Energy News Monitor I Volume I, Issue 34

‘Green Bonus' for Forest Cover Protection Getting bonus for being green

s per a recent media report the Union Minister for Environment & Forests has said that 'Green Bonus' for protecting forest cover is being considered by the govt. This is a novel idea to encourage the states in the Union to adequately protect the forest cover. The Himalayan states which have larger percentage of forest & tree cover in comparison to the all India level seem to consider that it is necessary for them to commercially exploit the forest wealth for higher revenue earnings since they do not think that have many other avenues.

The case of Uttarakhand is an example in this regard. The state seem to think that since it has large hydro electric potential, and not many other sources for revenue generation, it should go for full exploitation of its hydro power potential (hydel potential) basically to earn revenue for the state. Since the demand for electricity in the state is not huge, and also not expected to grow as much as in the states in plains, it's plan to have more than 100 hydel power projects in the state shall be a major source of concern. Such a plan, if implemented without due diligence, will not only lead to accelerated depletion of forest cover but also to a highly degraded bio-diversity.

The other Himalayan states also are reported to be planning a number of hydel projects with similar objective. Himachal Pradesh and Sikkim are the two other states which seem to be keen on exploiting their hydel potential on an accelerated basis. Even though some of the hydel project proposals in Sikkim are facing many hurdles because of environmental and social concerns the large number of such project proposals in these states should be of major concern from bio diversity aspect alone.

Arunachal Pradesh is another state where huge hydel potential (totaling about 50,000 MW as per CEA estimate) has been identified. Many large size hydel projects, such as ones on river basins such as Subansiri, Luhit, Dibang-Dihang, Kameng etc. are being proposed. As per 50,000 MW hydro electric initiative of CEA launched in 2003, of the 162 schemes identified for implementation in 16 different state, 42 schemes have been identified in Arunachal Pradesh alone. The deleterious impacts of these large size hydel projects on rich bio-diversity and the backward tribals of these areas, though well known for decades, are sadly ignored by the decision makers.

While the country should be appreciative of the revenue needs of these mountainous states, it should also be realized there are many alternatives for better revenue streams than by exploiting the forest wealth on an unsustainable basis such as damming the rivers. Such states, where the forest cover is high, should be provided with adequate financial and economic incentives to conserve and develop the forest wealth on a sustainable basis. Such an initiative must be designed at the national level such that it will be able to encourage even states like Karnataka, Kerala, Andhra Pradesh, Orissa, Chattisgarh, Maharastra and Goa, which do not appear to attach a lot of value to the forest wealth, to arrest the destruction of forest cover. A large number of power projects being planned in the vicinity of Western Ghats and Deccan Plateau in these states without due diligence should be a matter of serious concern.

to be continued…

Views are those of the author

Author can be contacted at [email protected]

On the Verge of Collapse, Emerges the Copenhagen Accord as a Near Obituary to Kyoto Protocol

K K Roy Chowdhury*, Energy & Environment Expert, Delhi

he world has been on the lookout for a tenable solution to the problem of Global Warming and Climate Change for a long time. Catastrophic impacts of climate change are well known by now. Findings of IPCC and other reputed organizations available on the public domain make it amply clear. If the world could not hold the rise in its temperature to 2ºC or less by 2050, our cities, species, crops and generations may be wiped out not so far from now. Science even warned us against a temperature rise of up to 6.4 degrees C this century if we do not act without any further delay. The changes are happening quicker than expected. Not so far from now in the recent past, the world had the best lesson from Tsunamis with roots in Indonesia, attacking us in an extremely unforeseen manner on 26^th December, 2004 that went past Indonesia, Sri Lanka, India and Thailand, killing two lacs of people and causing other natural disasters and losses of an unprecedented magnitude across these places. As the world was preparing to remember this exclusive catastrophic event of nature in its fifth anniversary year on 26^th December, 2009, did the world’s biggest Climate Change Conference of Copenhagen this December (2009) remember the same appropriately, with equal alacrity?

They (the Rich Nations) still appeared to be now camouflaged under the shock of recession attributed to the collapse of Lehman Brother in New York in September 2007, which in order of priority should have been placed in the second slot next to the issue of climate change that needs more urgent attention and long-term solution right now in view of the emerging grave scenario of climate change before all of us and increasing day by day. They diluted the whole issue only to weaken the UNFCCC process and the Kyoto Protocol and write its obituary! As if their homes are not affected! What a madness to sustain a lifestyle with indiscriminate consumption at the cost of the Mother Earth!

The cost of converting the world to a low-carbon economy is 1% of economic output, and to save it from economic collapse is about 5%. Thus the fact is that we can stop global warming and control climate change. The world has the money, it has the technology, and it has the talent. A concerted will of the decision makers is the need of the hour that the world failed to show in Copenhagen.

A near coup by the US-led developed countries’ Bloc (25 Rich Nations) through the Danish host at Copenhagen had a nefarious design to demand emission reductions under an international regime from emerging economies, such as India and China, while lowering their own obligations. This infuriated the G77, especially the BASIC countries –India, China, Brazil and South Africa. The Rich countries have failed to meet their commitments under the first period of Kyoto. So they now want to scuttle the Kyoto Protocol. This is despite their full knowledge of the fact that disaster looms unless they step up emission cuts, and even if current pledges are honoured, temperature will rise by 3ºC by 2050, above topping point of 2ºC , with the global emissions remaining on an unsustainable pathway beyond 2020 leading to a CO₂concentration of 550 ppm as per an authoritative assessment by the UN itself that surfaced during the Copenhagen summit. Nothing less than a legally binding international agreement with commitment for emission cut, be whatever minimum, on part of the industrialised countries could tend to reverse this. Hence the importance of the Kyoto Protocol.

to be continued…

*Views are his personal. He may be contacted at ‘[email protected]’

Note: Part V of the article on Oil & Gas Discovery & Production in India: Historical Milestones, part XIII of the article on Gas in India – Issues, Opportunities and Challenges will be published in Volume VI, Issue 35

Energy in India’s Future: Insights (part –XIX)

Jacques Lesourne and William C. Ramsay*

Continued from Volume VI, Issue No. 33…

Renewable energy and local entrepreneurship

et us now, before concluding, suggest that the two most extreme faces of the country sometimes meet. The poor, remote areas of India, for which we have largely commented the strategic need to turn toward RETs, show some progress led by a new generation of local entrepreneurs. The business model in this sector is still evolving. In fact one experiences a new class of well educated young entrepreneurs who are highly motivated. Their motivation emerges more from the level of deprivation that he/she has seen around him as part of his/her growing up instead of simply commercial considerations. The organic involvement of local community is very crucial for electrification to sustain in the long run, and the centralized grid system has lacked this property since its inception. Our field experience in the state of Bihar shows that recently local communities, after having long frustrating experience with electricity board executives, have taken over the responsibility of keeping their transformers in good condition. They collectively spend money to fix it in case any fault happens instead of approaching the Electricity Board executive responsible for that. This trend of local appropriation of daily maintenance is indeed being increasingly observed across India and across sectors. Some of the projects in this direction were awarded by the Ashden Awards⁴⁰. SELCO-India (Asden Award 2007) is a private business which has designed and sold over 48,000 solar home systems, powering electric lighting and small appliances for 220,000 people in Karnataka and other states in South India. The Aryavart Gramin bank in Uttar Pradesh (Ashden 2008) set up a bulk supply and installation agreement with TATA-BP for PV solar-home-systems, and provides loans for its customers with a good credit record to purchase the systems. To date 10,100 loans have been approved and 8,000 solar-home-systems installed. International Development Enterprises, India (IDEI) (Ashden 2006) has commercialized low-cost treadle pumps for irrigation. Over 510,000 pumps have been sold in the rural areas of the Eastern part of India, bringing substantial benefits to farming families. Small and medium enterprises (SMEs) in India rely on wood and other biomass as their primary source of energy. This is a major concern that is addressed by World Bank in its report on India’s environmental challenge (World Bank 2007). Kerala based TIDE (Ashden 2008) has developed and adapted energy-efficient woodstoves and kilns for specific industries, including arecanut processing, silk reeling, textile dyeing, ayurvedic medicine production and food preparation. Over 10,500 stoves have been sold by TIDE and the entrepreneurs it has trained: These stoves save about 43,000 tons/year biomass, provide a cleaner, cooler environment for users, and often lead to significant time savings. DESI Power,⁴¹ one of the winners of Tech Museum Award 2008,⁴² provides employment to local population in the process of building and operating renewable energy based power system mainly in the area of biomass.

Conclusion

Currently India is characterized by low per capita income, low per capita energy consumption and low energy use per unit of output. This contrasts with large urban concentrations and even large urban corridors with higher local energy intensity per capita. This leads to the cohabitation of an array of energy situations, from low efficiency, environmentally adverse, “traditional” sources to new industrial models, passing through the most usual challenges of energy rationalization any developing economy has but also through the very new urban sustainability challenges that the emerging world is hosting. Here is a case where analysis has to keep shifting from the macro to the micro levels. It is true that India, as the world’s fourth largest economy (in terms of GDP expressed in purchasing power parity) has achieved a sustained trajectory of high GDP growth: demand for energy sources, for India will definitely have a significant impact on the world energy prices and emissions. But it must be kept in mind that these absolute impacts are merely because of its high population size instead of any major inefficiency in production structure and more over Indian growth is necessary to remove poverty and deprivation. On the other hand we see that disparities during the period of high GDP growth have increased. Widening inequality, lack of inclusiveness of growth is reflected in dismal performance of India in terms HDI ranking and in absolute value of the index itself. Empirical evidence shows that countries like India can dramatically improve their HDI by small increments in their per capita energy consumption. Ensuring commercial (modern) energy supplies in aggregate does not necessarily translate into an appropriate distribution of the same to everybody. Indeed, access to these supplies is determined by complex nature of power relations existing in the Indian economy. We discussed the centrality of access to modern energy services (MES) for national and global energy and environmental sustainability. Usually lack of access to MES, in literature, is addressed as a case of energy poverty (IEA 2007, Pachauri et al. 2004). We prefer to call it poverty of MES. Indeed this poverty may exist because of either lack of energy resources themselves or because of technology. In the case of India, poverty of MES exists largely because of lack of technology that can efficiently convert the locally available biomass, wind and solar energy for final use of residents. Therefore MES poverty in India is a manifestation of another kind of poverty; i.e., of technology poverty; Here we use the term technology in a very broad sense of the term as employed by Schumpeter (1976). This definition of technology encompasses the physical conversion technology, the management techniques and institutional innovations that will enable the implementation of modern energy services.

