MonitorsPublished on Jul 19, 2011
Energy News Monitor I Volume VIII, Issue 5
The Economic and Political Rationale of South Asian Gas Projects

Saleem H. Ali*



he Arab world and present-day Iran have enjoyed strong trading ties with South Asia for millennia. There is considerable opportunity for extending these ties to the energy sector in novel ways. Historically, the discovery of gas reserves in Sui in Balochistan in the 1950s prompted Pakistan’s government to consider gas as a primary means of energy security. Gas now accounts for more than 50 percent of the country’s total energy generation. Meanwhile, India only began to seriously invest in gas infrastructure after 1987. Gas constitutes only about 8 percent of the country’s electricity generation mix but will likely increase to around 18 percent by 2025.1

The significance of compressed natural gas (CNG) in India was highlighted in 1998 when the Supreme Court ruled all commercial vehicles in New Delhi would need to switch to natural gas by 2001 due to pollution concerns. Pakistan already has more than one million cars on CNG and ranks third in global CNG prevalence after Brazil and Argentina.

Since indigenous sources are not enough to meet the growing demand in both countries, pipeline development is imperative to ensure long-term energy security. The idea of an overland trans-Pakistan pipeline from Iran is believed to have been first officially proposed in 1989 by Ali Shams Ardekani, acting deputy foreign minister of Iran. The idea, which came to be known as the Iran-Pakistan-India (IPI) project, began gaining momentum. Various routes were considered, with four major companies expressing interest in constructing the pipeline: BHP-Billiton of Australia, National Iranian Gas Company (NIGC), Petronas of Malaysia, and French Total.

In 1993, India signed a memorandum of understanding with Iran while continuing to explore other pipeline options. An agreement for an underwater pipeline from Oman was signed in 1994, but the project soon collapsed amidst financial and technological difficulties and has only recently been resurrected as a possibility by an Indian company named SAGE, which presented a feasibility study at the Doha Natural Gas Conference in March 2009. The discussions between India and Iran were hampered when Pakistan refused to allow a feasibility study in its exclusive economic zone. In 1997, Pakistani Prime Minister Nawaz Sharif gave his support to a proposal for a Turkmenistan-Afghanistan-Pakistan (TAP) pipeline project rather than IPI (Appendix 1). There was also the prospect of extending the TAP project to India (thus making it TAPI).

Initially, the TAP project would have tapped into more than 2.83 trillion cubic meters of natural gas reserves at Turkmenistan’s huge Dauletabad-Donmez field and delivered it across Afghanistan to Pakistan. The pipeline would carry up to 20 billion cubic meters of gas a year, generating $100-300 million per year in transit fees for Afghanistan and creating thousands of jobs.2

For an additional $500 million, TAP could be extended to Fazilka on the Pakistan-India border, providing gas to India as well. It could also be expanded further to connect fields in Central Asia to Gwadar in Pakistan, turning the port into one of the world’s most important energy hubs. From an energy security standpoint, TAP could provide Pakistan with 3,350 million meters cubic feet per day (mm cfpd) of gas, more than the 2,230 mm cfpd the IPI is expected to carry. Gal Luft argues that “economically, shifting from IPI to TAP should be of no consequence. The potential revenue of the IPI, $700 million in transit fees alone, would be collected too were TAP extended to India.”3

In April 2009, the TAP project received a boost when Turkmenistan officially provided gas reserves certification from the Yasrak field, claiming a potential reserve of 4 to 14 trillion cubic feet of gas. A new route has been proposed which would involve only a small portion of Afghani territory and enter Balochistan near Gwadar to avoid conflict in southwestern Afghanistan. In essence, this route would merge the TAP and IPI projects within Pakistan. Turkmenistan would provide 3.2 billion cubic feet gas to Afghanistan, Pakistan, and India. Afghanistan would receive $1 per million British thermal units (MMBTU) as transit fees under the new proposal.4

The financing of the pipelines has been considered by numerous parties. The Abu Dhabi-based International Petroleum Investment Company has expressed strong interest in financing the Pakistan portion of the IPI pipeline,5 while Iran has received offers of Russian financial assistance. As Russian President Vladimir Putin put it in 2006: “Iran wants it, Pakistan wants it, India wants it; Gazprom is ready to help.”6 However, Iran has been wary of accepting offers from Russia, which, as its biggest competitor, may try to obtain leverage over rival gas suppliers. Given the lingering memory of the Russo-Afghan war, Pakistan is also skeptical of Russian involvement. Already, Iran has built a substantial portion of the pipeline on its own to supply its domestic market.7 With the likelihood of securing Gulf investment for the Pakistani portion and government investment for the Indian portion, financial concerns are unlikely to present a major problem.

Development bank donors and the U.S. Government are also interested in funding the TAP project. Despite the positive outlook, both TAP and IPI still face several hurdles due to a host of factors that need to be understood in the context of the region’s geopolitical history.


Appendix 1

The South Asian Pipeline Projects


* The author is professor of environmental planning and Asian Studies at the University of Vermont.

1 Estimates on energy demand increase from Mike P. Jackson, “The Future of Natural Gas in India: A Study of Major Consuming Sectors,” Working Paper no. 67, Stanford University Program on Energy and Sustainable Development, 7.

2 John Shroder, “Afghanistan’s Development and Functionality: Renewing a Collapsed State,” Geojournal 70, no. 2-3 (October 2007): 91-107.

3 Gal Luft, “Iran-Pakistan-India Pipeline: A View from Washington,” Energy Security, June 15, 2007, <>.

4 Khalid Mustafa, “Turkmenistan to Supply Gas from Yasrak Field,” The News International, April 29, 2009.

5 Interview by author with Mohammed F. Azim, senior advisor, International Petroleum Investment Company in Abu Dhabi, March 10, 2009.

6 “Russia’s Gazprom is ready to participate in plans to build a natural gas pipeline from Iran to India via Pakistan: President Vladimir Putin,” India Daily,June 17, 2006.

7 Fars News Tehran. Interview with Hojjatollah Ghanimfard, broadcast April 26, 2009, <>.





Views are those of the author

Courtesy: Brookings Doha Center






ONGC rejects Cairn India restructuring

July 19, 2011. In signs of a souring relationship, state-owned Oil and Natural Gas Corp (ONGC) has withheld consent for internal restructuring of Cairn India Ltd for the past one year. Cairn wants the stakes that its different subsidiaries, including some registered abroad, hold in various oil and gas properties, including the showpiece Rajasthan oilfields, to be transferred into one India-based company. Since ONGC is partner in six of those properties, Cairn procedurally sought a no-objection from ONGC, but the state-run oil giant has so far not agreed to the proposal. The restructuring is separate from London-listed mining group Vedanta Resources' $9 billion buyout of Cairn India. 

Only 21 Reliance Industries' blocks may get unconditional nod for stake sale

July 17, 2011. More than four months after UK's BP agreed to buy stake in 23 oil and gas blocks of Reliance Industries for $7.2 billion, the Government may give unconditional approval for stake sale in only 21 blocks. Approval for sale of 30 per cent interest in deepwater block NEC-DWN-2002/1 in Bay of Bengal and Assam onland block AS-ONN-2000/1 may be conditional as oil regulator DGH has not agreed on the status of exploration in two acreages. BP had announced buying 30 per cent stake in 23 blocks of Reliance, including prolific KG Basin block D6 and gas discovery block NEC-25. While Reliance made an application for transfer of interest on February 25, Oil Ministry sent the proposal to the Cabinet Committee on Economic Affairs (CCEA) for approval.

Law ministry in its comments on Cabinet note raised the issue of the two blocks, where the Directorate General of Hydrocarbon (DGH) and Reliance are in disagreement over exploration status. In NEC-DWN-2002/1, Reliance had taken an extension of Phase-I of its exploration campaign. In the meanwhile, the government recently announced rig moratorium, allowing firm more time to fulfill their drilling commitments which they had previously not met due to global shortage of drilling rigs.


RIL gas cut may spark diesel crunch

July 18, 2011. India's biggest refiner-marketer, IndianOil Corporation, has warned the government that reduction in gas supplies from RIL's showcase Andhra offshore field may spark shortage of diesel and force imports to bridge the gap. The state-run company has told the oil ministry that the reduction in gas supplies may also render infructuous the huge investments made in upgrading refinery systems for using gas as fuel and considerably raise emission levels of greenhouse gases, responsible for global warming. Reliance cut supplies to non-core industries such as refineries, petrochemicals and steel plants from May 9 under government orders. The ministry ordered RIL to cut supplies in proportion to allocations made to units after production from the Andhra offshore field dropped a tad below 50 mcmd (million cubic metres per day) from over 60 mcmd. IOC said the cut in gas supply would force the company to use about 200,000 tonnes of diesel as substitute fuel at its Gujarat refinery with resultant reduction in supply to market. IOC reckons it would lose ` 460 crore annually on burning diesel as a replacement fuel, which would also reduce 1.4% of distillate yield from its Gujarat refinery. The Gujarat unit is IOC's third major refinery after Panipat and Mathura plants. The government had allocated 1.6 mcmd of gas for IOC's refineries. It also earmarked another 1.9 mcmd on fallback basis. But the company was able to ink purchase agreement for only 0.9 mcmd to Gujarat refinery since RIL's output dropped.

Transportation / Trade

GAIL may acquire 50 pc stake in AP Gas Distribution Corp

July 19, 2011. Country's largest gas transmission and marketing company Gas Authority of India Limited may acquire 50 per cent stake in Andhra Pradesh Gas Distribution Corporation (APGDC), a wholly-owned subsidiary of AP Gas Infrastructure Corporation. If the move is successful, APGIC which was set up with an intention to create gas transportation infrastructure, will be eligible to participate in the bids for creating gas distribution networks in the country. While Andhra Pradesh Industrial Infrastructure Corporation Ltd (APIIC) holds 51 per cent in APGDC, AP Power Generation Corporation Ltd (AP Genco) owns remaining 49 per cent. According to the Petroleum & Natural Gas Regulatory Board rules, the companies which are bidding for the city's gas distribution network contracts should have experience of laying at least 300 km of gas network or should have three engineers on payrolls who participated in creation of similar network. However it is not clear that GAIL will also pick up stake in another APGIC subsidiary entity AP Gas Trading Company, which was set up for sourcing gas from domestic and overseas companies and supply it to the regional grid. GAIL also owns 50 per cent in Bhagyanagar Gas, another AP-based city gas distribution firm, in which Hindustan Petroleum Corporation Ltd (HPCL) holds the balance 50 per cent equity. GAIL has already entered into tie-ups with state entities in Karnataka and Kerala for city gas distribution and is said to be in talks with entities in various states, including Rajasthan, Maharashtra and Tamil Nadu. APGIC has recently submitted its expression of interest (EoI) to PNGRB to build a pipeline from Kakinada to Srikakulam, which was part of the 1,100-km Kakinada-Basudebpur-Howrah pipeline.

