuters

    Iran starts building 451 MW CCGT Khuzestan power project

    July 10, 2017. The construction of a 451 MW combined-cycle gas-fired power plant (CCGT) has started in the Andimeshk, in the Khuzestan Province of Iran. The plant consists of a gas turbine rated 307 MW and of a steam turbine rated 144 MW, supplied by Siemens, which are expected to be commissioned in 2019-2020.  The cost of the plant has been estimated at US$284 mn.

    Source: Enerdata

    Power supplies hit in Hamas-run Gaza Strip as rivals ‘stop’ payments

    July 9, 2017. Power supplies have taken a fresh hit in the Hamas-run Gaza Strip, with authorities accusing the rival Palestinian Authority of blocking fuel payments to Egypt from going through banks. The electricity distribution company confirmed only one generator was operating, producing 23 MW of power — which added to other sources means Gaza currently has a total of 93 MW a day. More than 500 MW are required to serve the Palestinian enclave’s population. The cut left the impoverished territory of more than two million people with as little as two hours of mains electricity a day. As an interim measure Egypt stepped in to deliver fuel to Gaza’s sole power plant, but that has now been threatened.

    Source: The Economic Times

    GE delivers critical equipment for 660 MW Thar Block II power plant, Pakistan

    July 5, 2017. GE has achieved a major milestone in its contract with China Machinery Engineering Corp with the delivery of critical equipment for Thar Block II power plant in Pakistan. The company has supplied equipment for boilers, including cyclones, water walls, tubes sections, soot blowers and air preheaters at the plant. The Thar II plant is expected to be commissioned in 2019, and will add 660 MW of power to the national grid. The Thar II plant, the country’s first project using Pakistani Thar lignite, is expected to help the country in achieving its goal to increase the percentage of indigenous sources of power generation to over 50% under Vision 2025.

    Source: Energy Business Review

    INTERNATIONAL: NON-FOSSIL FUELS/ CLIMATE CHANGE TRENDS

    France considers closing up to 17 nuclear power reactors by 2025

    July 11, 2017. France is planning to shut down up to 17 nuclear reactors in the next eight years to reduce the contribution of nuclear power in its energy mix. French Environment Minister Nicolas Hulot referred to the decision of French Prime Minister Edouard Philippe to persist with the previous government’s goal of reducing the contribution of nuclear power from 75% to 50% made to the country’s electricity generation.

    Source: Energy Business Review

    Kyocera Corp ventures into solar energy sector in Thailand

    July 11, 2017. Kyocera Corporation announced its plans to venture into the solar energy segment Kyocera Corporation is expanding its solar energy business in Thailand, with plans to increase sales in the country by 2.5 times during the year ending March 31, 2018 compared with the previous year.

    Source: The Economic Times

    Shell plans to spend $1 bn a year on clean energy by 2020

    July 10, 2017. Royal Dutch Shell Plc plans to spend as much as $1 billion a year on its New Energies division as the transition toward renewable power and electric cars accelerates. Shell sees opportunities in hydrogen fuel-cells, liquefied natural gas and next-generation biofuels for air travel, shipping and heavy freight — areas of transport for which batteries aren’t adequate.

    Source: Bloomberg

    Researchers surveying sea floor animals for offshore renewable energy

    July 7, 2017. There is growing interest in developing offshore wind and wave energy facilities in the Pacific Northwest. But not much is known about the sediment and animal life along the sea floor in the region. That presents a problem for renewable energy companies because they need to consider environmental implications before constructing facilities in the ocean. A team of Oregon State University researchers has helped address that problem by using a 500-pound device with jaws to grab squares of sediment from the ocean floor at eight sites off the coasts of northern California, Oregon and southern Washington.

    Source: The Economic Times

    Google to start getting Norwegian wind power by September

    July 5, 2017. Alphabet Inc’s Google unit expects to receive its first wind power from Norway by early September, the company said. Tellenes wind farm, a 50-turbine strong wind farm of 160 MW capacity that is currently under development, will become Norway’s largest wind farm and Google’s biggest in Europe.

    Source: Reuters

    Fossil fuels still make up 81 percent of the US energy consumption in 2016

    July 5, 2017. The United States (US) Energy Information Administration (EIA) reported that fossil fuels provided 81% of the total US energy consumption in 2016 despite the growing weight of renewables in the domestic energy mix. The renewable share of energy consumption reached 10.5% in 2016 and is the largest amount since the 1930s, when the amount of biomass consumption was still relatively high.

    Source: Enerdata

    Brazil to speed up adoption of biofuel mandates

    July 5, 2017. The Brazilian government will use a fast-track legislative tool to speed up implementation of a program that aims to boost biofuels use by setting mandates for fuels distributors, André Rocha, head of the National Sugar and Ethanol Council, said. Rocha said the government will issue a presidential decree to implement the program, called RenovaBio. The RenovaBio plan aims to cut carbon emissions by boosting use of biofuels, helping Brazil meet its pledge to cut heat-trapping gases under the Paris climate agreement.

    Source: Reuters

    DATA INSIGHT

    Ethanol Scenario in India

    Ethanol Supply to the Oil Marketing Companies by the sugar industry

                                                                                                                                   (in Crore Litres)

    STATECY15-16*

    CY16-17

    (till March)

    STATECY15-16*

    CY16-17

    (till March)

    Andhra Pradesh6.401.13Rajasthan0.000.00
    Bihar4.021.73Uttar Pradesh25.326.54
    Goa1.140.00West Bengal1.390.31
    Gujarat2.840.99Haryana8.630.65
    Kerala0.000.00Himachal Pradesh0.000.00
    Madhya Pradesh0.380.00Chhattisgarh0.100.00
    Tamil Nadu0.300.00Uttrakhand1.310.26
    Maharashtra28.813.80Jharkhand0.120.00
    Karnataka9.552.78Delhi7.951.80
    Odisha0.070.00Telangana9.050.38
    Punjab3.741.32All India111.1321.70

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    All India Ethanol Production & Supply to Oil Marketing Companies

    Source: Compiled from Rajya Sabha/Lok Sabha Questions

    * Ethanol supply year (1st December to 30th November of the next year)

    Publisher: Baljit Kapoor
    Editorial advisor: Lydia Powell
    Editor: Akhilesh Sati
    Content development: Vinod Kumar Tomar

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