Most of this poverty concentrates in rural areas which are abundant in biomass, solar energy and wind energy. This problem can be addressed by the following measures.

1. Cost reduction and standardization of technology through increased research and development activities.

2. Reducing the information gap through campaigns demonstrating that it is easy to understand and operate RETs. The campaign must assume the importance of a movement, such as those for fighting AIDS and for vaccination.

3. Local-level “enterprization” program. This will lead to significant reduction in transaction cost and people will no longer remain captives to “babugiri,” or the domination of Indian bureaucracy. This program also has the potential of solving the problem of unemployment among the rural youth.

In this context, it is very clear that there should be no “brown vs. green” agenda. On the contrary, poverty alleviation and development for the largest part of the population would be linked (in a two-way fashion) to energy efficiency. An inclusive growth would promote and reflect energy efficiency. Of course, at the upper end of society, the urban rationalization (of construction, transportation, energy contents in water systems, mobility, etc.) is as much a need to ensure that the higher-end growth is not too energy intensive. Since 1991, various energy sectoral reform policies have significantly changed the incentives and ownership in many subsectors and led to market development, but they are still short in delivering on inclusiveness (access) and environmental sustainability. We see that the vast and complex macro-economy of India is also quite complex in terms of energy. While in the aggregate, correlation of energy consumption and GDP growth might be quite similar to those of other economies, India’s differs extensively in details. No other nation in the world faces such a high level of deprivation in terms of modern energy services—576 million people without electricity (lighting) and 782 million without efficient cooking facilities i.e., gas and kerosene. This deprivation implies quite a low per capita income, energy consumption and energy intensity of GDP. But this should not suggest that the minority group in the country that has access to modern energy consumes any less energy or any other commodity for that matter compared to other nations. On the contrary, this small privileged minority of India is as big as the population of the United States. The contrast between what is a big economy and the mind boggling figures of deprivation for 70% of a billion-plus population, has an impact on international negotiations for environment and trade. The “per capita” figures bringing artificially down the image, this helps the privileged minority group of the country gain concessions for the whole economy. These concessions are then used exclusively by themselves to further their own economic emancipation leaving rest of country to its own fate. Providing such a large population with modern energy services will definitely have environmental consequences as coal is India’s main fuel for electricity production presently and will remain so in future. The cost of electrifying villages of India through centralized grid system is large and complex, which is seldom appreciated. We argue that if these costs are properly understood, renewable energy technologies may become a competitive option for gaining access to modern energy services in rural areas. On the other hand this will balance the higher CO₂emissions due to massive use of coal in order to meet the industrial and urban demand for energy. Such a large and heterogeneous population and complex economy like India’s needs considerable attention from the international community. We propose that diplomacy should be focused on building an internal consensus for energy efficient technological changes and increasing access to modern energy services by supporting academia, civil society organizations and business groups, whose current dynamism is another dimension that is too often underexamined.

Notes:

40. The awards were founded in 2001 by the Ashden Trust, one of the Sainsbury Family Charitable Trusts (SFCT). They awarded 80 innovative projects to develop their work in the United Kingdom and developing countries.

41. http://desipower.com/

42. The Tech Awards program that honors innovators around the world who bring improvements in the areas of education, equality, environment, health, and economic development through the use of technology.

* Editors

to be continued…

Courtesy: ENERGY IN INDIA’S FUTURE: INSIGHTS, GOUVERNANCE EUROPÉENNE ET GÉOPOLITIQUE DE L’ÉN

NEWS BRIEF

NATIONAL

OIL & GAS

Upstream

Fossil discovery in Rajasthan may boost hydrocarbon exploration

February 8, 2010. India is poised to emerge as a major source of hydrocarbon with its several prospective Neoproterozoic sedimentary basins, a top official of the Birbal Sahni Institute of Palaeobotany (BSIP) has said. Organic matter maturation studies for hydrocarbons were carried out recently by the Lucknow-based BSIP on a rich assemblage, comprising algae, acritarchs and larvae of the petroleum fly from the Gotan Limestone, Marwar subgroup in Rajasthan, revealed the micro fossil indicator Algae of Type I Liptinite.

ONGC likely to partner Hungarian major

February 8, 2010. ONGC, the country’s largest state-owned oil company, and Hungarian oil major MOL are exploring the option of jointly pursuing exploration and production opportunities in third countries. If talks fructify, the two companies could consider joint bids for a few oil and gas blocks coming up for grabs in the markets in central and eastern Europe, CIS countries and the Middle East. MOL, Hungary’s largest oil company with a considerable presence in Central Europe, the Middle East and CIS countries, is in the process of picking up a 35% stake in ONGC’s onshore exploration block in Himachal Pradesh. While the partnership is almost in place with both companies completing all formalities and the directorate general of hydrocarbons giving its nod, it is awaiting final clearance from the petroleum ministry.

Downstream

Essar Oil plans to increase petrol pumps to 2,000 soon

February 5, 2010. Essar Oil, India’s largest private fuel retailer, plans to increase its number of petrol pumps to 2,000 in the next few months from 1,450 currently. The announcement came immediately after the Kirit Parikh committee’s suggestion to free petrol and diesel pricing. Private sector oil companies — Reliance Industries (RIL), Essar Oil and Shell India — could benefit the most if the recommendation is implemented. Private oilcos have been unable to expand their retail operations because only state-run oil firms get compensated for under-recoveries. RIL had to shut its retail operations last year when global crude oil peaked at $147 a barrel. Essar and Shell India also closed some of their pumps, but when crude oil prices softened, they restarted operations. Essar currently sells petrol and diesel produced from its 280,000 barrels-per day refinery at Vadinar in Jamnagar district of Gujarat through 1,293 petrol pumps.

Implement Parikh report in full or not at all: PSU refiners

February 5, 2010. Public sector oil refiners believe that the Kirit Parikh committee's recommendations on fuel pricing should either be implemented in full or just completely ignored as has been the case with other expert panels' reports in the past. Oil marketing companies feel that greater harm is caused by marginal hikes in prices of petrol, diesel or LPG. As far as IndianOil Corporation (IOC), Hindustan Petroleum Corporation Ltd. (HPCL) and Bharat Petroleum Corporation Ltd. (BPCL) are concerned, they would be “practically wiped out” if the Centre decides to go in for a minimal price hike of petrol and diesel, while leaving kerosene and LPG (cooking gas) untouched. Even for this fiscal, the Centre still has to make good nearly Rs 200 bn losses on these two fuels to the oil majors. If this is not done, the trio will post hefty losses in the fourth quarter and, barring IOC, for the whole of 2009-10.

OIL-IOC combine launches hydrocarbon hunt in Libya

February 4, 2010. The consortium of Oil India Ltd (OIL) and IndianOil (IOC) has launched the much awaited drilling campaign in five onshore blocks in Libya in January. IOC and OIL own 50 per cent interest each in all the blocks with OIL being the operator. The consortium acquired the five exploratory blocks in Area 86 and 102 during bidding rounds in 2004 and 2005, respectively. Completion of seismic data acquisition and interpretation and plans to launch a four-well drilling programme in the contiguous blocks was announced in September-October 2009. Apart from the five blocks, OIL-IOC combine also acquired non-operating interests in four more blocks in Area 95 and 96 in 2008. Algeria's Sonatrach is the operator in these four blocks. The combine also owns exploratory rights in Gabon. Overall, OIL has exploratory interests (both operating and participatory) in 14 blocks overseas.

IOC to complete the first phase of Paradip Oil Refinery by 2012

February 3, 2010. The first phase of the much-delayed Indian Oil Corporation's [[IOC] Paradip Oil Refinery (POR) project in Orissa will be completed March, 2012 according to IOC chairperson, Sarthak Behuria. Mr Behuria said Rs 60 bn had already been invested in the project and efforts were being made to lay pipeline to Jatni, Khurda, Jharsuguda, Ranchi and Raipur for supply of petroleum products. He hinted that the IOC was facing difficulty to avail bank loans because of the absence of agreement between the state government and the public sector unit on land transfer. The chairman also stated that heavy equipments required for construction of petrochemical complex could not be mobilized due to lack of good and wide roads.

Transportation / Trade

Parikh report is bad for the country, worse for aam aadmi says expert

February 8, 2010. Surya Sethi, an energy expert had said that “Parikh’s bold oil reforms” “slipping on politics” would be good for the country and for the aam aadmi. According to him the report is bad for the country because the recommendations do not address the problems of petroleum pricing in their entirety and appear driven by the desire to allow private sector refiners, originally set up for export of products, an entry into the domestic market under the garb of liberalising prices of petrol and diesel.

RIL submits EoI to buy Canada’s oil sands co

February 6, 2010. Reliance Industries (RIL), India’s largest private sector company, has submitted an expression of interest (EoI) to acquire Canadian oil sands company Value Creation (VCI), as it looks to expand its global footprint in the oil exploration business. RIL may be willing to pay as much as $2 billion (Rs 92.5 bn), according to persons familiar with its plans. The Calgary-headquartered company’s subsidiary Technoeconomics is the owner of a technology, which helps to produce oil from sand and upgrade bitumen — a major feedstock for petroleum — at a relatively lower cost, according to oil industry experts.

RIL asks NTPC to place gas deal papers before Court

February 5, 2010. Reliance Industries has asked NTPC to place documents relating to the gas supply negotiations between the two companies before the Bombay High Court, in the case between the two companies concerning gas supply. The contract was for supply of gas to NTPC's Kawas and Gandhar plants. NTPC has sought two weeks to reply to RIL's application. In 2004, RIL won a global tender for supply of 12 mmscmd to the two NTPC plants in Gujarat. It entered into a contract with the public sector major to supply gas at $2.34 per mmbtu. As RIL failed to fulfil its contractual obligations, NTPC in 2005 filed a suit against RIL for enforcing the contract.

Policy / Performance

Parikh report: Petrol car sales may get boost

February 5, 2010. Honda, which sells only petrol cars in India, is looking forward to the implementation of the Kirit Parikh panel recommendations. This is because if the recommendations are accepted, diesel cars could become costlier by as much as Rs 1.8 lakh. The Government-appointed panel wants an additional excise duty on diesel cars, besides de-regulation of petrol and diesel fuel prices. This will push up the price of diesel cars. Currently, one of the main reasons for the high popularity of diesel cars is that the fuel is cheaper, which translates into low running costs. According to the Society of Indian Automobile Manufacturers (SIAM), carmakers with higher proportion of petrol models are likely to see a spike in sales, while those with a diesel bias may see a reverse trend.