May stop oil supply to India, warns Iran

July 19, 2011. Iran warned India it would stop supplying oil from August 1 if payments dispute is not resolved. Iran, facing increased isolation internationally, and energy-hungry India have been trying to resolve an impasse triggered in December, when the Reserve Bank of India ended a regional clearing mechanism under US pressure. Iran says India owes it $5 billion for oil imports in recent months.

CGD players want OMCs to manage LPG connection withdrawal

July 15, 2011. The city gas distribution companies want the oil marketing companies to manage withdrawal of liquefied petroleum gas (LPG) connections from those who avail piped natural gas (PNG) connection. The gas regulator Petroleum and Natural Gas Regulatory Board has suggested the ministry of petroleum and natural gas (MoPNG) to reconsider the decision to put responsibility of withdrawal of LPG connections from consumers on CGD entities. According to the arrangement, CGD players are responsible for withdrawing LPG connections instead of issuing authority government controlled OMCs. Earlier, it was proposed for the consideration of the government that instead of insisting on the withdrawal of the LPG connection, the CGD entity would notify the concerned OMC of the consumers provided with PNG connection. On the basis of the information supplies, the OMCs should keep the connection in suspended animation under the scheme of 'safe custody'. In case such a consumer would require a cylinder due to any reason, he should be supplied at the commercial rate. The detail of the scheme has actually been worked out in an industry meeting. PNGRB also raised its concerns over MoPNG issuing instructions to the regulated entities on matters within competence of the regulator. PNGRB opposed MoPNG's notification under Essential Commodities Act prohibiting CGD entities providing PNG connections to consumer with LPG connection of a government oil companies.

Policy / Performance

Petroleum regulator, oil ministry lock horns on gas

July 19, 2011. The oil ministry and the petroleum regulator have crossed swords for the second time this year as the petroleum and natural gas regulatory board (PNGRB) has charged the government of stepping on its turf in a manner that questions the basis of its existence. The regulator, pitching for rapid expansion of city gas networks, is miffed by the oil ministry's decree that forbids supply of subsidised cooking gas in homes which also get subsidised cooking gas. This has made consumers to switch to the piped gas although it is not subsidised but cheaper than cooking gas. The oil ministry is stepping on regulatory turf, highlighting the volatile relationship between the two. This is the second major clash in recent months between the oil ministry and the regulator. Further, Indraprastha Gas, controlled by state firms, had challenged the regulator's powers in court and crippled its functioning. The regulator has proposed market rates for cooking gas cylinders supplied to households with piped gas connections to reduce government's subsidy burden and provide an alternative fuel to housewives for emergency. Subsidised LPG cylinders are a long-term threat for city gas networks. Currently, natural has is competitive even without subsidy but industry say that gas companies are worried that if the government does not lift controls on LPG prices, piped gas may lose its competitive edge in the long term. The regulator aims to set up piped gas networks in hundreds of cities and sustained commercial viability and natural gas supply are important for attracting the desired level of investment. A large number of piped gas consumers were tenants who would not want to surrender their LPG connection as they might shift to a location which would not have piped gas connections. Reluctance of consumers to surrender LPG connections before getting PNG supply is also affecting energy firms that are unable to achieve minimum number of household customers, one of the biddable criteria for winning the project. They fear penal action by the board for not meeting the bidding criteria. An oil ministry defended the government action saying that instead of allowing a customer to retain two types of fuel connections, it is prudent to divert the highly-subsidised cooking gas cylinders to rural areas which do not have clean fuel supply. Currently, one LPG cylinder is supplied at 395.35 in New Delhi, about 314 below the market rate. PNG, which is cheaper than LPG, is sold without any subsidy component.

Oil PSUs hike jet fuel price

July 15, 2011. State-owned oil firms hiked jet fuel or ATF price by a marginal ` 78 per kilolitre. Aviation Turbine Fuel (ATF) in Delhi will cost ` 56,324.79 per kl, an increase of ` 77.93 per litre or 0.13 per cent, from ` 56,246.86 per kl. The marginal increase in jet fuel rates come on back of a 2.75 per cent reduction in price, effective from July 1. ATF in Mumbai, home to the nation's busiest airport, will cost ` 57,031.66 per kl as against ` 56,964.01 per kl current price. Fuel cost accounts for 40 per cent of the airlines' operating cost and rates vary from airport to airport depending upon the local sales tax. IOC and its sister public sector retailers Hindustan Petroleum Corp (HPCL) and Bharat Petroleum Corp (BPCL) revise jet fuel prices on the 1st and 16th of every month.

Oil ministry replies to CAG observations on KG D-6 blocks, defends its stance

July 13, 2011. The oil ministry has told the Comptroller and Auditor General (CAG) that it abided by the contractual provisions in dealings with Reliance Industries and Cairn India and argued that revision of development plans, which has been questioned by the national auditor, is a "best practice" prevalent in the industry. The government, facing allegations of violating rules to financially benefit oil and gas field operators such as Reliance, Cairn and BG, also told the CAG that the prime objective of inviting private investment in the sector was to speed up exploration. Flow of revenue to the government - being scrutinized by the CAG - was consequential. The CAG's draft report has castigated the oil ministry for allowing Reliance Industries to raise capital expenditure in its KG D-6 block, and questioned its decision to allow Cairn to extend the area of discovery.



NTPC hopeful Bengal power project issues will be resolved

July 18, 2011. The country's largest power generation company, NTPC Ltd, said it was hopeful that the issues holding up implementation of its power projects in West Bengal will be resolved soon. For critical power plants, at least two units are required at the same site to make it viable.

Three hydel power plants to come up in Mizoram

July 18, 2011. The state-owned North Eastern Electric Power Corporation Ltd. (NEEPCO) will set up three power plants in Mizoram, generating a total of 1,526 MW. The two sides signed a Memorandum of Agreement for commissioning three hydel power projects (815 MW, 635 MW and 76 MW), with a cumulative generation capacity of 1,526 MW. Mizoram has many rivers, creating a huge scope for setting up hydel power projects. Currently, the NEEPCO, under the union power ministry, has been executing three hydro-electric and two gas-based thermal power projects in Arunachal Pradesh and Tripura with a total generation capacity of 920 MW.

BHEL commissions India's first 525 MW thermal set for Maithon Right Bank thermal power project in Jharkhand

July 18, 2011. For the first time in the country, Bharat Heavy Electricals (BHEL) has commissioned a 525 MW thermal set for the Maithon Right Bank thermal power project in Jharkhand. The 2x525 MW greenfield power project is being implemented by Maithon Power Limited (MPL), a joint venture between Tata Power and Damodar Valley Corporation. BHEL said it has commissioned India's first thermal set of 525 MW rating at Maithon Right Bank thermal power project in Jharkhand. The state-run power equipment major had bagged the order for 1,050 MW project, outbidding a Chinese supplier. After bagging order for two 525 MW units from MPL, the company has secured orders for four more such units, taking the number of 525 MW sets contracted to six sets, so far. The power equipment maker is in the process of augmenting its capacity to 20,000 MW per year from existing 15,000 MW per annum.

Alstom bags ` 2.7 bn contracts for setting up three hydropower projects in India

July 18, 2011. French power equipment maker Alstom said it has bagged ` 270 crore contracts for setting up three hydropower projects in India. The first contract has been signed with Shiga Energy for the 97 MW Tashiding hydroelectric project based in Sikkim. The second contract has been signed with NSL Tidong PowerGeneration for 100 MW Tidong-I hydro project in Kinnaur district of Himachal Pradesh. The third contract has been signed with Haridwar Infrastructure for 96 MW Dikchu hydroelectric project in Sikkim, Alstom said in a statement. All the equipment would be manufactured at Alstom's Vadodara facility in Gujarat. The contracts follow a deal signed by Alstom with Tehri Hydro Development Corp for the 1,000 MW Tehri hydro power plant in Uttarakhand. Alstom's projects under execution include the 2,000 MW Subansiri Lower hydroelectric power plant in Assam and Arunachal Pradesh.

Adani Power may look at bidding for ultra mega power projects

July 18, 2011. Power utility Adani Power may look at bidding for ultra mega and as well as coal-based power projects having a minimum generation capacity of 4,000 MW. Adani Power, a part of diversified Adani group, has an ambitious plan of having a capacity of 16,500 MW in the coming years. As part of efforts to meet the growing electricity demand, the government is encouraging UMPPs. Each such project has a generation capacity of about 4,000 MW, entailing an investment of about ` 16,000 crore. A total of 16 UMPPs have been envisaged and special purpose vehicles have been set up for 12 projects. So far, the government has awarded four UMPPs - Sasan in Madhya Pradesh, Mundra in Gujarat, Krishnapatnam in Andhra Pradesh and Tilaiya in Jharkhand. Three of them - Sasan, Krishnapatnam and Tilaiya - are implemented by Reliance Power, while Mundra project is done by Tata Power. Adani Power, along with its subsidiaries, has nine power projects -- having a combined capacity of 16,500 MW. Of the total, 1,980 MW has been commissioned and 7,260 MW is under implementation.

Transmission / Distribution / Trade

NTPC Vidyut Vypar Nigam Ltd to export 250 MW power to Bangladesh

July 18, 2011. State-run power major NTPC's trading arm NTPC Vidyut Vypar Nigam Ltd. (NVVN) has been given the mandate to export 250 MW of power from NTPC to Bangladesh. NVVN has signed the power purchase agreement with the Bangladesh Power Development Board (BPDB). The transmission lines between India and Bangladesh are being set up under a pact signed between Power Grid Corporation of India Ltd and BPDB. The links are expected to be in place by early 2013 and are being executed at a cost of around $190 million, with a capacity to wheel around 500 MW. The interconnection between India and Bangladesh is being established through a 500-MW HVDC (high voltage direct current) link between India's eastern region and the western grid of Bangladesh.