Govt may not go for steep hike in fuel prices

February 4, 2010. A day after an expert group suggested freeing petrol and diesel prices and steep hikes in LPG and kerosene rates to combat the rising input cost, the Government hinted that it may not accept the report in totality and will protect the common man's interest. Besides, deregulating auto fuel prices, which would result in hike in petrol price by Rs 4.72 a litre and diesel by Rs 2.33 per litre, the panel also suggested raising LPG rates by Rs 100 per cylinder and kerosene by Rs 6 per litre.

ONGC's demand finds favour with fuel pricing panel

February 3, 2010. Oil and Natural Gas Corp's (ONGC) demand for a transparent system of taking away incremental revenues beyond $60 a barrel crude price for fuel subsidies has found favour with the expert group on fuel pricing. The Prime Minister-appointed panel, headed by former Planning Commission member Kirit Parikh, in its report to the government suggested adoption of ONGC model, where a Special Oil Tax (SOT) may be levied on crude oil producers if their produce fetches any price over $60 per barrel. Parikh said such a levy should be restricted only to companies which had been given oil blocks on nomination basis. Only state-owned ONGC and Oil India Ltd have been given blocks on nomination basis. According to the Parikh report, 20 per cent of the incremental price over $60 per barrel can be taken as tax to subsidise petrol, diesel, LPG and kerosene. Forty per cent of price beyond $70 per barrel can be taken as special tax, 60 per cent for any rate above USD 80 a barrel and 80 per cent on price over $90 a barrel, it said.

POWER

Generation

Torrent to add 375 MW unit at Sugen plant

February 8, 2010. The diversified Rs 55 bn Torrent group is in process of expanding capacity of its 1,147.50 mw Sugen generation plant to 1,500 mw. The company will soon decide the EPC contractor to add 375 mw unit at its combined cycle power plant. The group company Torrent Power is expected to pump in about Rs 15 bn for the proposed expansion.

Torrent Power is aiming to expand the capacity of Sugen plant by 3,000 mw in phases to create country's largest gas-based generation facility to the tune of 4,500 mw at a single location. The company has already acquired necessary land for expansion at Sugen. It may be recalled here that Torrent Power has embarked on plans to commission 10,000 mw capacity at various location with mix of fuels. Currently, it has generation capacity of 1,647.50 mw in Ahmedabad and near Surat together. Power generated from the existing capacity is being used to cater to Torrent Power's distribution areas in Ahmedabad-Gandhinagar and Surat to 20 lakh consumers.

Madhucon setting up 3 hydel plants in Uttarakhand

February 8, 2010. Madhucon Projects Ltd has been awarded three hydel power projects of 25 MW each, expandable to 100 MW, in build, operate and transfer (BOT) mode by the Uttarakhand Jal Vidyuth Nigam Ltd. The deal entails development, implementation and operation of Agastyamuni Hydel project of 25 MW in Rudraprayag district, and two other projects of 25 MW each at Tilwara, all of them located on the Mandakini, a tributary of river Alakananda. The detailed project reports for all the three units are under preparation. According to the contract, Madhucon Projects, a Hyderabad-based infrastructure company, has to operate the project for 35 years in BOT mode.

GMR bets further on power

February 6, 2010. GMR Infrastructure, the Bangalore based infrastructure developer, is betting further on the power sector in India. The company has decided to raise the capacity of its thermal power project in Kamalanga in Orissa by 33 per cent to 1,400 Mw from the earlier 1,050 Mw. GMR Infrastructure in India operates three power plants with a cumulative capacity of 800 Mw and has outlined plans to add 8 times this capacity and generate 6,700 Mw over the next five years costing around $6.5 billion. GMR is actively developing power projects with 2,000 Mw capacities in the states of Orissa and Chhattisgarh and another 1,200 Mw of hydropower projects in Uttarakhand, Himachal Pradesh, Arunachal Pradesh, and Nepal. The project cost of the unit at Kamalanga is now at close to Rs 60 bn from the earlier Rs 45 bn.

Transmission / Distribution / Trade

Areva T&D says gets 2 orders worth Rs 2.8 bn

February 8, 2010. Areva T&D Ltd said it received two orders worth Rs 2.8 billion from the Power Grid Corporation of India. The orders are for the supply and installation of 765/400 kv air insulated sub-stations for the Northern Grid-II and Northern Grid-III, the company said in a statement to the Bombay stock Exchange. The company will also provide 765 kv circuit breakers and substation automation systems as part of the project, it added.

Mormugao to boost coal handling

February 8, 2010. Mormugao port is working on projects to handle large quantities of imported coal in addition to iron ore export, which accounts for 80 per cent of the port's traffic throughput but the share is to gradually decline.

The port handles about 5 million tonnes of coal, which is targeted to rise to 15 mt by 2014. The jump in throughput should be possible because of the augmentation of coal handling capacity through initiatives being taken by the port authorities themselves as well as in association with private partner. For example, the Adanis of Mundra port will be involved in one of the coal handling berths. Iron ore, of course, will continue to be the port's mainstay – with the throughput estimated to rise to 45 mt in 2014 from 33 mt.

Bonfiglioli Transmissions to invest Rs 400 mn in TN plant

February 3, 2010. Bonfiglioli Transmissions, the 100% subsidiary of the Euro 670 million Italian Bonfiglioli Group, is betting big on the energy (yaw and pitch drives for windmills) and infrastructure (mobile products for off-highway vehicles) sectors.

The Rs 3.5 bn company, which manufactures new generation industrial power transmission products, chose Chennai over China to set up its facility in 1999, when its turnover was only Rs 6 lakh. Its total investments in this unit stands at Rs 4 bn. It plans to invest Rs 400 mn within six months that would see its current annual capacity of 1.40 lakh units go up to 2 lakh units.

Policy / Performance

Brakel, Reliance move SC on HP hydro project

February 9, 2010. Netherlands-based Brakel Corporation NV and Anil Ambani-led Reliance Infrastructure Ltd moved the Supreme Court seeking awarding of a contract for setting up hydropower projects in Himachal Pradesh. Both the companies have filed cross-appeals against the Himachal Pradesh High Court judgement that overturned the state government’s decision for allotment of the 960 mw Jangi-Thopanp-Powari hydropower project in Kinnaur district to Brakel Corp, which had emerged as the highest bidder.

The High Court while canceling the award of the project in favour of Brakel Corp had also refused the allotment to the ADAG firm. The High Court had directed the state “to take fresh decision as to whether it wants to re-advertise the said projects or it wants to act on the basis of the old tender.” Brakel was awarded the contentious project after an international bidding process in December 2006, but the terms were altered after closure of the process by converting two 480 mw projects into a single project that was challenged by Reliance Infrastructure, who had failed to win the bidding process.

Athirappilly another Silent Valley: Ramesh

February 9, 2010. Athirappilly is another Silent Valley rich in biodiversity that needs to be protected, said Jairam Ramesh, Union Minister for Environment. Mr. Ramesh said the State should look for alternative proposals for power generation, thereby indicating that clearance would not be issued for hydel projects. Incidentally, the Kerala State Electricity Board (KSEB) had proposed to set up a power project at the Athirappilly waterfalls and the move drew protests from environmentalists. Similarly, the Board’s proposal to set up a power project in the Silent Valley 25 years ago had to be shelved following stiff resistance from nature lovers and environmentalists. Mr. Ramesh said the permission issued earlier for the Athirapally project was withdrawn after he assumed the office of the Union Minister for Environment.

No proposal for thermal power plant at Mulur- Eshwarappa

February 9, 2010. President of the State unit of the Bharatiya Janata Party K.S. Eshwarappa said that no company had approached the Government for setting up a thermal power plant at Mulur, near Padubidri, in Udupi district. However, Mr. Eshwarappa said that the State needed electricity and there was no point in opposing all power projects. He claimed that the Government would not acquire land for power projects or other industrial projects by force. Union Minister for Power Sushilkumar Shinde had gone on record that all houses in the country would have access to electricity by 2012.

Govt wants ‘back-up' for Chinese power gear

February 8, 2010. Worried at the prospect of well over 35,000 MW of new power generation capacity coming up using Chinese equipment, the Prime Minister's Office has directed the Power Ministry to come up with an action plan to ensure adequate support mechanism for plant servicing and spares for these projects.

The directive, issued at a recent review meeting for the capacity addition programme, comes at a time when an estimated 21,519 MW of generation capacity is being implemented during the Eleventh Plan period using Chinese equipment while orders for another 14,000 MW have been placed for projects coming up in the Twelfth Plan (April 2012-March 2017).

Power-starved northeast India to get another 870 MW

February 8, 2010. The state-owned North Eastern Electric Power Corp (NEEPCO) will add 870 MW of power to the electricity-starved northeastern region by 2012. The corporation, which was set up in April 1976, currently has seven power stations in operation, totalling 1,130 MW, contributes around 50 percent of the region's installed capacity.

It has also signed two agreements with the Meghalaya government to execute an 85 MW hydro-electric and another 500 MW gas-based thermal power projects in East Garo Hills district. According to the NEEPCO chief, northeast India has the potential to generate about 59,000 MW of hydropower. The region also has abundant resources of coal and oil and gas for thermal power generation.

India likely to face coal shock

February 8, 2010. India could face a ‘coal shock’ sooner than later if the power utilities do not wake up to the fuel security risks from stagnating domestic production and start planning long-term coal imports to meet the fuel shortage. Although big power producers like NTPC are already meeting domestic coal shortages with imports, they have not shown any urgency to get into long-term import contracts. Meanwhile, China’s coal demand has overtaken its domestic production, forcing the world’s largest coal producer to import coal. Till 2006, China was a net exporter of coal. The global coal production in 2008 was 6.8 billion tonne while consumption stood at 6.7 billion tonne. China produced 43% of the world’s coal. So there is a clear risk that if a big coal consumer like India suddenly enters the world market, it could send international coal prices soaring. Currently, Indian power utilities importing coal use it with domestic coal in a certain mix. So there is also the risk that existing power plants could face difficulty in using a higher share of imported coal in case domestic coal supplies decline. Because of the specification issue, coal linkage for power plants is finalized keeping in mind the design of equipment.

The Planning Commission has suggested that Indian utilities import coal under long-term contracts to meet domestic coal shortages for their power plants. The commission has argued this would help port developers to upgrade their existing facilities for handling imported coal in the future. If the utilities act on the suggestion of the commission, the specification issue will also get addressed.

BHEL bags Rs 10 bn order from Bhutan

February 8, 2010. State-run BHEL said it has bagged a Rs 10 bn contract for supplying equipment to a hydro power project in Bhutan. BHEL has secured a Rs 10.16 bn contract from Punatsangchhu Hydroelectric Project Authority, Bhutan for the electro-mechanical equipment package for a 1,200 MW (6x200 MW) hydroelectric project, a company statement said. The order envisages manufacture, supply, erection and commissioning of the electro-mechanical equipment for the 1,200-MW Punatsangchhu-I Hydroelectric project, it said. The project is being set-up under a bilateral agreement between the Government of India, and the Royal Government of Bhutan.

Deal on Manipur power plant likely next month

February 7, 2010. A joint venture agreement between state-owned hydro power producers NHPC Ltd and Satluj Jal Vidyut Nigam Ltd (SJVN) and the government of Manipur to develop the Rs 81.38 bn Tipaimukh power project in the north-eastern state is likely to be signed by the end of the current financial year, ending March. In July last year, the power ministry had asked the three entities to form a joint venture (JV) for developing the project.

NHPC would hold a majority 69 per cent stake in the project, while SJVN would take up another 26 per cent stake. The remaining 5 per cent would go in favour of the Manipur government. The project was initially awarded to the state-owned utility North Eastern Electric Power Corporation Ltd (Neepco).

Small hydro projects, captive units face regulatory whammy

February 7, 2010. Small hydro projects and captive units are getting the wrong end of the regulatory stick – ironically at a time when the Government is making concerted attempts to bring on board all available generating capacities to tide over shortages.

A new set of regulations issued by the Central Electricity Regulatory Commission (CERC) stipulate that a generating station having an installed capacity of less than 250 MW will not be eligible for seeking connectivity with the inter-State transmission system, even if the developer is prepared to lay a dedicated line up to the grid pooling point. Projects that could be affected include small hydro stations, including a number of private sector plants coming up in Himachal Pradesh, Sikkim and Arunachal Pradesh, as well as most captive units having surplus power.

The Central Electricity Authority (CEA) – the statutory body looking at broad policy and operational issues in the power sector – has now stepped in and asked the CERC to amend the regulations to facilitate connectivity of these smaller generation stations to the grid.

New life for Tripura power project

February 7, 2010. Tripura’s jinxed Monarchak thermal power project, once almost shelved by Neepco, seems to have got a new lease of life with the Union ministry of power now showing keen interest in the project. Commencement of the project would depend on clearance from the Public Investment Board and Cabinet Committee on Economic Affairs.

CESC lines up 7,500 MW capacity addition

February 4, 2010. CESC, the Kolkata-based power utility, plans to invest around Rs 350 bn during the 12th Plan (2012-2018) through a combination of debt, equity and internal accruals.

The RPG group company has set a target to commission all its six thermal projects, which are at various stages of implementation across the country, by 2013. Around Rs 200 bn from the Rs 350 bn corpus will be channelled into the six projects which would give the company a generating capacity of 5,000 mw.

The balance, Rs 150 bn, would go into hydel power, which the company has just begun exploring by bagging the 140 mw Lara-Sumta hydel power project from the Himachal Pradesh government. CESC expects to have around 2,100-2,500 mw in hydel capacity by 2018.

Power-saving drive may earn stars for realty

February 3, 2010. In line with the developed world that has strict norms for energy-efficiency, India will soon implement star-rating schemes under Energy Conservation Building Code (ECBC) for all buildings that have high-energy consumption.

The Bureau of Energy Efficiency (BEE)— the nodal regulatory agency for energy conservation under the ministry of power — will issue specific ECBC star-rating norms for all existing, new residential and commercial buildings, including hotels, hospitals, malls, shopping complexes, educational institutions and IT parks with average electricity consumption of 500 kw or more.

The government has already mandated ECBC norms for state-owned buildings, and is also likely to make it mandatory for private commercial buildings and luxury residential by 2011, according to government officials.

Punjab to spend Rs 32.35 bn on power distribution system

February 3, 2010. The Punjab government has chalked out an ambitious project to the tune of Rs. 32.25 bn to strengthen the existing the power transmission and distribution (T&D) system in the state keeping in view the expected increased generation after the commencement of new thermal plants. Much needed upgradation of the entire power network system both in urban as well as in rural sectors had become mandatory in view of the 23.91% of total power loss due to the snags in the prevalent T&D system against national average of 15%.

Fitch says power sector outlook stable to negative

February 3, 2010. Fitch Ratings' outlook for the Indian power sector for 2010 remains stable to negative. On the positive side, the demand-supply balance will continue to remain tight in 2010, investor interest strong and policy and institutional support from the Government will not decline. The negative factors, including difficulties in passing power purchase costs on to end-customers, the slow progress of the State power utilities (SPUs) in reducing commercial and technical losses and the delays faced by the power sector companies in implementing an ambitious capex programme, are likely to persist in 2010. In 2009, many regulators deferred passing on cost increases (including power purchase costs) in tariffs, creating regulatory assets which will have to be remunerated through future tariff increases. Fitch anticipates that only 30 per cent of the new capacity planned during the 11th Five Year Plan will be completed in the first three years ending March 2010.

INTERNATIONAL

OIL & GAS

Upstream

Iran tankers idle in Persian Gulf as oil declines before OPEC

February 9, 2010. Iran, OPEC’s second-largest crude producer, has at least three supertankers idling in the Persian Gulf, as oil prices decline five weeks before the group’s next meeting, vessel-tracking data show. The tankers, each bigger than the Chrysler Building, have been almost stationary for at least four weeks, according to data from the ships collected by AIS Live Ltd. The depth of the 2-million-barrel vessels sitting in the water indicates they are loaded. The amount of oil stored may expand because signals from two more idled tankers shows they are partially loaded or empty.

Crude oil to rise to $75, then revisit lows: Technical analysis

February 9, 2010. Crude oil is poised to rise to $75 a barrel, before the market revisits chart support around $70, said National Australia Bank Ltd. Crude oil fell for a fourth week as concerns that Greece, Spain and Portugal may struggle to contain budget deficits drove the euro lower against the dollar, damping the investment appeal of commodities. Oil’s current “choppy phase” could favor short-term traders. Prices have moved in a $14.45-a-barrel range this year, narrower than the $49.30 band in 2009 and $114.87 in 2008.

Nord Stream says schedule intact despite Shtokman

February 8, 2010. The Nord Stream group said its initial schedule for commissioning a gas pipeline on the bed of the Baltic Sea "remains valid" despite the delay in development of Shtokman gas field, one of its resource bases. Russian gas export monopoly Gazprom said it had delayed the start of its giant Arctic Shtokman gas field by three years to 2016 after demand for its gas slumped. Nord Stream, a project involving Gazprom, Germany's BASF and E.ON as well as Dutch Gasunie, plans to transport 55 billion cubic metres of gas per year from Russia to Germany when completed in 2012.

Uganda approves Tullow purchase of two Heritage stakes

February 5, 2010. Uganda approved Tullow Oil Plc’s acquisition of stakes in two oil fields owned by former partners Heritage Oil Plc. Tullow, which exercised first refusal to buy when Heritage attempted to sell the stakes to Italy’s Eni SpA for as much as $1.5 billion, will have to allow its shares to be traded on Uganda’s stock market and make a commitment to speed up commercialization of the country’s oil reserves. China National Offshore Oil Corp. may be brought in as a partner, the WSJ said, citing an unidentified local Tullow official, adding that the proposal included construction of a refinery and a pipeline to the east African coast.

OPEC President sees stable prices as demand recovers

February 5, 2010. OPEC President Germanico Pinto said the group expects oil prices to stabilize as crude recovers from a slump in demand caused by the worst financial crisis since the Great Depression. Oil will remain between about $70 and $80 a barrel this year amid a slight increase in global consumption, Pinto, who is Ecuador’s minister of non-renewable natural resources, said. The Organization of Petroleum Exporting Countries is likely to leave output quotas unchanged when it meets next month, he said.

GE Oil & Gas chief says Iraq is challenging, boom to take time

February 4, 2010. GE Oil & Gas, the General Electric Co. unit that provides equipment to oil companies, said Iraq is a “challenging” market and there’s no prospect of a boom for suppliers for at least a year. Iraq faces technical and labor challenges to raise its oil output to its target of at least 11 million barrels a day in the next decade. A “huge” amount of equipment that GE installed in Iraq before war and sanctions stopped investment now needs upgrading. Exxon Mobil Corp., PetroChina Co., BP Plc and Royal Dutch Shell Plc, the world’s largest oil companies, have agreed to develop fields in Iraq, the holder of the world’s third-biggest crude reserves.

Global oil demand to return to growth in 2010, CNPC says

February 4, 2010. Global oil demand will return to growth this year and prices will average between $70 and $80 a barrel, China National Petroleum Corp.’s research unit said in a statement.

BP sees peak oil demand in 2020-2030

February 3, 2010. BP refining slumps to loss, margins at 15-year low BP says eyeing Brazil licensing round. Global oil demand is set to peak between 2020 and 2030, as falling developed world demand balances growing demand in emerging markets, the chief executive of Europe's largest oil company said.

OPEC reluctant to alter quota in March, El-Badri says

February 3, 2010. The Organization of Petroleum Exporting Countries is unlikely to change oil-production quotas at its meeting next month with the market as it stands, OPEC Secretary-General Abdalla el-Badri said. Prices below $70 would prevent OPEC countries from investing in new production, according to el-Badri. Members are planning 140 oil projects over the next year which will add 12 million barrels a day of capacity, he said. Compliance among the 11 OPEC members subject to the 4.2 million-barrel-a-day reduction was 57 percent in January, according to a Bloomberg survey. That’s about the same as in December.

Downstream

Saipem wins $345 mn Pemex refinery contract

February 9, 2010. Mexican state oil monopoly Petroleos Mexicanos, or Pemex, said it awarded a $345 million contract for two gasoline-desulfurizing plants to Italian firm Saipem. In a press release, Pemex said the offer from Saipem to build the plants for its refineries at Tula and Salamanca in central Mexico, was chosen over offers from Samsung and ICA-Fluor, a joint venture between Mexican construction firm Empresas ICA (ICA) and U.S. Fluor Corp. (FLR). Samsung submitted a bid of $357 million, and ICA-Fluor put in a bid $369 million, Pemex said. The three companies were invited to submit bids after a tender process for the contract was declared void in May of last year on technical grounds. All three subsequent offers met the technical requirements, Pemex said.