NTPC to make final bid for Australian mine

July 13, 2011. Country's largest power producer NTPC Ltd will make a final offer for a stake in Australia's Bandanna Energy Ltd. Two other Indian companies including GMR and Essel Mining are among the many global companies believed to be vying a stake in the coal explorer. Bandanna holds 16 exploration permits in the Bowen and Galilee basins in coal-rich Queensland apart from licences to explore for minerals and oil shale in the state. It has reserves of at least 1.4 billion tonnes of coal

Shunglu panel on discoms to submit report in Aug or Sept

July 13, 2011. The Shunglu Committee looking into the financial health of power distribution companies will submit its report in August or September. The committee's terms of reference include a review of the accounts of state electricity boards and power distribution companies (discoms). The panel is also looking into the financial health of the discoms, apart from reviewing electricity tarrifs. The report will be sent to the Power Minister, as well as all Chief Ministers. According to the Planning Commission's estimates, electricity distribution losses totalled a whopping ` 70,000 crore in 2010-11. There are growing concerns that the huge losses incurred by power distribution utilities could adversely impact investment in the power sector. There are about 73 distribution utilities in the country.

Policy / Performance

India starts building 25th N-plant

July 19, 2011. Sending a strong signal on continuance of its nuclear programme despite the Fukushima accident, India began construction of its 25th atomic power plant and announced to build four more indigenous 700 MW units than planned earlier. The first pour of concrete for the 700 MW indigenous Pressurised Heavy Water Reactor (PHWR), the seventh nuclear plant at the Rajasthan Atomic Power Station (RAPS), took place in this bustling Rajasthan township about 65 km from Kota. The 25th plant coincides with the silver jubilee of NPCIL next year. The construction of this plant was scheduled to start in March but was put off pending safety review in the wake of the Fukushima nuclear accident. After the review, some additional safety features were incorporated and the 700 MW plant now can withstand a scenario of a breach in the Gandhisagar dam situated at a height near Rawatbhata and simultaneous July 26 like rainfall in the region.

June power output up 8.2 pc y-o-y: Govt

July 14, 2011. India's power output rose an annual 8.2 percent in June, slower than the previous month, due to fuel shortages but peak power deficit narrowed as monsoon rains curbed demand in southern and eastern parts of the country. As on June 30, India's installed capacity stood at about 177 gigawatt (GW) and the country aims to add 17.72 GW in the current fiscal that began on April 1. Electricity generation last month was 70.79 billion kilowatt hours (kwh) versus 65.41 billion kwh in a year ago, the Central Electricity Authority (CEA) said. In May, electricity generation had risen an annual 10.45 percent to 75.10 billion kwh. Last month, the peak power deficit, the shortfall between supply and demand during peak hours, narrowed to 8.7 percent from 8.9 percent in May.

India needs to significantly raise its generation capacity to reduce peak hour power shortages and provide electricity to millions of rural households. The Asian nation is set to miss its target to add 62 GWs of capacity over a five-year period ending next March, mainly due to delayed environment clearances and allocation of coal linkages. Thermal electricity, which accounts for about two-thirds of India's power generation and includes using coal, gas and liquid fuel, rose 4.99 percent in June when coal-fired output rose by 7.89 percent from a year ago thanks to capacity additions. However, coal supplies in June at 30.16 million tonnes fell short of requirement by 18 percent, the data showed. India aims to import 55 million tonne of coal for power plants in the current fiscal that began on April 1. Gas-based generation declined 4.58 in June due to low availability of fuel.

NTPC may scale down 2017 power generation target to 70 GW

July 13, 2011. Coal supply shortages and environmental hurdles may force state-run NTPC to scale down its target for ramping up power generation capacity to 75,000 MW by 2017 to 70,000 MW. The 75,000 MW target is also achievable. NTPC, which currently generates over 34,000 MW of power, had set a target for scaling up this capacity to 75,000 MW by 2017 and to further augment it to 1,28,000 MW by 2032. The company, which requires huge funding for its upcoming and expansion projects, recently signed a ` 10,000 crore (over $2 billion) loan agreement with State Bank of India for financing its projects.

The Ministry of Coal cancelled three coal blocks -- Chhati Bariatu (South), Chatti Bariatu in Jharkhand and Kerandari in Jharkhand -- of NTPC due to the power company's failure to develop the mines. The Chatti Bariatu and Kerandari coal blocks in the North Karanpura coalfields in Jharkhand were allocated to NTPC in 2006 for captive use in their own specified end-use projects. On the other hand, the Chatti Bariatu (South) coal block was given to the company in 2007. The other two blocks that were cancelled include the Saharpur Jamarpani coal block in Jharkhand, allocated to Damodar Valley Corporation in 2007, and the Banhardih coal block given to Jharkhand State Electricity Board in 2006.

West Bengal govt to take stake in CIL's coal-to-liquid project

July 13, 2011. The West Bengal government has decided to fast track and take a stake in the proposed Rs 10,000-crore coal mining and coal-to-oil project in Bengal that was originally planned by Coal India in joint venture with National Mineral Development Corporation (NMDC). The coal-to-oil project was proposed near the Deocha Panchmi block which holds reserves of some 19 billion tonnes of coal at a depth of some 150-200 metres.

PFC in talks with NPCIL for lending ` 120 bn for power projects

July 13, 2011. State-run lending agency Power Finance Corp is in advanced talks with Nuclear Power Corporation of India for lending Rs 12,000 crore to set up two atomic plants in Gujarat and Rajasthan with a total capacity of 2,800 MW. Nuclear Power Corporation of India (NPCIL) is building two units of 700 MW each at Kakrapur atomic plant in Gujarat and Rajasthan atomic power plant. NPCIL is expanding its operations and therefore requires capital infusion. PFC and NPCIL signed a Memorandum of Understanding in October, 2010, for offering financial assistance to NPCIL for its new power projects as well as renovation and refurbishment of life extension projects. Meanwhile, PFC would issue tax-free bonds to raise Rs 5,000 crore of the total borrowing target of Rs 30,000 crore in the current financial year for funding power projects.

Tata Power inks pact with Maharashtra govt for R&R package

July 13, 2011. Tata Power has inked a pact with Maharashtra government for the rehabilitation and resettlement package related to the utility's proposed 1,600 MW thermal power plant in Raigad. The supercritical thermal power plant, based on imported coal, is coming up at Dehrand and Shahapur villages in Raigad district of Maharashtra. Among others, Tata Power as part of the package would provide one time compensation of Rs 5 lakhs per acre to each Project Affected Family (PAF) in lieu of 12.5 per cent developed land. The agreement for Rehabilitation & Resettlement (R&R) package was signed by the two parties, Tata Power said. The company would also shell out ` 2 crore per village -- Dehrand and Shahapur -- for basic infrastructure and civic amenities. Tata Power would annually spend ` 25 lakh per village towards subsequent maintenance of the basic infrastructure and civic amenities. The amount would be increased by 10 per cent every three years. The 1,600 MW project has got all statutory clearances. Coal for the plant would be imported from Indonesia




Taiwan's oil company to invest $1.18 bn a year

July 19, 2011. Taiwan's state-run Taiwan's state-owned CPC, said it will invest NT$34 billion ($1.18 billion) annually in the next five years to acquire and explore overseas energy resources. CPC plans to spend NT$30 billion a year on acquiring oil and gas fields mainly in Africa and the Asia Pacific region while the rest will go on oil exploration. The company expects to be able to boost its daily crude output from 12,000 barrels daily at present to 27,000 barrels a day from 2012. The company is in talks to buy oil and gas fields in Africa and Australia. CPC started exploring oil reserves abroad in the 1970s and its latest venture in Chad is estimated to have at least 100 million barrels in reserves. CPC supplies about 700,000 barrels of crude oil a day or about 60% of Taiwan's daily usage, of which only 1% is produced by itself and the rest is imported. Taiwan doesn't have any oil resources of its own and is dependent on imports mainly from the Middle East and Africa.

Halliburton profit rises 54 pc on North American oil spending

July 19, 2011. Halliburton Co., the world’s second- largest oilfield-services provider, said second-quarter profit increased 54 percent as higher crude prices led to more spending on exploration and production in North America. Oil and natural-gas companies are expected to spend $122 billion in the U.S. this year on exploration and production, 22 percent more than last year. The average number of active U.S. oil and gas rigs rose to 1,826 in the second quarter, up 21 percent from 1,506 a year ago.

Australia's Santos to buy Eastern Star Gas to boost reserves

July 18, 2011. Australian energy group Santos Ltd agreed to buy smaller peer Eastern Star Gas Ltd in an all-share deal valued at A$868 million ($920 million) to beef up Santos' gas reserves for its LNG export ambitions. The deal also involves selling a 20 percent interest in Eastern Star Gas's permits in the Gunnedah Basin in the state to TRUenergy Holdings, the Australian arm of Hong Kong's CLP Holdings, for A$284 million. The offer is the fourth major resources transaction in a week, including BHP Billiton's $12.1 billion bid for U.S. shale gas producer Petrohawk Energy, and Peabody Energy and ArcelorMittal's $5 billion bid for Macarthur Coal. Sichuan Hanlong Group of China made a $1.5 billion bid for West African iron ore explorer Sundance Resources.

BHP to Acquire Petrohawk for $12.1 bn, betting natural gas will climb

July 16, 2011. BHP Billiton Ltd., the world’s largest mining company, agreed to buy Petrohawk Energy Corp. for about $12.1 billion in cash in its biggest acquisition, betting natural gas demand will gain in the U.S. BHP will pay $38.75 a share using cash and debt, the companies said. That’s 61 percent more than Houston-based Petrohawk’s average price over the past 20 trading days and compares with the 25 percent average premium in 17 deals worth at least $5 billion for oil and gas producers in the past five years.

Oil companies fail to bolster peace in Nigeria

July 15, 2011. Peace in Nigeria’s main oil- producing area is threatened by the failure of companies to invest in improving residents’ living standards. While a government amnesty in August 2009 ended most of the fighting in the Niger River delta and disarmed thousands of militant fighters, the oil companies are not giving back. Oil output in Nigeria, Africa’s biggest producer, has risen to more than 2.1 million barrels a day from 1.7 million barrels in July 2009, a month before the amnesty. Attacks by armed groups cut more than 28 percent of oil output between 2006 and 2009.

U.K. offshore drilling falls to nine-year low

July 14, 2011. Oil companies operating in the U.K. North Sea drilled 43 percent fewer wells in the first half, in part because of a tax increase. Operators drilled 20 exploration and appraisal wells in the period, down from 35 a year earlier. Chancellor of the Exchequer George Osborne raised taxes on oil-production profits to 62 percent from 50 percent in this year’s budget to pay for a lower duty on gasoline. BP Plc and BG Group Plc were among producers who said the increase would curb future investment in U.K. oil and gas fields. The government increased tax allowances for some North Sea project investment, prompting Norwegian producer Statoil ASA to resume work on the Mariner field development.