N.Z. Refining’s full-year margin lowest in six years

February 8, 2010. New Zealand Refining Co., operator of the nation’s only oil refinery, said 2009 processing margins fell to a six-year low as global fuel demand waned. The company charged an average $4.16 a barrel to process its customers’ crude last year, down from $9 in 2008 and the lowest annual average since 2003. Margins fell to $1.18 in November and December, from $8.88 at the start of the year, the refiner, based at Ruakaka on the country’s North Island, said in a statement.

Three consortia vie for Polish LNG project

February 5, 2010. Polish state-owned company Polskie LNG has received offers to build a liquefied natural gas, or LNG, terminal from three consortia, which include Italian, Korean and Polish builders it shortlisted last year, the company said. The groups are Italy's Saipem SpA with Poland's PBG, Italy's Tecnimont SpA with Poland's Polimex-Mostostal SA and France's Sofregaz SA, and Korea's Daewoo Engineering & Construction Co with Korea Gas Corporation. Polskie LNG will now negotiate with the bidders who will be expected to file final offers in April. The company plans to sign an agreement with the winning consortium in May. Construction will begin in the second half of this year, with the terminal set for completion by the end of the first half of 2014. The LNG terminal's capacity will be 5 billion cubic meters of natural gas a year, which may be expanded to 7.5 billion cubic meters a year. Poland currently consumes around 14 billion cubic meters a year, the company said.

BG ups capacity for Queensland LNG project

February 5, 2010. BG Group PLC said that it will expand the planned capacity at its Curtis liquefied natural gas project in Queensland, Australia, to 8.5 million metric tons a year, from 7.4 million tons a year previously. The company said it has already signed supply contracts for 8.3 million tons a year of that capacity and will make a final investment decision on the project in the middle of this year. The reserves of coal seam gas that will supply the plant now stand at 17.3 trillion cubic feet, it said.

Sinopec says China needs to revise fuel prices more frequently

February 5, 2010. China Petroleum & Chemical Corp., the nation’s largest refiner, said revising the country’s fuel prices more frequently than the current 22 days would curb speculation that leads to hoarding of gasoline and diesel. The government is considering a proposal from refiners including China Petroleum, also known as Sinopec, to review the current rule of altering gasoline and diesel prices when crude oil changes more than 4 percent over 22 days. The government may change the period or revise the formula to better reflect local fuel demand and supply.

Aramco eyes oil lubricants refinery JV expansion

February 3, 2010. Saudi Aramco Lubricating Oil Refining Co (Luberef) has invited Saudi-based companies to bid for the early engineering work to expand its Yanbu refinery, industry sources said. The Yanbu refinery has a capacity of 280,000 tpy of oil lubricants. The expansion includes a new lube hydrocracker, raising the capacity of the vacuum distillation unit (VDU), upgrading the electrical facilities and adding new storage tanks, a source familiar with the bidding process said.

Vietnam opens tender for refinery construction

February 3, 2010. Nghi Son Refinery Co. has started offering bidding documents for a package to build Vietnam's second oil refinery. The company will sign a contract with the winning bidder in the third quarter this year for the construction of Nghi Son Refinery in Thanh Hoa province, 150 kilometers south of Hanoi. The plant, with a planned throughout capacity of more than 10 million metric tons of crude oil a year, or 200,000 barrels a day, is scheduled to start production from late 2013. It will be the second oil refinery in Vietnam, after the 130,000-barrel-a-day Dung Quat refinery in the central province of Quang Ngai.

Transportation / Trade

ExxonMobil taps Praxair for enhanced oil recovery in Texas

February 8, 2010. Praxair has signed a contract with ExxonMobil to build, own and operate an air separation unit (ASU) to supply additional nitrogen for enhanced oil recovery (EOR) operations at ExxonMobil's Hawkins, Texas gas processing plant site. Under the new contract, Praxair will install a new production facility to meet ExxonMobil’s requirements for nitrogen. Operations from the new supply network are scheduled for start-up in the second half of 2011. Praxair will produce 85 million cubic feet per day of high-pressure nitrogen and additional quantities of liquid argon.

EMG, Israel Electric Corp. finalize $6 bn gas sale agreement

February 8, 2010. Ampal-American Israel Corporation has been advised by East Mediterranean Gas Co. ("EMG"), in which Ampal has a 12.5% interest, that Israel Electric Corporation ("IEC") has received all of the required approvals for the coming into force of a certain Amendment to the Gas Sale Agreement signed by EMG and IEC on September 17, 2009. The total contracted gas supply to IEC is approximately 42 BCM and the total value of the contract is approximately $6 billion.

Labor shortage may increase Australian LNG costs, Fitch says

February 8, 2010. An emerging skills shortage may increase costs and cause delays for companies developing liquefied natural gas projects in Australia, Fitch Ratings said. Ventures in Western Australia proposed by oil and gas producers including Chevron Corp. and Woodside Petroleum Ltd. and companies in Queensland planning to convert gas extracted from coal seams into LNG may need 60,000 workers at the peak of construction, Fitch said. Santos Ltd., BG Group Plc, Exxon Mobil Corp., Oil Search Ltd., ConocoPhillips and Origin Energy Ltd. are among other companies moving ahead with LNG plans in Australia or Papua New Guinea.

Eni offers to sell stakes in three international gas pipelines

February 4, 2010. Italian energy giant Eni SpA (E) said it offered to sell its stakes in three international natural gas pipelines, which it values at total of around EUR1.5 billion, in a move aimed at ending a European investigation into market abuse. Eni was facing a potential fine of more than EUR1 billion after allegations that it blocked competition on the Italian gas market by hoarding capacity its international pipeline network and deliberately underspent on upgrades despite strong demand by other gas distributors.

Stena, partner buy Samsung, Daewoo tankers for Brazil

February 4, 2010. Stena Bulk AB, a Swedish shipping company, said it has ordered four tankers from Samsung Heavy Industries Co. for $268 million to ship crude from Brazil, home of the Americas’ biggest oil discovery in three decades. Two of Stena’s tanker orders from Samsung were previously announced Jan. 12.

Enbridge adds Statoil as shipper on oil sands pipeline system

February 3, 2010. Enbridge Inc announced an agreement with Statoil Canada Ltd. for the addition of the company's Leismer oil sands project as a shipper on Enbridge's Regional Oil Sands System. This brings the number of producing oil sands projects connecting to Enbridge's regional system to six. The Leismer project is situated in close proximity to the Waupisoo Pipeline, one of two large diameter pipelines comprising Enbridge's Regional Oil Sands system which delivers oil sands crude to the mainline hubs at Edmonton and Hardisty. Total production from the four Statoil project leases is expected to eventually reach 220,000 barrels per day of bitumen.

Bulgaria ratifies Nabucco pipeline deal

February 3, 2010. Bulgarian legislators unanimously backed the agreement to take part in a EU-backed gas pipeline project that aims to reduce Western dependency on Russian energy supplies. Nabucco, the 3,300-kilometer pipeline via Turkey and the Balkans, is planned to circumvent Russian influence and begin delivering gas from Caspian fields to Europe in 2014. The 10-billion-dollar project gained additional interest after the gas crisis in early 2009, when Russia turned off the supply to Europe amid a row with Ukraine over transit fees. The gas crisis created huge problems in many countries that dependent, such as Bulgaria, on Russian gas for heating and industry. Russia meanwhile is developing its own new big pipeline project, the South Stream, which competes with Nabucco.

Policy / Performance

Pertamina to settle Bontang shipment carryover

February 9, 2010. The Indonesian government through state oil and gas company PT Pertamina will ship 80 cargoes worth US$2 billion of liquefied natural gas (LNG) in carryover to Japanese buyers. The 80 cargoes constitute an accumulation of shortages in LNG exports under long-term contracts from the Bontang LNG plant of Pertamina in East Kalimantan. The shipment to the western buyers in Japan is not based on a new contract. There is a legal contract that has to be met by Pertamina and it could not be seen as a new contract. The government has said it would extend LNG contracts only after domestic gas requirement is fully met.

Browse JV selects location to process LNG

February 9, 2010. Woodside advises that the Browse Joint Venture has selected the Western Australian Government's Browse LNG Precinct at James Price Point, 60km north of Broome, as the location to process gas from the venture's Browse Basin gas fields. This decision satisfies a condition of retention leases WA-28-R, WA-29-R, WA-30-R, WA-31-R, WA-32-R, TR/5 and R 2 to select a development concept within 120 days, effective December 2, 2009.

PSA investigates gas leak at Norway's Mongstad

February 9, 2010. The Petroleum Safety Authority Norway has initiated an investigation into a gas leak which took place at Mongstad in western Norway on February 8. This escape of liquefied petroleum gas (LPG) occurred while modification work was under way. Nobody was injured, but the area was cordoned off and personnel evacuated. The area of the complex where the leak happened was shut down and depressurized.

Iraqi Oil Minister: Kurdish oil exports to resume soon

February 9, 2010. Oil exports from northern Iraq's semi-autonomous Kurdish region will resume "in the near future," Iraqi Oil Minister Hussein al-Shahristani said. Exports from northern Iraq's Kurdish region had halted following a dispute between Baghdad and the Kurdish Regional Government (KRG) over the KRG's contracts with foreign companies to export the oil. The Iraqi government said that these agreements had been signed illegally, "without the knowledge of the federal government."

China becomes oil ETF’s no. 4 holder, buys SPDR Gold Trust

February 9, 2010. China Investment Corp., the nation’s sovereign wealth fund, joined Goldman Sachs Group and Morgan Stanley & Co. in investing in the U.S. Oil Fund, an exchange- traded crude-futures fund. China Investment became the fourth-largest holder in the Oil Fund by buying 2 million shares, equal to 3.48 percent of the outstanding units, with a value of $78.6 million, according to a Securities and Exchange Commission 13-F filing posted on Feb. 5. It also took a 1.45 million share stake, or 0.4 percent of the total, in the SPDR Gold Trust worth $155.6 million.

BP shareholders protest Canadian oil sands project

February 8, 2010. BP Plc shareholders put a resolution to the annual meeting on April 15 for a review of the risks of the company’s Canadian oil sands project, following a similar protest against competitor Royal Dutch Shell Plc. A coalition of investors requested the review in a resolution to BP’s annual meeting, FairPensions, the campaign’s coordinator, said. The risks include increased carbon costs and reputational damage from environmental damage, according to London-based FairPensions, which represents unions, charities and faith groups.