China asks ConocoPhillips to halt production at oilfield

July 13, 2011. China's State Oceanic Administration has told ConocoPhillips to stop production at two platforms of offshore Chinese oilfield Penglai 19-3. ConocoPhillips is the operator of Penglai 19-3, China's largest offshore oilfield.


PetroVietnam Gas awards gas facility construction to local companies

July 18, 2011. State-owned PetroVietnam Gas Corp., or PV Gas, has awarded a contract valued at $441.57 million to a consortium comprising two domestic companies to build a gas processing plant and associated pipeline system in southern Vietnam. Under the deal signed, PetroVietnam Construction Corp. and PetroVietnam Equipment Assembly and Metal Structure Co. will build the gas processing plant in Vung Tau province. The plant will has an annual processing capacity of more than 7 billion cubic meters of gas, and will start operating from 2014. The new facility will use natural gas from Hai Thach-Moc Tinh and Thien Ung-Mang Cau gas fields in the Nam Con Son basin off southern Vietnam via the Nam Con Son 2 Gas Pipeline. These fields are expected to produce 1.5 billion cubic meters of natural gas a year by 2013, 2.8 billion cubic meters by 2014 and 3.09 billion cubic meters by 2017.

Iran’s offer to expand Sri Lanka’s oil refinery rejected

July 17, 2011. The Sri Lankan government has rejected Iran’s offer to assist in expanding the island’s Sapugaskanda oil refinery capacity from 50,000 to 100,000 barrels per day over a dispute on the project’s financing.

The deal breaker was Iran’s insistence that Sri Lanka commit $500 million of its share of the cost up front, but the Treasury baulked at immediately committing such a vast sum. The Treasury would have acceded to the Iranian request if it at least had been on a pro rata basis based on the progress of the project, but backers of the refinery expansion now need to find an alternate financing source. In the interim the situation at Sapugaskanda is becoming more strained as the refinery is finding it increasingly difficult to produce gasoline and diesel under ever more stringent standards to meet environmental concerns, which has resulted in the refinery diminishing its output to 40,000 barrels per day.

Transportation / Trade

Woodside delays orders for Pluto LNG expansion

July 19, 2011. Woodside Petroleum Ltd. has slowed progress on an expansion of its flagship Pluto gas-export project as it searches for more gas, potentially assisting rival developments vying to supply Asia with cleaner-burning fuels. Australia's biggest pure-play oil company also announced its second-quarter revenue jumped 17% to US$1.25 billion after unrest in the Middle East and North Africa helped drive oil prices above US$100 a barrel. Woodside is betting billions of dollars on projects like Pluto that could transform the company into a major gas exporter in the Asia-Pacific region. Australia's vast gas reserves and stable political climate have lured the likes of Royal Dutch Shell PLC, Chevron Corp and ConocoPhillips, which are building giant liquefied natural gas plants along its northern coastline.

NuStar reactivates Pettus South Pipeline

July 19, 2011. As part of an agreement with Koch Pipeline Company, L.P., NuStar Logistics has reactivated its Pettus South Pipeline to transport Eagle Ford Shale crude oil to Corpus Christi, Texas. The previously idled pipeline runs 60 miles from Pettus, Texas to Corpus Christi. NuStar is operating the pipeline. Koch Pipeline will soon complete a project to expand delivery capability to the Flint Hills Resources Ingleside waterborne terminal.

The company is also building a crude oil terminal in Helena, along with a new line from Helena to Pettus, where the company has an existing crude oil terminal. Another 60-mile line from Pettus to Corpus Christi has received final approval. Koch Pipeline is the largest transporter of South Texas crude and operates about 540 miles of active crude oil transportation lines in Texas. The company also has ongoing relations with other crude distribution systems that further its ability to provide services in the Eagle Ford area. NuStar also has been working on other projects to expand and modify its pipeline and terminal infrastructure to transport and store even greater volumes of Eagle Ford Shale crude and condensate.

Ukraine to modernize gas transport system with European loan

July 19, 2011. Two European financial agencies will loan Ukraine 308 million dollars to modernize portions of its natural gas transport system. Ukrainian has been a leading proponent of Kiev making its gas pipeline network more efficient, so Russia will continue to ship its gas to Europe via Ukraine. Repeated conflicts between Moscow and Kiev over gas pricing led to a full stop of Russian gas shipments to Ukraine in early 2009, causing price spikes as far away as Spain. Since then the Kremlin has supported the construction of new gas pipelines bypassing Ukraine to Europe, one via the Baltic Sea to Germany and a second across the Black Sea to Romania.

ESI to supply software for Petronas project

July 18, 2011. Energy Solutions International (ESI), together with a local Malaysian partner, has been selected to supply their solutions for a Gas Management System of Petronas Gas Transmission Pipeline project. The project is owned by PETRONAS Gas Berhad (PGB).

PGB plays a prominent role in the gas business value chain in Malaysia providing gas processing and transmission services to end customers all over the country. Energy Solutions International, Inc. (ESI) is a leading global supplier of pipeline management software for the oil and gas industry. Founded in 1976 and headquartered in Houston, Texas, ESI serves more than 500 clients in over 50 countries through its offices in the United States, United Kingdom, United Arab Emirates, India, Singapore, China and Canada.

Global LNG market grows, new markets emerge

July 18, 2011. The global liquefied natural gas (LNG) market continues to expand and transform as the volume of LNG traded globally keeps rising and new and existing players enter the market or expand LNG activity.

In 2010, the volume of LNG traded globally hit 223.8 million tones/annum (MMtpa), the International Gas Union's (IGU) World LNG Report 2010 noted, a 41 MMtpa increase from 2009 and the largest year-on-year growth experienced by the industry, thanks to newly-commissioned liquefaction trains and the ramp-up in output from trains commissioned in 2009. When compared to the 143 MMtpa of LNG traded in 2005, the market has grown by over 50 percent over the past five years.

Exxon prepares to replace ruptured pipeline

July 13, 2011. Exxon Mobil said it had begun preliminary work to replace the pipeline that ruptured and spilled an estimated 1,000 barrels of oil into the Yellowstone River in Montana. Exxon, the world's largest publicly traded oil company, said it was aiming to meet federal requirements on corrective action around the Silvertip pipeline before resuming operations. Preliminary work includes talks on permitting requirements, rights of ways, drilling equipment, contracting and pipeline fabrication and transportation, the Irving, Texas.

Policy / Performance

China gives final nod to CNOOC's Hainan LNG project

July 19, 2011. China has given final approval to CNOOC Group's 2.0 million tonne-per-year liquefied natural gas (LNG) project on the southern island province of Hainan, the government said. The project won final approval from the National Development and Reform Commission on July 7. The first phase of the Hainan LNG terminal is expected to go onstream in 2014 and reach the designed capacity of receiving 2.0 million tonnes of the super-cooled gas per year in 2016. In connection with the project, Hainan will build China's largest LNG storage and transferring centre.

Brazil president to reduce ethanol mix

July 19, 2011. Brazil has decided to reduce the amount of ethanol mixed into domestic gasoline as part of her efforts to combat inflation. Rising prices for sugar -- and therefore for sugar cane-derived ethanol -- have been a major factor in pushing inflation above Brazil target range. At present, anhydrous ethanol is blended into local fuel at a ratio of 25 percent.

Australia to help key resources state bring in workers

July 19, 2011. Australia will adjust immigration laws to help businesses in resource powerhouse Western Australia state plug a skills gap threatening to crimp exports, by bringing more workers from overseas.

Immigration Minister Chris Bowen said he would widen a regional migration scheme designed to make recruitment of semi-skilled foreign workers faster and less restrictive to include the West Australian capital Perth. A record A$380 billion in mining investment, four times Australia's average for the past 30 years, was expected to lead to a shortage of 36,000 trades-people by 2015, Bowen said.

Western Australia as a whole expects a shortage of 150,000 skilled workers by 2017 as infrastructure and resource investments across the state gather pace. Mining giants Rio Tinto, BHP Billiton and Fortescue are all well entrenched expanding their iron ore operations amid a once-in-a-century mining boom driven by demand from Asia. And firms like Woodside, ConocoPhillips, Royal Dutch Shell BG Group, Chevron, Santos and Origin are pouring cash into country's natural gas and coal seam gas sector. Bowen said the immigration changes would make it easier for employers to get semi-skilled workers from overseas and help them transition to permanent residency in Australia. The government said in its May budget that it would try to ease a shortage of skilled workers that threatened to fuel inflation, lifting skilled migration by 10,000 to 125,850 in a move that resource companies said did not go far enough.

Shell seeks to sell stake in C$16 bn Mackenzie gas project

July 18, 2011. Royal Dutch Shell Plc said it plans to sell its stake in a long-stalled, C$16.2-billion natural-gas production and pipeline project in Canada's far north, as well as its other assets in the region. The fate of the Mackenzie Gas Project, which envisions bringing natural gas from fields bordering the Arctic Ocean to markets in North America, has long been in doubt. But Shell's departure from the project marks the surprise capitulation of one of the project's oldest and biggest partners. Consortium members have weathered years of regulatory review and roller-coasting gas prices, betting that the region's gas trove would one day be economical.

Japan power sector oil demand may triple as nuclear output falls

July 18, 2011. Japan's demand for crude and oil products to fuel power plants could triple if the country shuts all its nuclear reactors due to growing public safety concerns after the March earthquake and tsunami.

The country's energy policy was left in tatters after the quake caused the worst nuclear accident in 25 years. Japan had planned to increase nuclear power supply to meet 50 percent of demand, from 30 percent before the quake.

The world's third-largest oil consumer may need to import an additional 350,000 barrels per day (bpd) of crude and fuels to make up for the loss. That would be 8 percent of Japan's total oil consumption, straining a market already struggling to compensate for the loss of production from Libya and trading over $100 a barrel. It may need an extra 20 million tonnes of LNG, equivalent to a third of annual demand.

Texas first state to enact hydrofracking rules

July 16, 2011. Texas Gov. signed energy legislation to encourage more natural gas production and require energy companies to disclose chemicals used in hydraulic fracturing, a drilling method that has raised environmental concerns.

With the signing, Texas becomes the first state to require energy companies to disclose chemicals used in the hydraulic fracturing process, where drillers blast pressurized water and chemicals deep underground to break rocks and release gas or oil from coal beds, shales and tight sands.

Canada seeks China energy sales amid ‘exaggerated rhetoric’ for oil sands

July 15, 2011. Canadian Natural Resources Minister Joe Oliver said the nation will seek to grow energy sales to China, and challenge environmentalists in the U.S. and Europe, to sustain demand for the world’s largest reserves of oil outside the Middle East. Oliver, said he plans a global campaign to challenge “exaggerated rhetoric” about the environmental impact of Alberta’s oil sands. Canada also must build new markets for its oil, which is now shipped primarily to the U.S., he said.