Iran discovers oil, gas fields - Ministry

February 8, 2010. Iran has discovered an oil field and a gas field, the Oil Ministry's news agency said. The gas field, called Halegan and located in the Fars province, has the capacity to yield 50 million cubic meters of gas a day for 20 years. The Halegan development has the potential to generate more than $80 billion in revenue for the country at current prices. The Somar oil field, in the province of Kermanshah, has oil-in-place reserves estimated at 475 million barrels, 70 million of which could be recovered.

Singapore LNG awards Samsung EPC contract for terminal

February 8, 2010. The Singapore LNG Corporation Pte Ltd (SLNG) has awarded the contract for the engineering, procurement and construction (EPC) of Singapore's LNG terminal to Samsung C&T Corp. The total budget for the terminal funded by the Singapore Government is S$1.5 billion, of which about S$1 billion is for the EPC contract. SLNG, which owns and oversees the development of the terminal, will issue a "Notice to Proceed" to Samsung to start the detailed design, engineering and construction phases of the terminal immediately. The LNG terminal is expected to be Asia's first open-access, multi-user terminal. The terminal will not only provide capacity for Singapore to import regasified LNG for its own needs, but also open up opportunities for companies to make use of the terminal for LNG trading.

Indonesian govt owes Japanese buyers $2 bn worth of LNG

February 8, 2010. The Indonesian government through PT Badak Natural Gas Liquefaction (NGL) owes Japanese buyers US $2 billion worth of liquefied natural gas (LNG). The debt is an accumulation of shortages in LNG exports under long term contracts from the Bontang LNG plant by the subsidiary of Pertamina, the state oil and gas company. If NGL failed to ship the shortages totalling 80 cargoes, the government has to pay around US $2 billion in compensation. The fact become a factor to be considered to renew LNG export contracts to Japan.

Rosneft's total proved reserves up 2.5 pc

February 8, 2010. Rosneft announced the results of the annual independent audit of its hydrocarbon reserves performed by DeGolyer & MacNaughton. According to the audit results, as of December 31, 2009, Rosneft had estimated net proved reserves of 22,858 mln boe, which include 18,058 mln bbl (2,483 mln tonnes) of oil and 28,801 bcf (816 bcm) of gas under the PRMS classification. In 2009, proved hydrocarbon reserves grew 2.5% over 2008, with oil reserves increasing by 2.1% and gas reserves increasing by 4.0%. The reserve replacement ratio was 163%, including 146% for oil. Rosneft's hydrocarbon reserve life was 26 years, 23 years -- for oil and 66 years -- for gas.

Indonesia to Import 600,000 barrels of Oil from Sudan

February 8, 2010. Indonesian state-owned oil company PT Pertamina said it had obtained a permit from the trade minister to import 600,000 barrels of "Nile Blend" crude from Sudan. Oil production in Indonesia has decreased steadily during the last decade, owing to disappointing exploration efforts and declining production at Indonesia's large, mature oil fields. In 2008, Sudan exported the majority of its oil to China (214,000 bbl/d) followed by Japan (102,000 bbl/d) and Indonesia (43,000 bbl/d). Additional importers of Sudanese crude include India, South Korea, Taiwan, Thailand and Malaysia.

China may replace India in IPI project

February 7, 2010. China may replace India in the proposed IPI gas pipeline project as New Delhi has been dithering over the deal, a media report has said. China might replace India in the proposed project soon as India has been dithering over the deal. All the details between Pakistan and Iran in this regard have already been finalised, according to the report.

Eni presents gas pipelines proposal to EU Commission

February 4, 2010. Eni has formally presented to the Directorate General for Competition of the European Commission a set of structural remedies related to some international gas pipelines. With prior agreement from its partners, Eni has committed to dispose of its interests in both the German Tenp gas pipeline and in Switzerland's Transitgas pipeline. Given the strategic importance of the Austrian Tag pipeline, which transports gas from Russia to Italy, Eni has negotiated a solution with the Commission which calls for the transfer of its stake into an entity controlled by the Italian State.

Azerbaijan promises 'energy security' with new pipeline

February 4, 2010. President Ilham Aliyev of petrocarbon-rich Azerbaijan promised to help western Europe improve its energy security. He spoke in Berlin just before talks with German Chancellor Angela Merkel at her office. Both said they would be talking about the Nabucco pipeline. Construction is scheduled to begin next year of the 3,300-kilometre gas line to cross Turkey all the way to Austria. Azerbaijan is a major producer of oil and gas. The new route would allow Azerbaijan's gas to reach the west and bypass the Russian pipeline system. The project has been criticized by Moscow.

Dubai discovers new oil field in Persian Gulf

February 4, 2010. Dubai announced the discovery of a new offshore oil field in the Persian Gulf that could boost its economy at a time when the United Arab Emirates' second-largest sheikhdom is struggling with a multibillion-dollar debt pile. The media office of Dubai's ruler Sheik Mohammed bin Rashid Al Maktoum announced the discovery of the new oil field offshore Dubai but didn't provide any details on its size. The discovery is located east of Dubai's existing offshore Rashid field, according to the statement.

BP to lose $1.6 bn in unit outside oil and gas

February 3, 2010. BP Plc, Europe’s biggest oil company, expects to lose about $1.6 billion this year in the division including solar energy, shipping and other operations outside oil and gas. In 2010, BP expects the quarterly loss, excluding non-operating items, for alternative energy and shipping and some other businesses to average around $400 million. The company’s adjusted loss from businesses outside of oil and gas production, refining and marketing widened to $2.3 billion last year, from $1.2 billion in 2008, “primarily due to a weaker margin environment for shipping and our BP solar business and adverse foreign exchange effects,” it said in a statement.

POWER

Generation

Huadian Power to build new coal-fired power plant in Laizhou

February 9, 2010. Huadian Power International Corp, China's largest independent power producer, announced that it has obtained approval from the National Development and Reform Commission to build a coal-fired power plant in Laizhou, Shandong Province. The company said in a statement that it will invest a total of RMB 7.1 billion in the planned plant, which will be installed with two home-grown 1,000 MW generators. Twenty percent of the total investment will come from the working capital, while the remaining will be from bank loans, said Huadian Power. Huadian Power said late last month that it expected to report profit for last year, due to a decline in coal price last year and a price hike of electricity, In 2008, the power producer booked a net loss of RMB 2.56 billion under Chinese accounting standards, according to an earlier report from China Knowledge.

Abengoa said to raise $460 mn for Pemex plant in Mexico

February 9, 2010. Abengoa SA, the Spanish engineering and recycling company, is borrowing $460 million to build a power plant in Mexico for oil company Petroleos Mexicanos. Banobras, a lender for infrastructure projects, is underwriting the 6½-year financing. Banobras and Pemex, as the oil company is known, both are owned by Mexico’s government.

Egypt to build its first nuclear power plant

February 8, 2010. Egypt will build its first nuclear power plant in the Mediterranean coastal town of El-Dabaa, reviving the country's civilian nuclear power program after more than two decades. Egyptian authorities announced in 2007 plans to build nuclear power facilities in the country to meet the increasing demand for electricity. The north African state's nuclear program was originally suspended after the Chernobyl disaster in the former Soviet Union in 1986.

East Kalimantan to build seven new power plants

February 8,, 2010. East Kalimantan will build seven power plants starting this year. The power plants built to overcome an energy crisis are located in Karang Joang (30 MW), Kariangau (200 MW), Gunung Bayan (50 MW), Embalut (100 MW), Bakrie Power Sangata (200 MW), Senipah (80) and Berau (20 MW). The power plants’ construction, he continued, are the result of cooperation between the East Kalimantan Provincial Government, the East Kalimantan branch of state power firm PLN and private companies.

5 dead, 12 injured in US power plant blast

February 8, 2010. Rescuers hunted for survivors or more dead in the rubble of a US power plant after a massive gas explosion tore it apart and killed at least five workers. Terrorism had been ruled out, according to the mayor, who said the accident, which broke the windows of nearby residential buildings and shook houses miles (kilometers) away, happened during a testing procedure.

Huge hydroelectric dam approved in Brazil's Amazon

February 3, 2010. Brazil granted an environmental license for the construction of a controversial hydroelectric dam in the heart of the Amazon rainforest. The $17 billion project on the Xingu River in the northern state of Para will help the fast-growing Latin American country cope with soaring demand for electricity but has raised concern about its impact on the environment and native Indians

Transmission / Distribution / Trade

S.Korea KOSPO to import 13 mn tonnes coal in 2010

February 9, 2010. Korea Southern Power Co Ltd (KOSPO) said it will import 13 million tonnes of coal this year, 500,000 tonnes more than last year, because of higher operations at a new power plant completed last summer. The utility said in a statement that it planned to lift coal imports to 21 million tonnes in 2015, when it is scheduled to complete another power plant.

Coal-to-gas switch ‘would lift power prices 20 pc'

February 8, 2010. Electricity prices would rise 20 per cent if power suppliers switched from brown coal to cleaner gas-fired generators, says TRUenergy. TRUenergy owns and operates the Yallourn coal-fired power station in Victoria's Latrobe Valley and gas-fired power stations elsewhere. TRUenergy envisaged a move from combustion techniques in the Latrobe Valley to new, clean gas-fired technology over the next 10 to 20 years. Replacing coal-fired power units at Yallourn with gas-fired units would cost $2 billion to $2.5 billion.

Policy / Performance

FG, gas producers meet over power generation slump in Nigeria

February 9, 2010. In a bid to arrest the slump in the country's power generation, the federal government yesterday met with chief executives of oil and gas companies in Abuja to see how to resolve the gas supply crisis which has led to the shutting down of power generation facilities of the Power Holding Company of Nigeria and a fall in the national generating capacity from 3,700mw to 2,700mw.

Venezuela’s Chavez declares ‘emergency’ on electricity crisis

February 9, 2010. Venezuelan President Hugo Chavez declared a national “emergency” in the electricity sector as the country’s worst drought in 50 years dries up water supplies in hydroelectric dams. The government has ordered rolling blackouts throughout the South American country to prevent a collapse of the power grid. Chavez retracted a plan to conserve electricity in Caracas and fired his electricity minister after traffic lights were left without power. A new plan is being drafted. The Guri dam, which holds the water used to generate two-thirds of the country’s power, is 46 percent full, down from 60 percent at the start of the year, according to the National Administration Center, which operates the power grid.

PLN to call tenders for 10 GW plants starting March

February 9, 2010. State power utility PT Perusahaan Listrik Negara (PLN) will begin to call tenders for the construction of the country`s second 10,000 megawatts power projects in March. In the first phase, PLN will call tenders for the construction of small-scale steam power plants outside Java. Tenders will later be called for the construction of steam power plants in Java and geothermal power plants in a number of areas in the country, he said.