Canada is relying on business investment to help lead its recovery, and energy companies have been the main driver of corporate spending over the past year.

Canadian publicly traded oil and gas companies spent C$18.5 billion ($19.3 billion) on investment in the latest quarterly filings, up from C$14.5 billion from the same quarter a year earlier.

Internationally, Prime Minister Stephen Harper has promoted Canada as an “energy superpower,” pointing to its political stability in a bid to fend off concerns in the U.S. about the environmental impact of the oil sands, which require extensive upgrading and refining in a process that generates more greenhouse-gas emissions than conventional crude.

Brazil's Petrobras lowers natural gas prices

July 15, 2011. Brazilian energy giant Petrobras will lower natural gas prices for contracts up for adjustment in August, the company said in a nod to inflation worries in Latin America's biggest economy. Petrobras will discount those contracts by 14.3 percent, up from a 9.7 percent discount in May, the company said.

S.Korea's June LNG imports rise 5 pc yr/yr

July 15, 2011. South Korea's imports of liquefied natural gas (LNG) rose 5 percent in June from a year earlier due to strong demand for power generation on economic recovery and seasonal factors.

South Korea, the world's second-largest LNG buyer after Japan, imported 2.12 million tonnes of LNG last month, compared to 2.01 million tonnes the year before.

State-run Korea Gas Corp, the world's largest corporate buyer of LNG and the country's sole LNG wholesaler, said it had sold gas equivalent to 2.07 million tonnes of LNG domestically in June, up 17 percent from a year earlier. Of the total, 1.17 million tonnes were for power generation, up 22.5 percent from a year ago.

Boone Pickens says still buying shale acreage

July 13, 2011. Energy investor T. Boone Pickens said he has been buying up U.S. shale acreage, and he could consider signing joint ventures to develop the properties, or some property sales. Pickens said his other shale holdings are in an oil shale field, but he declined to name the field.

Advances in drilling technology in the past decade have opened up vast tracts across the United States to oil and gas drilling that were once too difficult or expensive to tap.

The shale fields could hold enough natural gas to supply the United States for more than a century, experts have estimated, although the hydraulic fracturing techniques used to extract the gas have raised environmental concerns in some areas.

Companies are also shifting drilling efforts into shale fields that hold oil or natural gas liquids, since those fuels are fetching far higher prices than natural gas. That boom has seen property prices in some gas basins such as the Marcellus surge above $10,000 an acre, while prices in the liquids-rich areas of Texas's Eagle Ford shale have topped $20,000 an acre.

Pickens said there appear to be at least two companies interested in setting up joint ventures with shale acreage owners, but has not made any moves so far.



First phase of $1 bn Salalah power project completed

July 19, 2011. Sembcorp Salalah Power and Water Company, a joint venture company between Sembcorp’s fully-owned subsidiary Sembcorp Utilities and the Oman Investment Corporation, has successfully completed the first phase of its $1 billion Salalah Independent Water and Power Plant (IWPP) in Oman.

With the completion of the first phase, the facility began dispatching 61 megawatts of power, on schedule, to the Dhofar power grid. Targeted to begin full commercial operations in the first half of 2012, the Salalah IWPP will consist of a gas-fired power plant which will have a total net capacity of 445 megawatts and a seawater desalination plant which will employ reverse osmosis technology to produce 15 million imperial gallons (69,000 cubic metres) per day of water.

China June power output up 16.2 y/y

July 13, 2011. China's power output in June rose 16.2 percent from a year earlier to 396.8 billion kilowatt hours.

June's power output was also up 5.1 percent from a month ago, when total generation stood at 377.5 billion kilowatt hours, thanks to heavy rains which ended months of drought and boosted to hydro power generation.

Only two of the 26 provinces served by State Grid Corp of China have been restricting power consumption since June 10, after widespread rainfall lifted hydro power generation and led to a fall in power use for air conditioning.

China's industrial output rose 15.1 percent in June from a year earlier and annual gross domestic product growth eased to 9.5 in the second quarter of 2011 from 9.7 percent in the previous quarter.

Transmission / Distribution / Trade

Australia's Bandanna asks suitors to submit binding bids

July 14, 2011. Australian coal explorer Bandanna Energy says it has asked potential bidders for the company to provide binding offers after shortlisting parties as part of a strategic review.

Bandanna said that proposed bids included individual project assets and corporate-based transactions. India's Aditya Birla, JSW Steel, Jindal Steel & Power and China's CITIC Resources Holdings were among interested parties looking at the company.

Australia's Aquila: Vale dispute cost 200,000/t in coal shipments

July 13, 2011. An ongoing marketing dispute between miners Vale and Aquila Resources has so far cost 200,000 tonnes in lost shipments of steel-making coal from the jointly-owned Isaac Plains mine in Australia.

The impasse comes after flooding in Australia's Queensland state coal belt earlier in 2011 had already hindered the mine's performance to reach its full production capacity of 2.8 million tonnes annually.

While production at the mine has continued and some individual sales have been completed, 50-50 owners Aquila and Vale have not been able to sell coal since November without the threat of either side taking legal action.

Policy / Performance

Japan to finance geothermal project in Indonesia

July 19, 2011. The Japanese government will provide 55 billion yen in loans to Indonesia to finance a geothermal power project in the country. Three Japanese companies, including Mitsubishi Heavy Industries Ltd., control 70 percent of the global market for geothermal plants.

U.S. nuclear chief urges rapid overhaul of rules

July 19, 2011. The top U.S. nuclear chief wants to push ahead with sweeping regulatory changes for nuclear safety, cutting through the exhaustive technical reviews that typically make for more lengthy deliberations at his agency.

Gregory Jaczko, chairman of the Nuclear Regulatory Commission said he wants the NRC to provide clear direction on changes warranted by Japan's Fukushima Daiichi within 90 days, and for the regulator and the industry to have changes implemented within five years.

Nuclear phaseout to hand Kremlin a win in Germany

July 19, 2011. Russian President Dmitry Medvedev goes to Germany to meet Chancellor Angela Merkel with a stronger hand than ever to win a long-held aim: closer access to consumers in the biggest market for Russian gas.

The host nation is Russia's third-largest trading partner and the biggest buyer of Russian gas, but the relationship has intensified since Germany announced the phaseout of nuclear power by 2022, increasing its need for alternatives.

Gazprom, Russia's gas export monopoly and the world's largest gas company, announced exclusive talks with Germany's RWE for a joint venture in power generation, with an implied promise of fatter margins on its German sales.

Japanese nuclear-contaminated beef "sold in and around Tokyo"

July 18, 2011. Japan's second-biggest retailer said it had sold beef from cattle that ate nuclear-contaminated feed, the latest in a series of health scares from radiation leaking from a quake-crippled nuclear power plant.

Aeon Co said it had sold the contaminated beef at a store in Tokyo and at more than dozen stores in the surrounding area, as radiation continues to spill from the Fukushima nuclear power plant four months after the March 11 earthquake and tsunami. Aeon, which competes with top retail group Seven & I Holdings, said cattle from Fukushima prefecture were given animal feed originating from rice straw that exceeded the government's limits for radioactive cesium. Japan was now likely to ban shipments of beef, hugely popular in Japan, from around Fukushima.

Japan should nationalize its nuclear reactors, Former Kan adviser says

July 14, 2011. Japan should nationalize the operation of nuclear plants following the disaster at Tokyo Electric Power Co.’s Dai-Ichi station in Fukushima, a candidate to replace Prime Minister Naoto Kan said.

Mabuchi, 50, a former land and transport minister, is seen as a possible candidate to replace Kan when he steps down. Kan, 64, pledged to gradually phase out nuclear energy and last month said he’d resign and pass his responsibilities to a “younger generation” after making progress on containing the nuclear crisis. Kan will probably resign in August, Mabuchi said. The nuclear disaster at the Dai-Ichi plant began after a magnitude-9 earthquake and subsequent tsunami on March 11 cut power to reactors.

The world’s worst atomic accident in 25 years has displaced about 50,000 households after radiation leaked into the air, soil and sea. Mabuchi said Japan shouldn’t raise taxes to pay for rebuilding after the disasters, which the government estimates will cost around 16.9 trillion yen ($213 billion). Kan’s reconstruction panel proposed to raise some levies to avoid adding to the world’s largest public debt.

U.S. nuclear industry weighs costs of safety reforms

July 13, 2011. The U.S. nuclear industry's top cop will weigh major changes in how it regulates the country's 104 reactors after Japan's Fukushima disaster, a move that will help shape the future of the power source and could lead to significant cost increases. A task force report published has recommended the Nuclear Regulatory Commission look at a fundamental shift in how it plans for catastrophes like the earthquake and tsunami that hit Japan in March.

Japan utilities to seek final approvals for two restarted reactors

July 13, 2011. Two Japanese power companies said they will seek final approval for commercial operation of nuclear reactors that have been operating in a grey zone since their restart in March, aiming to lift uncertainty over their status as Japan grapples with potential power shortages.

Kansai Electric Power and Hokkaido Electric Power said they were preparing applications for last-stage inspections of reactors that had been shut for maintenance and restarted just days before the March 11 earthquake, which triggered a nuclear crisis at Tokyo Electric Power's Fukushima plant in northeast Japan. Nuclear reactors typically get formal approval for commercial operations about a month after restarting in test mode, during which time they can still generate and supply electricity normally, but the utilities delayed the process for fear that local authorities would object to final approval as the Fukushima crisis stirred worries over nuclear safety. Safety worries have also prevented the restart of any nuclear reactors off-line for routine maintenance since the March disaster, fuelling fears of a power crunch and raising the possibility that, as more reactors are taken down for checks, Japan could be completely without nuclear power by next spring. Nuclear reactors supplied about 30 percent of Japan's electricity before the Fukushima crisis.

Nuclear Village’ protester turns hero as Fukushima drives atomic backlash

July 13, 2011. Toshinobu Hatsui’s protest against construction of a nuclear power plant split friends and families in his hometown. After the biggest atomic accident in 25 years, resentment has turned to gratitude.

Opinion polls show more Japanese agree with Hatsui in demanding a future less reliant on atomic power, a pillar of energy policy for five decades. Getting what they want may depend on Prime Minister Naoto Kan surviving the backlash from the so-called “nuclear village” of politicians, bureaucrats and power utilities that promoted the industry’s rise. It’s an unfamiliar challenge for the nuclear industry, which before the March 11 Fukushima disaster provided about 30 percent of Japan’s electricity. The national energy policy called for that percentage to rise to 53 percent by 2030. After the magnitude-9 earthquake and tsunami knocked out cooling systems at Tokyo Electric Power Co.’s plant in northern Japan and caused three reactors to meltdown, Kan said Japan should abandon plans to build 14 new reactors by 2030. He wants to pass a bill to promote renewable energy and questioned whether private companies should be running atomic plants.

Japanese PM Kan wants to wean Japan from nuclear power

July 13, 2011. Japanese Prime Minister Naoto Kan said the Fukushima nuclear crisis had convinced him that Japan should wean itself from nuclear power and eventually have no atomic plants. The radiation crisis at Tokyo Electric Power Co's Fukushima plant, triggered by the March 11 earthquake and tsunami, has sparked debate about the role of nuclear power in quake-prone, resource-poor Japan, as well as concerns about power shortages with 35 of the nation's 54 reactors now halted.

Renewable Energy / Climate Change Trends


OPIC to invest up to $820 mn in India's renewable energy sector

July 19, 2011. US government-owned financial entity Overseas Private Investment Corp (OPIC) plans to invest up to $820 million (about ` 36 bn) in the fast- growing Indian renewable energy sector by the end of 2011. As part of efforts to boost clean energy initiatives, OPIC will make investments to the tune of $520 million in India's renewable energy sector, including the solar segment.

Govt to invite bids for ` 30 bn solar power projects in August

July 19, 2011. The government will invite bids for ` 3,000-crore solar power projects with a capacity of 300 mw under the National Solar Mission in the first week of August. The projects would be awarded by the end of this year and the power purchase agreements would be signed in January 2012. In the first round of bidding, the government had awarded 30 solar photovoltaic (pv) projects of 5 mw each having a total capacity of 150 mw and seven solar thermal projects of 470 mw. It had received applications for developing 1,740 mw of PV projects, compared to the target of 150 mw in the first batch of Phase-I. For solar thermal, it received applications for developing 1,000 mw, against 500 mw.

The government is looking to increase the size of the projects from 5 mw and may allot higher capacity to the project developers. Currently, companies not being able to arrange the funding by a stipulated date must forfeit their permits and bank guarantees. The government is mulling to tweak this by bringing in the condition of imposing a partial penalty in such condition and give more time to developers to arrange funding for the projects. Instead of forfeiture of bank guarantees, the government wants to provide slight leeway to companies to arrange funding during the construction of the project. The MNRE may get the approval for the changes to be made in the guidelines by the end of this month.

Nearly 200 MW of wind energy coming up in Tamil Nadu, Gujarat

July 18, 2011. In order to meet a portion of India's huge energy requirement, a leading EPC in power sector is setting up two major wind-based generating and transmitting units of 115 MW and 75 MW each in Tamil Nadu and Gujarat at cost of ` 1,000 crore. Stating this, Techno Electric and Engineering Company Limited (TEECL) said while the commissioning of the 115 mw project near Rameswaram in Tamil Nadu was scheduled to be completed by September with the completion of the last phase of 30 mw unit, work for the 75 MW unit near Kutch in Gujarat in two phases would begin in October. While the Tamil Nadu project would cost the state exchequer ` 675 crore, about ` 450 crore would be spent for the Gujarat project within the next 12 to 16 months. The entire technology for commissioning of both the projects was developed by TEECL, while the equipment for wind power were being supplied by Suzlon,one of the largest global players in that segment.

FE Clean Energy to invest $40 mn in NRPPL

July 18, 2011. FE Clean Energy Group, a Connecticut-based PE firm will be investing $40 million in NSL Renewable Power Private Limited (NRPPL), part of city- based NSL Group. NRPPL will use the funds to meet equity commitments for its various wind, hydro and solar power projects being developed in various parts of the country.

The company has about 162 MW of installed capacity in renewable energy, comprising of 150 MW of wind power (including a 50MW wind farm which is expected to be commissioned later this month) and two bio-mass plants of 6 MW each. NRPPL is also constructing two medium scale hydro power projects (100 MW and 44 MW) and two small scale hydro power projects (5 MW and 6 MW) in Himachal Pradesh. The company has recently entered into solar power generation and is currently constructing a 20MW solar power project in Gujarat, which is expected to be commissioned by December 2011. NRPPL also has seven winds power project under development totalling over 700 MW, which will be implemented over the next 2-3 years.

Suzlon gets 100 MW order from OGPL for ` 6.5 bn

July 15, 2011. Suzlon Energy Limited, the world's fifth largest wind turbine manufacturer, has won an order from Chennai-based Orient Green Power Company Limited (OGPL), for over 100 megawatts (MW) of wind power projects for ` 650 crore These projects are scheduled to be commissioned by June 2012; with 50.4 MW of capacity coming online in Gujarat by May 2012, and the remaining 50.4 MW in Karnataka by June 2012. Orient Green Power Company Limited, is the country's largest diversified, independent renewable energy company, with a primary focus on wind energy and over 198 MW of wind assets already operational. It is focused on creating a sustainable portfolio of renewable energy assets comprising of primarily wind, biomass and hydro-power.

Solar energy being promoted in Manipur

July 15, 2011. In an endeavor to promote the usage of solar energy, the Manipur Renewable Energy Development Agency (MANIREDA) has set a target for providing 10,000 solar water heaters under the Jawaharlal Nehru National Solar Energy Mission. The agency recently organized a one-day workshop on solar thermal system that laid stress on the need to use solar and wind energy to meet the power shortage in the region. MANIREDA aims to set up solar water heaters, lights, cells, biogas plants and windmills in the region in pursuit of this goal. The heaters that have a capacity of 100 litre per day, cost around 25,000 each, 75 per cent of which will be provided by central and state subsidy. This will help save 75-megawatts of power and prevent carbon emission of 1.5 tonnes in a five-year period.It also aims to spread awareness among people about the benefits of renewable energy. MANIREDA is the nodal agency for formulating policies and programmes, for popularising the applications of various non-conventional and renewable source of energy in Manipur. The agency has set up biogas plants, distributed solar cells, lighting systems, wind-solar hybrid energy system in villages of the hill districts of Manipur where electricity has not reached. Under Manireda, a 200 KW solar power plant was set up recently at Moreh, 165-gram panchayats were electrified and 5736 solar street lighting sets with a capacity of 444 Kilowatts were distributed. MANIREDA not only helps in setting up the solar plants but also trains villagers in preventive maintenance of these installations.


Japan to build solar energy plant in Egypt

July 19, 2011. The Japan International Cooperation Agency (JICA) has announced plans to provide Egypt with a new solar power plant in Borg al-Arab, a city south west of Alexandria. Japan will finance $11 million as part of a plan the JICA representative in charge, Takahiro Goto, calls a “grant aid project”. The plant is expected to have a power generating capacity of 420 kilowatts and produce 641,000kw of power once it is fully operation in 2012.

Paradigm Change Capital Forms Group to promote low carbon bonds

July 19, 2011. Paradigm Change Capital Partners LLP formed a group with the European Investment Bank and five others to promote the low carbon bond market. The Low Carbon Bond Group initiative aims to “smooth the way” for the bonds and expand a new market. Such bonds could cover clean energy and energy-efficiency projects, like so-called green bonds, and resources including water or forests. Governments and the private sector are looking to mobilize the debt capital markets to help bridge the gap in funding for clean energy. The U.K.-funded Green Investment Bank, set to start operations in 2012, may include bonds as a way to fund such projects. The new group, created on July 15, also includes Moody’s Corp., KPMG LLP, Clifford Chance LLP, Norton Rose LLP and the International Investors Group on Climate Change, a forum of European pension funds and asset managers.

UAW, other unions support tougher fuel standards

July 19 2011. A coalition of eight unions and environmental groups, including the United Auto Workers (UAW), asked President Barack Obama to push for higher fuel-economy standards for light-duty vehicles.The BlueGreen Alliance, a national partnership between labor unions and environmental organizations, said in a letter to Obama that it strongly supports his efforts to create new fuel-efficiency and greenhouse gas emissions standards for light-duty vehicles sold in model years 2017-2025.

Higher gas prices and a still-shaky economic recovery -- paired with competition from foreign automakers -- have left U.S. companies and trade groups looking for new ways to support their members. The United States sends about $1 billion per day to foreign countries to pay for oil, according to the letter. Higher fuel economy standards could be a relief to consumers and also create jobs for workers to redesign vehicles and retool factories. The changes could also pinch automakers' margins. The UAW, which is concerned about protecting union jobs, hosted executives from the big U.S. automakers last week to discuss future standards.

The U.S. government has been meeting regularly to consider options for new corporate average fuel efficiency (CAFE) standards for 2017 through 2025. Regulators are considering lifting CAFE standards to 56.2 miles per gallon for the 2017 to 2025 time period. The Obama administration has publicly said it is targeting a range between 47 mpg and 62 mpg.

BP-backed energy group spends $38 mn on U.K. carbon capture

July 19, 2011. The Energy Technologies Institute (ETI), backed by Royal Dutch Shell Plc, BP Plc and the U.K. government, agreed to invest 23.5 million pounds ($38 million) in a carbon- capture trial project as Britain studies ways to curb emissions. The ETI will work with U.K. engineering company Costain Group Plc to construct a pilot plant at a coal-fired power station to capture as much as 95 percent of its carbon dioxide output. It aims to have the facility built, operated and tested by mid-2015.

Britain, due to shut more than 11,000 megawatts of coal and oil-fed power capacity by the end of 2015, is examining ways to meet energy demand while reducing emissions. Energy and Climate Change Secretary Chris Huhne outlined proposals for Electricity Market Reform, which include imposing an emissions limit of 450 grams of carbon dioxide per kilowatt-hour on new power stations, aimed at preventing the construction of coal-fed plants without carbon capture and storage, or CCS. CCS technology gathers carbon dioxide that’s released in power generation and stores it underground.

Russia offers Germany gas, rare earths to nudge China

July 19, 2011. Russia offered Germany long-term deals for natural gas and rare earths, putting pressure on China, which currently dominates the rare earths market, to end delays in agreeing to imports of Russian gas. China controls 97 percent of the global supply of rare earth minerals -- used heavily in Germany's electronics industry -- and Russian President Dmitry Medvedev opened the door to German investment to exploit Russia's untapped reserves of the elements.