Nigeria approves hydro power plant

February 8, 2010. The Nigerian government has approved a multi-billion hydro electricity dam project in Kubau Local Government Area of Kaduna State. The approval of the power generation comes barely a week after Nigeria’s power utility company shut down four power plants due to gas shortages in the country. Nigeria, which has been experiencing power outages in some parts of the country, may get worse as gas shortages plague the power production firm in the country.

Iran's Bushehr nuclear power plant "one test away from operation"

February 8, 2010. Head of the Atomic Energy Organization of Iran (AEOI) Ali Akbar Salehi said the country's first nuclear power plant in the southern city of Bushehr is only one test away from operationy. Bushehr (plant) has passed an array of tests in the last few months, and the Metal Core Test has been the latest test accomplished, said Salehi. Last month, AEOI announced that the country's first nuclear power plant in Bushehr will come on stream by this autumn. The country's 1,000-megawatt nuclear power plant was originally constructed in the mid-1970s by Siemens of Germany, but was abandoned with the outbreak of the country's 1979 Islamic Revolution.

UK, India near accord on civil nuclear cooperation

February 5, 2010. Britain and India have reached an outline agreement on nuclear energy cooperation and are looking at expanding ties in defence manufacturing, British Business Secretary Peter Mandelson said. Mandelson said the agreement was ready to be signed soon. Britain was a market leader in the sector, with UK-based industry earning 700 million pounds ($1.11 billion) in overseas business each year and employing 80,000 people, she said.

Renewable Energy / Climate Change Trends

National

Gamesa corp starts India operations with first facility near Chennai

February 9, 2010. Gamesa Corporation, Spain, ranked among the three main wind turbine manufacturers in the world, is betting big on India both in the manufacture of wind turbines (for domestic and export markets) as well as in developing wind farms on its own.

The Indian subsidiary, Gamesa Wind turbines based in Chennai has set up a state of the facility, the first one in India, at Red Hills near the city to produce cost effective G 58\850 kw wind turbines suited specially for the Indian grid and wind conditions. Gamesa India has already started wind research activities along with power evacuation facilities for developing wind farm sites to meet its business plans.

The company has signed up contracts in India and Sri Lanka for installation of more than 60 mw. Each machine of 850 kw will cost Rs 6 to 6.5 crore for installation on a turn key basis.

Shyam Saran inaugurates Hindi seminar on climate change

February 8, 2010. Special Envoy to Prime Minister on Climate Change Shyam Saran inaugurated the 18th Hindi Scientific Seminar on 'Impact of climate Change on Society' organised by Ministry of Earth Sciences here.

Elaborating the importance of the theme, he said the entire mankind has been experiencing the changes taking place in climate and stressed the need of creating awareness about it. A book compiled on the organization of a seminar held on January 27, entitled 'Jalvauu Parivartan' was also launched.

Haryana looks at biogas plants to boost green energy use

February 8, 2010. The Haryana government has formulated a Rs 850 mn project for setting up 50,000 family-size biogas plants to harness the potential of generating biogas for cooking and organic manure in the fields.

These biogas plants would be set up by the financial institutions with their own investment through clean development mechanism (CDM) within three years. The cost of the plants will be recovered from the farmers through one-time down payment.

Haryana Renewable Energy Development Agency (Hareda) had invited Expression of Interest (EoI) from financial institutions and other companies that have the capabilities to undertake the project of 50,000 family-size biogas plants having capacity of two, three, four and six cubic metre. The companies could also collaborate with other reputed agencies to enhance their professional and technical capabilities and capacities, he added.

Need for precise info on climate change, says Saran

February 8, 2010. Against the backdrop of an IPCC report making a wrong conclusion about Himalayan glaciers melting, Prime Minister's Special Envoy on Climate Change Shyam Saran harped on more research to generate precise information on the matter. Saran's views assume significance in the wake of a report of the intergovernmental panel on climate change (IPCC) wrongly concluding that the glaciers in the Himalayas will disappear by 2035 due to global warming.

IPCC chief R K Pachauri has admitted that the mistake cropped up due to a "human error". Saran, however, defended Pachauri and said he should not step down from his post.

Govt expects 3.5 pc power from renewable sources this fiscal

February 7, 2010. The Ministry of New and Renewable Energy expects 3.3 – 3.5 per cent of electricity to come from renewable sources during the current fiscal. 3.5 per cent was less than the aspiration target of five per cent renewable energy purchase for financial year 2009-10 set by the National Action Plan of Climate Change (NAPCC). To be able to sustain the current level of electricity generation (which is in the range of 3.5 per cent) from the renewable sources is not an easy task.

The country's overall installed electricity generation capacity including renewable was 1.56 lakh megawatt as on December 31, 2009. Plant load factor (PLF) – operational efficiency – of renewable energy sources is lower than conventional energy, thus making it more difficult to achieve the target.

As on December 31, 2009, cumulative generation from grid-interactive renewable power and off grid/distributed renewable power was 16,052.87 MW.

Green energy policy brings no joy to producers

February 4, 2010. The renewable energy policy, which was released in December last year and reached the producers last month, has left them disappointed.

The various renewable energy producers associations have strongly reacted against the policy calling it ‘grossly inadequate’, while the energy department says the producers should be ‘happy’ about such a forward looking policy. “Despite repeated representations that clearly stated the main requirement of the renewable energy policy, what has come out is grossly inadequate and disappointing, say representatives of Indian Wind Power Association (IWPA).

The much hyped single-window- clearance system also failed to meet the expectations of the producers. In its present form, it is just a just a review body headed by the Chief Secretary; the producers will still have to go through all the departments to get the project approval.

South holds potential for biomass: TEDA official

February 3, 2010. Southern districts of Tamil Nadu have immense potential to make use of biomass to generate power on a large scale. The raw material for biomass gasifier plants is available in abundance in the south, especially in Ramanathapuram district, according to Tamil Nadu Energy Development Agency (TEDA) Deputy General Manager of Madurai Region, S.E.S. Syed Ahamed.

The Madurai Region of TEDA covers 16 districts of south and central Tamil Nadu. An 11 KW biogasifier unit installed at Bharathiar Community Centre in Tuticorin district in the last week of December for irrigation and lighting purposes has been functioning successfully. The plant was designed and installed by Ankur Scientific Energy Technology of Vadodara in Gujarat. Of the total cost of Rs. 4.5 lakh, a sum of Rs. 1.65 lakh was provided in central financial assistance from the Union Ministry of New and Renewable Energy under the ‘Western Ghats Development Programme’ with the funds routed through TEDA.

Global

Element Power acquires 1.4 GW in wind assets from EcoEnergy

February 9, 2010. Element Power announced that it picked up a 1.4 gigawatt portfolio of U.S.-based wind development assets from EcoEnergy for an undisclosed price. The acquisition is part of Portland-based Element Power’s strategy to build its North American portfolio. Element now has nearly 4 gigawatts in wind and solar assets in more than 25 states. Element also has operating and development-stage wind and solar assets in Europe and South America.

US Federal Climate Service created to provide data

February 9, 2010. The National Oceanic and Atmospheric Administration will create a new climate change office to gather and provide data to governments, industry and academia as part of a broad federal effort to prepare for long-term changes to the planet, officials said Monday.

The new unit, to be known as the NOAA Climate Service, will assemble the roughly 550 scientists and analysts already working on the issue at the agency into a cohesive group under a single leader.

China plans three Westinghouse nuclear plants

February 8, 2010. China has finished initial design work on its first three inland nuclear power plants, all of which will use technology developed by Westinghouse, a unit of Japan's Toshiba. The three projects, using Westinghouse's third-generation AP1000 technology, will meet all requirements for construction to start this year. The projects are at Taohuajiang in Hunan province, Xianning in Hubei province, and Pengze in Jiangxi province.

All of China's existing nuclear projects are on the coast. Future inland projects will also use AP1000 technology, SNPTC said. Westinghouse and U.S. engineering firm Shaw Group Inc are already building four AP1000 reactors at two sites in Shandong and Zhejiang provinces.

PetroChina request for emission credits Questioned by UN board

February 8, 2010. A United Nations board that regulates the second-biggest carbon market will review PetroChina Co.’s request to be given credits for cutting emissions at a plant that had higher-than-forecast production.

The UN’s Clean Development Mechanism executive board will study potential “incompetence,” according to the UN Framework Convention on Climate Change that didn’t say who may be at fault.

Britain launches labeling for green power tariffs

February 8, 2010. Britain has launched a scheme to certify and label electricity produced by green means so as to help consumers and small businesses choose tariffs to support suppliers doing more to cut carbon emissions than obliged.

Britain's energy regulator OFGEM said green energy suppliers needed to show an independent panel they were carrying out an additional activity to source for more renewable electricity and to reduce household carbon emissions.

Riding green wave, Philips says "let there be LED"

February 8, 2010. More than a century into its existence, Philips is once again betting heavily on semiconductors. The producer of one in four of the world's lights, which sold its semiconductor business in 2006 after it was undercut by Asian rivals, has invested more than 4 billion euros ($5.47 billion) to ride the clean-tech wave and defend its world-leading position.

The company is betting on a shift in the lighting market, away from inefficient incandescent light bulbs and toward light-emitting diodes or LEDs -- perhaps best known for their use in the flashing indicators found on most consumer devices.

Nuclear giant Areva buys solar company Ausra

February 8, 2010. The world's largest nuclear plant builder, Areva SA, is diversifying into solar power with the aim of becoming an industry leader, as it acquires U.S.-based solar thermal player Ausra, the company said on Monday.

Financial details were not disclosed in the purchase of Ausra, a Silicon Valley company which had raised $130 million in venture capital from high-profile firms including Kleiner Perkins and Khosla Ventures.

The purchase marks Areva's first foray into solar energy. Areva chose solar thermal technology -- which uses the sun's heat to create steam to run turbines for electricity -- over other solar power options because it is "the closest" to nuclear plants.

Power gets deals for 15 mid-size solar fields

February 7, 2010. Israeli solar energy developer Arava Power said it signed long-term contracts with 15 agricultural cooperatives to build mid-size solar fields at an investment of 2 billion shekels ($533 million).

The fields will produce a total of 100 megawatts of solar energy using photovoltaics, for an average of 6.5 megawatts per field. Arava said it is advancing rooftop solar installations on cowsheds and factories in the signatory cooperatives.