European solar sector feels heat from China

July 19, 2011. A $1.2 billion write-down by solar equipment maker REC highlighted the pain being inflicted by aggressive Chinese competition and may herald wider consolidation in the sector and flattening of prices. REC produces equipment across the supply chain from slices of raw, solar-grade silicon, called wafers, to finished solar panels.

GM tests plan to monitor power usage in Chevy Volt

July 19, 2011. General Motors and OnStar are launching a program to send data instantly from Chevrolet Volts back to the power grid so utilities can better manage their energy demands. The program uses the Volts' OnStar system to monitor a vehicle's battery charge. Utilities could then better balance demand and offer incentives to electric vehicle owners who charge their vehicles during off-peak hours. The program will include hundreds of Volts leased by General Electric for its employees.

Off-Grid solar energy market in africa growing, Energiebau Says

July 19, 2011. Energiebau Solarstromsysteme GmbH, a Cologne, Germany-based developer of small-scale solar systems, said the number of installations it is doing in Africa is increasing by about 10 percent a year.

The falling price of photovoltaic panels is making solar a more affordable source of power for Africans though the market needs five more years before a local PV panel manufacturing plant is warranted. In places like Ghana and Kenya, solar power is now cheaper per kilowatt-hour than a diesel generator.

About 5 percent of the company’s business comes from Africa and is growing, Schaefer said. In 2006, Energiebau founded a subsidiary in Ghana and another in Mali to supply small, off- grid systems to remote areas. It will open another unit in Kenya before the end of the year. Germany’s Schott Solar AG and SMA Solar Technology AG are Energiebau’s main equipment suppliers. Lower cost products are sourced from Korean panel-maker Solar Park.

German and other European companies have the strongest presence in Africa at present because Europe is the most experienced in PV. Energiebau has installed more than 100 units in African countries including Tanzania, Kenya, Zambia and Uganda. Its largest project is a 515-kilowatt installation at the headquarters of the United Nations Environment Program in Kenya. It has bid to develop a 2-megawatt on-grid project in Ghana.

China to start carbon emissions trading trials

July 18, 2011. China will start trials of carbon emission trading and gradually set up a carbon emissions trading market. The government will also accelerate the building of an energy saving and environmental protection system, and tighten regulations for identifying and labeling low-carbon products.

Gas Natural says in talks to buy ACS's wind parks

July 18, 2011. Spanish utility Gas Natural said it was in talks with builder ACS to buy more of its wind parks. Gas Natural signed a deal to buy a small package of wind farms from ACS, which is selling off non-core assets to focus on its attempts to increase its stake in power firm Iberdrola. Gas Natural, which is seeking to balance its gas-focused generation mix with more renewables, is the favorite to acquire a 560 megawatt package of wind parks, for which it is prepared to pay about 600 million euros ($850 million).

Deeper EU climate target not out of reach

July 18, 2011. The increasing importance of climate spending in European Union budget proposals could give the EU Commission more influence over talks for a deeper emissions cut target, which could help lift EU carbon permit prices.

Prices for carbon permits traded under the EU's emissions trading scheme have fallen nearly 30 percent over the past six weeks due to concerns about the eurozone economy and over-supply of permits. Some market participants are keenly awaiting any news which would help push prices higher. The EU Commission has been pushing to tighten its emissions cut target for 2020 to 30 percent from 1990 levels from the current 20 percent.

Poland has stalled debate on the issue, mainly because it is very reliant on coal for electricity and a tougher target would prove very costly. But hopes have not faded completely because, given the increasing importance of climate spending in the EU budget, the EU Commission might be more influential over discussions around deepening the target. The EU Commission's climate department said that under current proposals for a seven-year EU budget from 2014 to 2020, around 25 percent or 200 billion euros ($282 billion) would be spent on climate-related projects. EU governments and the EU Parliament willl vote on plans for bigger spending this October.

Eco Sustainable gets planning permission for U.K. biomass plant

July 18, 2011. Eco Sustainable Solutions Ltd., a U.K. waste recycler, gained planning permission for a 12 million pound ($19 million) biomass plant, the first in Dorset. Construction will begin by November and the facility will be commissioned by early 2013.

The 3-megawatt plant will provide power for 5,000 homes. About 7-megawatts of heat will dry wood for the company’s animal bedding business. European Union targets have committed the U.K. to derive 15 percent of its energy from renewable sources by 2020.

According to the Department for Energy and Climate Change, at least 30 percent of the figure could be met by biomass. Dorset council took four years to approve planning permission.

Australia voters hostile to carbon policy, PM - new poll

July 18, 2011. A major new Australian opinion poll has given another emphatic thumbs-down to Prime Minister Julia Gillard and her recently unveiled carbon-reduction plan, stoking media speculation about her grip on power and the fate of the policy.

China to pilot carbon emission exchange

July 17, 2011. China will pilot a carbon trading scheme and gradually build a market for emissions trading to meet pollution goals and fight climate change. To get the scheme going, Beijing will widen the difference in electricity tariffs between power-intensive sectors and other industries. Beijing would also improve laws, regulation and taxation policies to encourage energy conservation, and ask financial groups to fund low-carbon emission projects. Development of industries such as services, renewable energy and information technology would be welcomed by Beijing, while excessive growth in power-intensive sectors would be discouraged. Companies and governments around the world are turning to emissions trading as a way to combat climate change and join a world carbon market worth $142 billion. China would pilot six emissions trading schemes by 2013, and set up a national trading platform by 2015.

Germany's NRW says E.ON compromise possible

July 17, 2011. Germany's North Rhine Westphalia regional government said it was possible to reach a compromise with utility E.ON on its coal plants in Datteln. E.ON is locked in a conflict with North Rhine Westphalia regarding the hard coal power plant in Datteln, which is to be switched off at the end of 2012.

Israel aims to generate 10 pc of electricity with renewable energy

July 17, 2011. The Israeli Cabinet approved a plan to generate 10 percent of the country’s electricity using renewable energy sources by 2020.

African Development Bank, Denmark set up $57 mn energy fund

July 17, 2011. The African Development Bank signed an agreement with Denmark to establish a 300-million Danish krone ($57 million) sustainable energy fund for Africa.

House votes to save traditional incandescent bulb for 2012

July 16, 2011. The U.S. House approved a provision to save for a year the 100-watt incandescent light bulb, which has become a pear-shaped symbol of personal freedom to some Republicans. Lawmakers passed on a voice vote an amendment to energy- spending legislation for fiscal year 2012 barring the Energy Department from implementing or enforcing lighting-efficiency standards set by 2007 legislation. The law would effectively push the traditional bulbs off store shelves, starting with the 100-watt version next year.

BHP shale buy shows industry shrugs off green fears

July 15 2011. BHP Billiton's $12.1 billion agreed takeover of U.S. shale gas producer Petrohawk Energy Corp shows environmental concerns and weak margins have not cooled interest in this controversial energy source.

Elia joins Marubeni, Google in backing Atlantic wind project

July 15, 2011. Elia System Operator NV, Europe’s fourth largest electric-grid operator, is investing in a $5.5 billion power transmission project off the U.S. Atlantic coast that will link 6,000 megawatts of offshore wind farms. The undersea power lines off the coasts of New Jersey, Delaware, Maryland and Virginia will be developed in five segments. The company acquired a 10 percent stake in the first segment and 5 percent of the remaining segments, without saying how much it invested. Tokyo-based trading company Marubeni Corp. and Zug, Switzerland-based clean energy investor Good Energies are also backing the project, and Google Inc. is providing 42 percent of the pre-construction equity. The Federal Energy Regulatory Commission in May granted a 12.6 percent return on equity for the project, less than the 13.6 percent sought by the developers.

Lufthansa begins world’s first regular biofuel passenger flights

July 15, 2011. Deutsche Lufthansa AG, Europe’s second-largest airline, became the first carrier in the world to offer regular scheduled flights running on biofuel, with four daily round trips between Hamburg and Frankfurt. The airline will use a biofuel blend using 50 percent so- called hydrotreated renewable jet fuel. The fuel is made from feedstocks including inedible plants and wood chips. Lufthansa will fly an Airbus A321 on the services. Air France-KLM Group, Europe’s biggest airline, operated the world’s first commercial biofuel flight, using a blend of recycled cooking oil to drive a Boeing Co. 737-800. Finnair OYJ plans to test planes between Amsterdam and Helsinki. Airlines won approval in June to power planes with blends including biofuels made from algae to organic waste from the U.S. standards body ASTM International. The International Air Transport Association industry group set a target in 2007 to eliminate carbon dioxide emissions from air travel by 2050. Other airlines that have run test flights with biofuels or begun exploring their use include United Continental Holdings Inc., Japan Airlines Co., Virgin Atlantic Airways Ltd., Qatar Airways and Qantas Airways Ltd.

Boone Pickens challenges Canada on green power law

July 15, 2011. Mesa Power Group, a Texas-based renewable energy company owned by billionaire T. Boone Pickens, plans to file a complaint with Canada charging that the province of Ontario's green energy plan violates the North American Free Trade Agreement.

Vast wind energy proposal could kill endangered birds

July 15, 2011. The Obama administration is evaluating a plan to allow a 200-mile corridor for wind energy development from Canada to the Gulf of Mexico that would allow for killing endangered whooping cranes. The government's environmental review will consider a permit sought by 19 energy developers that would permit turbines and transmission lines on non-federal lands in nine states from Montana to the Texas coast, overlapping with the migratory route of the cranes.

U.S. says China's new rare earth quotas troubling

July 15, 2011. China's new, more restrictive quota on exports of rare earths used in a variety of high-technology products are a step in the wrong direction.

Panasonic may build energy-saving homes on ex-factory sites after quakes

July 15, 2011. Panasonic Corp. may build homes in Japan with power-saving devices on sites of factories it closed as the appliance maker looks to tap demand for energy-efficient products after the March 11 earthquake. Homes in so-called smart towns, where Panasonic plans to sell to consumers directly, may include solar panels, energy- efficient refrigerators and rechargeable batteries.

AEP halts carbon capture plan due climate inaction

July 15, 2011. American Electric Power Co Inc shelved plans to capture heat-trapping carbon dioxide emissions from a coal-burning power plant in West Virginia, citing a lack of action by the U.S. Congress. he move by Ohio-based AEP is a blow to U.S. efforts to rein in carbon dioxide emissions from coal plants using carbon capture and storage, or CCS, which experts see as the most viable way of limiting emissions from existing plants.

EDP Renewables H1 wind power output rises 27 pc

July 15, 2011. EDP Renewables, the wind energy subsidiary of Energias de Portugal, said its power generation rose by 27 percent in the first half of 2011, helped mainly by output growth in the United States. EDPR, the world's fourth-largest wind energy company in terms of installed capacity, said total power generation rose to 8,790 gigawatt hours (GWh), while its U.S. output jumped by 39 percent from a year earlier to 5,105 GWh largely thanks to capacity additions.

EU disappointed by China rare earth quotas

July 14, 2011. The European Union was disappointed at Beijing's new rare earth quota announced, which did not change amounts allowed for export to Europe. In fact China had added ferro-alloys to the quota, which in practical terms results in a tightening of the limits. China issued a batch of quotas for exports of rare earths this year -- during a visit to Beijing by the EU's trade negotiator, and just a week after the World Trade Organization ruled against its curbs on a different mix of raw materials.

The WTO's ruling that China had breached trade law by limiting foreign sales of eight raw materials led Europe and the United States to say that meant Beijing should also be forced to increase exports of 17 rare earths. China accounts for some 97 percent of global output of rare earth minerals crucial to global electronics, defense and renewable energy industries, and its export quotas have choked off global supplies, boosted prices and angered China's trading partners.

Mitsubishi Chemical, PTT to start bio-plastic joint venture in Thailand

July 14, 2011. Mitsubishi Chemical Corp. and Thailand’s PTT Pcl (PTT) plan to jointly invest 7 billion baht ($232 million) in a bio-plastic venture that will start production in late 2014. PTT MCC Biochem Co. will produce plastic from sugar. PTT and Mitsubishi will each hold a 50 percent stake in the venture. Construction of the plant will start next year.

Canadian Solar targets '12 module shipments above 2 GW

July 13, 2011. Canadian Solar Inc is aiming to ship more than 2 gigawatts of solar modules in 2012, a target that would represent a 60 percent increase from the midpoint of its 2011 forecast. The company's production last year of more than 800 MW, had put Canadian Solar among the top six largest module manufacturers. He confirmed that the company was planning on shipping 1.2 GW to 1.3 GW of modules this year. Ontario, Canada-based Canadian Solar has most of its manufacturing in China.

Suzlon’s Repower may bid for 10 bn-euro France wind project

July 13, 2011. Repower Systems SE, the German unit of Suzlon Energy Ltd., is in talks with partners to bid for a 10 billion-euro project in France to build offshore wind farms.

Heatstroke deaths quadruple as Japan shuns air conditioners to save power

July 13, 2011. Deaths from heatstroke in Japan quadrupled in the early part of summer as temperatures rose and air conditioners were switched off in line with government appeals to curb electricity usage to avoid power blackouts. From June 1 to July 10, the latest period available, 26 people died from heatstroke, compared with six in the same period last year. The number of people taken by ambulance to hospitals for heatstroke more than tripled to 12,973, with 48 percent in the most-at-risk group aged 65 years or older. Temperatures in eastern Japan, including Tokyo, were 3.8 degrees higher than the 30-year average in the last 10 days of June or the highest since at least 1961. The average temperature in Tokyo in the 10 days was 26.4 degrees Celsius, and temperatures in coming weeks are forecast to be above average.

Utilities ‘shot themselves in the foot’ over early carbon sales

July 13, 2011. European utilities pushed down the prices for carbon and power as well as the value of their shares when they sought early supply of hundreds of millions of tons of emission permits for the phase starting in 2013. The European Commission has said it might supply about 420 million tons of post-2012 allowances through next year in sales that may start as early as this year.

Spain’s first wave power plant on grid opens with Voith tech

July 13, 2011. Spain’s first grid-connected wave power project has been commissioned by Ente Vasco de Energia, energy agency of the northern Basque region. The 2.3 million-euro ($3.3 million) project in Mutriku was developed by the agency using funds from the regional government and technology from a Siemens AG and Voith GmbH venture. The 296- kilowatt plant, which began operating, is continental Europe’s first to supply power to users on the grid. Spain, along with the U.K., is seeking to harness energy from waves and tides along its Atlantic coastline. A total of 26 marine energy projects are being developed in the country with a combined value of 236 million euros. Spain plans 100 megawatts in marine energy capacity by 2020. The Mutriku plant uses oscillating water column technology, in which turbines are attached to a breakwater to generate power as air is pressurized and de-pressurized by waves. Voith Hydro, a venture between Voith and Siemens, provided the 16 turbines. The commercial plant will generate enough energy to power 250 average homes. Voith Hydro operates smaller plants with the technology in Scotland and Portugal. The European Commission provided 200,000 euros for the Mutriku project under its so-called sixth framework program for research and technological development.

Big-name brands sourcing from polluting China firms

July 13, 2011. Some of the world's leading clothing brands rely on Chinese suppliers that pollute rivers with toxic, hormone-disrupting chemicals banned in Europe and elsewhere, environment group Greenpeace said. Adidas, Nike, Puma, Calvin Klein, Lacoste, Abercrombie and Fitch and China's Li Ning were among the global names identified in the Greenpeace report, following a year-long investigation. The report focused on two major Chinese suppliers, the Youngor Textile Complex in Ningbo on the Yangtze River Delta and the Well Dyeing Factory in the Pearl River Delta near Hong Kong. All the brands mentioned in the report have confirmed they source products from one of the two Chinese suppliers, Greenpeace said. Greenpeace's Li Yifang said China had yet to implement a systematic chemicals management policy, but responsibility must also lie with global firms outsourcing to China to cut costs.

As CO2 levels rise, land becomes less able to curb warming

July 13, 2011. Wetlands, forests and farmlands soak up large amounts of carbon dioxide but rising amounts of the gas in the atmosphere mean these carbon "sinks" could become less effective at fighting climate change. Scientists say land ecosystems are an essential brake on the pace of climate change because plants soak up large amounts of carbon dioxide (CO2) as they grow. This also boosts the level of carbon in soils.

Japan may miss greenhouse gas targets if all nuclear plants shut

July 13, 2011. Japan’s greenhouse gas emissions may rise by as much as 16 percent from 1990 levels should the country’s nuclear reactors be shut down, raising questions about its ability to meet carbon-dioxide reduction targets. C02 emissions will increase by as much 210 million metric tons in the year to March 2013 should all reactors be closed and replaced by thermal plants, Yusuke Nakamura, a deputy director at the low-carbon society promotion office in Japan’s Environment Ministry, said. That would translate into an increase of as much as 16 percent in greenhouse gas emissions from 1990 for the year ending March 2013, he said. Under the Kyoto Protocol signed in 1997, Japan committed to reducing the gases responsible for global warming to 6 percent less than 1990 levels by 2012. The figure was calculated by the ministry in response to a question from a member of parliament and doesn’t take into account power-saving measures introduced after the March 11 earthquake and tsunami knocked out power plants in Japan. About two-thirds of Japan’s 54 reactors have been shut down after the quake and tsunami caused the Fukushima nuclear crisis or because of regular checks. Japan may have no nuclear reactors running by May next year if the round of tests the government is planning cause further delays in restarting units idled for maintenance. Japan’s greenhouse gas emissions for the year ended March 2010 totaled 1.209 billion metric tons, the latest figure available, the ministry said in April.

Pakistan set to approve $1 bn plan to boost wind energy production

July 13, 2011. Pakistan is ready to approve a Norwegian company’s request to build a 150-megawatt wind farm, the first part of a $1 billion plan that could boost by a third the announced capacity for clean-energy power plants. Pakistan is seeking to diversify its energy supplies away from oil and gas and boost electricity production. The nation has a power deficit of 3.6 gigawatts a day, or more than the output of two nuclear reactors, triggering 12-hour blackouts that cause riots and close factories in cities nationwide. The Alternative Energy Development Board is willing to allow a project proposed by NBT AS, a Lysaker-based clean energy company that plans to build the facility in the Sindh province “wind corridor” north of Karachi. Pakistan has almost 1 gigawatt of projects under construction or with financing agreed and 498.5 megawatts more of wind programs announced. Only 6 megawatts of wind energy facilities are operating in the nation. It’s the ninth-poorest in the Asia- Pacific region with a 2009 gross domestic product per capita of $2,609.

Cisco joins Schneider to improve energy efficiency in buildings

July 13, 2011. Cisco Systems Inc., the largest network-equipment company, joined forces with Schneider Electric SA to provide technology to reduce the amount of energy wasted by IT, lighting and security systems. The technology offers the potential to cut IT costs by as much as 30 percent and overall building costs by about 9 percent. Buildings account for as much as 42 percent of energy consumption worldwide.

Dear Reader,


You may have received complimentary copies of the ORF Energy News Monitor. Our objective in bringing out the newsletter is to provide a platform for focused debate on India’s energy future. You could be a partner in this effort by becoming a subscriber. You could also contribute recommendations for India’s energy future in the form of brief insightful articles.


We look forward to receiving your patronage and support.


ORF Centre for Resources Management


              ORF ENERGY           

            NEWS MONITOR


Sponsorship Form

Please fill in BLOCK LETTERS

·    Commercial Sponsorship: Rs 15, 000 per annum

   1 hard copy (52 issues) + soft copies by email as per list provided by  sponsor

·    Non Commercial/ Academic Sponsorship: Rs 2, 500 per annum              

1 hard copy (52 issues) + soft copies by email as per list provided by  sponsor

·    Individual Sponsorship: Rs 1, 000 per annum   

    Soft copy only

Yes! I/we would like to receive copies of the weekly ORF Energy News Monitor for a period of ______year(s).  I/we shall be entitled to one hard copy along with the option of soft copies to a list of e-mail addresses provided by me/us for the period specified. 


Please find enclosed cheque/Bank Draft No.........................dated …………………drawn at New Delhi for Rs.........……….favouring ‘Observer Research Foundation

Please fill in this form and mail it with your remittance to


Mr. Vinod Kumar Tomar  

ORF Centre for Resources Management 


20 Rouse Avenue,

New Delhi - 110 002

Phone +91.11.4352 0020 extn 2120

Mobile: 9871417327

Fax: +91.11.4352 0003

E-mail: [email protected], [email protected]


Registered with the Registrar of News Paper for India under No. DELENG / 2004 / 13485


Published on behalf of Observer Research Foundation, 20 Rouse Avenue, New Delhi–110 002 and printed at Times Press, 910 Jatwara Street, Daryaganj, New Delhi–110 002.


Disclaimer: Information in this newsletter is for educational purposes only and has been compiled, adapted and edited from reliable sources. ORF does not accept any liability for errors therein. News material belongs to respective owners and is provided here for wider dissemination only.  Sources will be provided on request.


Publisher: Baljit Kapoor                                    Editor: Lydia Powell

Production team: Akhilesh Sati, Vinod Kumar Tomar

The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.