Smart" power key as EU sparks electric car debate

February 7, 2010. Electric cars must be backed by "smart" power networks if they are to help the world's climate problems, environmentalists warned as European ministers prepared to debate a strategy for the sector.

Industry ministers will meet in San Sebastian, Spain to discuss how to realign power infrastructure, equipment standards and the marketplace so that European carmakers can race ahead of rivals in Japan, China and the United States.

The European Union has succeeded in cutting the link between economic growth and rising carbon emissions, but has failed to control the transport sector where output of carbon dioxide has soared by 38 percent over the last 20 years, EU data has shown.

Ahmadinejad asks Iran agency to enrich uranium to 20 pc

February 7, 2010. Iranian President Mahmoud Ahmadinejad asked his country’s Atomic Energy Organization to start enriching uranium to 20 percent, the level needed to power its Tehran research reactor.

Ahmadinejad also said his country is still willing to negotiate a deal with Western powers to send low-enriched uranium abroad and have it refined into nuclear fuel.

Wind power boom continues despite global meltdown

February 5, 2010. World’s wind power capacity achieved 31% growth in 2009 adding 37.5 GW to bring total installations up to 157.9 GW, a global wind energy body said on Wednesday.

The global wind energy council (GWEC) has announced that the world’s wind power capacity grew 31% in 2009, adding 37.5 GW to bring total installations up to 157.9 GW. The main markets driving this significant growth continue to be Asia, North America and Europe, each of which installed more than 10 GW of new wind capacity in 2009. While China added over 13 GW, India installed 1.27 GW.

DOE releases $20.5 mn for community renewable energy projects

February 5, 2010. U.S. Department of Energy Secretary Steven Chu announced the selection of five projects to receive a combined US $20.5 million from the American Recovery and Reinvestment Act to support deployment of community-based renewable energy projects including biomass, wind and solar installations. DOE estimates that these projects will provide enough clean, renewable energy to displace the emissions of approximately 10,700 homes.

RWE, cutting CO₂output, to sell stake in coal plant

February 5, 2010. RWE AG plans to sell a stake in a coal-fired power plant valued at as much as 80 million euros ($110 million) as Germany’s second-largest utility seeks to lower carbon emissions. The utility plans to sell its 24.6 percent holding in the 508-megawatt power station in Rostock. A stake that size in a 16-year-old coal plant such as Rostock may fetch as much as 80 million euros, according to WestLB AG analyst Peter Wirtz. The Rostock plant generates about a third of the power used in the state of Mecklenburg-Western Pomerania in northeast Germany. Vattenfall AB and EnBW Energie Baden-Wuerttemberg AG are also co-owners of the facility, which burns hard coal.

Taiwan demands China Steel cut emissions, buy credits

February 5, 2010. Taiwan is forcing some of its largest companies including China Steel Corp. to cut emissions in return for permission to expand on the island, where greenhouse-gas output per capita is almost three times the world average. The biggest polluters must either slash gas discharges, invest in emissions-reduction projects or buy carbon credits in global markets. Taiwan’s government is negotiating with companies while pushing them to compete with European and Japanese buyers in the $120 billion global carbon market. The policy is a stopgap until permanent emission limits are set under the Greenhouse Gas Reduction Act being debated in the legislature.

Nuclear renaissance could stall, Canada group says

February 4, 2010. Expectations of a sharp rise in nuclear generating capacity over the next two decades are likely overblown, a Canadian think tank said, disputing conventional wisdom that a nuclear renaissance is in full swing. In a report based on a 3-1/2 year study of the nuclear industry, Ontario-based Center for International Governance Innovation said new reactor construction will be held back by a series of economic, security, and waste disposal issues. Despite claims in the industry that nuclear capacity is expanding, there have actually been very few new reactors started in recent years, and that nuclear energy as a percentage of global energy production has actually retreated since 2001. Standing in the way of new construction are costs that can run up to $10 billion per new reactor, competition from other, cheaper, energy sources, the problem of safely disposing of nuclear waste, and concern about the spread of nuclear weapons, the report said.

WEA puts 2 MW Gamesa turbine in commercial operation in Iowa

February 4, 2010. Wind Energy America (WEA) announced that it has completed the commissioning of the first of two Gamesa G-87 2-megawatt (MW) wind turbines. The turbines make up the company's wholly-owned Zachary Ridge community wind project, located on Buffalo Ridge in Osceola County, Iowa.

Suntech exec sees excess solar supply coming to U.S.

February 4, 2010. Planned cuts to Germany's solar power incentives will probably prompt solar companies to ship excess panels to the United States, pressuring equipment prices here, a top U.S. executive for China's Suntech Power Holdings said on Thursday. Germany is the top market for photovoltaic solar systems, with about 50 percent of the global market, but the government there is planning to cut prices paid for solar power from roof-mounted systems by 15 percent from April 1.

U.S. led climate pact can´t replace global consensus, UN says

February 4, 2010. The United Nations climate chief rebutted attacks on UN-sponsored science reports and defended its role in leading global treaty talks after a U.S.-led group of countries negotiated a parallel accord in Copenhagen.

Yvo De Boer, executive secretary of the UN Framework Convention on Climate Change, said he supports the Copenhagen Accord provided it helps talks among 193 nations to agree on a global climate-protection treaty.

The UN climate chief is pushing to keep talks from splintering after U.S. President Barack Obama and leaders from some of the worst polluting nations stepped in to write a last- minute agreement in December that has won formal endorsement from only about 55 nations since it was concluded Dec. 19.

EDF chief questions cooperation with GDF

February 4, 2010. The new head of EDF Henri Proglio is sceptical of the electricity company's cooperation with Gaz de France in gas and electricity distribution. Although the two companies are bitter rivals they cooperate to offer services such as meter reading in houses and response to emergencies like blackouts and gas leaks.

The system has been in effect in one form or another since 1945. However, untangling the partnership could be sticky. Under the programme, both EDF and GDF have created subsidiaries called ERDF and GrDF which employ some 45,000 people.

EPA sets 2010 U.S. renewable fuel standard

February 4, 2010. The U.S. Environmental Protection Agency said that ethanol and other renewable fuels must account for 8.25 percent of total gasoline and diesel sales in 2010 to meet Congress' mandate that nearly 13 billion gallons (49.2 billion liters) of renewable fuels be produced this year.

That is lower than last year's 10.21 percent renewable fuel standard that the EPA announced in November 2008. These rules are separate from the amount of ethanol the EPA now allows to be blended into each gallon of gasoline, which is in most cases 10 percent.

IEA says U.S. must adopt carbon pricing system

February 3, 2010. The United States must adopt a carbon pricing system, like the one President Barack Obama has submitted to Congress, if it hopes to meet its U.N. commitments on greenhouse gas emissions, the International Energy Agency's head said. Nobuo Tanaka, executive director of the Paris-based IEA which advises 28 industrialized nations on their energy policy, said Washington's 2020 target of cutting carbon emissions by 17 percent from 2005 levels meant it would have to adopt new legislation imposing a cost on carbon waste.

Poet CEO says U.S, cellulosic rule "prudent"

February 3, 2010. The chief executive of Poet, the top U.S. ethanol maker, said companies are committed to producing next generation cellulosic ethanol even though the U.S. government has slashed mandates on how much of the fuel will be required to be produced this year.

The Environmental Protection Agency chopped the amount of cellulosic required to be blended into gasoline this year from 100 million gallons (378.5 million liters) to 6.5 million gallons.

Ofgem proposes ‘far-reaching’ steps to secure energy

February 3, 2010. U.K. energy regulator Ofgem proposed “far-reaching” measures to protect energy supplies after the recession curbed funds for utilities to invest in new capacity. Britain needs to ensure it has sufficient energy supplies as it prepares to shut as much as 30 percent of its power- station capacity within the next decade. Aging plants will be replaced in part by generators running on natural gas, a fuel in decline in the country’s North Sea reserves.

Obama eyes biofuels, clean coal in new climate push

February 3, 2010. President Barack Obama laid out new steps to nudge the United States toward energy independence, backing measures to boost production of biofuels and bury pollution from coal. Using the new initiatives to garner support for a climate and energy bill stalled in the U.S. Senate, Obama met with a handful of state governors to press his policies to fight global warming and wean the nation from imported fossil fuels.

Online fraudsters steal carbon permits -registry

February 3, 2010. Online fraudsters have targeted international carbon markets to steal emissions permits from companies and sell them illegally, officials said. Account holders at emissions registries were hit by a "phishing" scam when emails were sent to market participants requesting their details, an official at German registry DEHSt said. In the $135 billion global carbon market, which includes the European Union's Emissions Trading Scheme, companies can buy permits from others to emit greenhouse gases when cutting those emissions is too expensive.

Goldman forecasts China to lift 2020 wind-power capacity by 50 pc

February 3, 2010. Goldman Sachs Group Inc. forecast China will raise its 2020 target for wind-power capacity by 50 percent and named China High Speed Transmission Equipment Group Co. as its top pick among Chinese power equipment makers. Goldman Sachs favors China High Speed for its “direct exposure to policy-induced growth in wind power,” according to a research report. The brokerage estimated the Chinese government will more than double its target for nuclear power capacity in 2020, they wrote. Dongfang Electric Corp., through its growing positions in wind and nuclear power, is well positioned for long-term power market, the analysts wrote.

Extra carbon-capture financing gets approval from EU countries

February 3, 2010. European Union nations approved rules to finance carbon-capture and storage projects using allowances under the bloc’s emissions-trading system, clearing the way for billions of euros in extra subsidies to fight climate change. The maximum 300 million EU carbon-dioxide emission allowances set aside for the technology as well as for renewable energy as of 2013 will be sold by the European Investment Bank and distributed to member states for project support.

U.S. not on target to meet biofuels output goal: panel

February 3, 2010. The United States is not on target to meet a Congressional mandate to produce 36 billion gallons of biofuels a year by 2022 or produce 100 million gallons of cellulosic ethanol a year by 2010, a government inter-agency panel said.

South Korea forecasts 52 pc gain in alternative energy spending

February 3, 2010. South Korea, Asia’s fourth-largest crude importer, forecast that investments in alternative energy will increase by 52 percent in 2010 because of expansion in solar and wind power. Spending by the private sector and state-run companies may rise to 5.5 trillion won ($4.8 billion) from 3.6 trillion won in 2009. Asia’s fourth-largest polluter is joining the U.S. and Japan in increasing the use of alternative energy as the nation seeks to cut greenhouse gas emissions.

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