Discoms have moved a petition before the Madhya Pradesh Electricity Regulatory Commission and sought that they should be allowed to recover around ₹250 bn losses that were incurred during past four years till 2017-18, from the consumers by hiking tariff. Besides, these discoms in their ARR filed for year 2020-21 have also sought an increase of 5 percent in power tariff to bridge the estimated revenue gap of ₹20 bn for that financial year. The government is resisting power tariff increases. The discoms in Haryana have decided to continue with the FSA component in the power bills. UHBVN has issued a circular to the subdivision offices to ensure that the FSA component be continued till further orders. The FSA component will be 37 paisa per unit in the electricity bill. The DHBVN, which caters to the electricity distribution to southern Haryana, will follow suit. As per records, both discoms have 6.621 mn electricity consumers in all categories across Haryana. It includes 3.069 mn consumers of UHBVN and 3.552 mn consumers of DHBVN. Last year, after the distribution companies had started showing profits, the government had announced to bring down the electricity tariff by waiving the FSA factor. The electricity regulator too had been asking the distribution companies to discontinue the FSA in electricity bills. Another hike in power charges is on the cards in Punjab as the state electricity regulatory commission is all set to give a verdict on a petition filed by the state discom to seek a revision in tariffs. The PSPCL, in its petition before the Punjab State Electricity Regulatory Commission, sought an increase in charges as the Supreme Court recently ordered the discom to pay Nabha Power Ltd and Talwandi Sabo Power Ltd coal charges worth over ₹14.20 bn. The PSPCL has said in the petition that these are expenditures incurred in terms of the provisions of PPAs as has been interpreted by the Supreme Court and are legitimate expenditures. When allowed, the state consumers will have to pay ₹120 bn more for power consumed in the next 21 years. The Delhi High Court has held that the cost incurred by power discoms can be considered while fixing tariff and it would include salaries, allowances and pension of their employees. The ruling came while dismissing a PIL which had alleged that power regulator Delhi Electricity Regulatory Commission had allowed collection of more than ₹30 bn since 2011 towards a government pension fund from consumers through their electricity bills without informing them. It also dismissed a PIL initiated by the court on its own based on a letter by a Federation of the Resident Welfare Associations of Yamuna Vihar in north-east Delhi, opposing a 3.8 percent surcharge added to the power bills of BSES and BYPL consumers towards pension of erstwhile Delhi Vidyut Board employees. Nagaland state’s electricity sector has for years been returning widening revenue-purchase gap. A variety of reasons, mostly local in nature, ranging from state governmental apathy and aging power infrastructure to pilferage and inconsistent revenue collection have been recurring themes, while yearly tariff hikes has not been of much help. Talking of tariff, energy cost in Nagaland has steadily increased during the past decade with a marked jump observed in the revised tariff schedule for 2019-20. The hike averaged 39 paise in the Domestic category, the steepest since 2012-13 when an average hike of 45 paise was affected. Per kWh cost has increased by over 54 percent, roughly corresponding to Rs2/kWh during 2011-12 to 2019-20 in the ‘Domestic’ category, which comprises most urban consumers. While a steady rise of ₹2 in 9 years may not seem much, an independent assessment of the prevailing tariffs in the Domestic category across India points to Nagaland being among the states with the highest electricity retail rate. It places Nagaland in number 9 in the top 10 states with the highest tariffs currently. Along with Assam and Tripura, it is one among 3 north east states figuring in the top 10. As per the estimation, Bihar ranked 1st followed by Maharashtra (excluding Mumbai), Karnataka, Assam, Jharkhand, West Bengal (excluding Kolkata), Punjab, Tripura, Nagaland and Rajasthan. Mandatory charges were not considered. Jharkhand applies a single or flat fixed rate irrespective of the quantum of consumption. Going by the Nagaland 2019-20 tariff chart, consumption of 300 units a month in the Domestic category would translate into ₹1763, excluding the charges for public lighting and meter. The ‘Domestic’ category makes up 47.5 percent of the total 287,000 metered consumers, as per the Department of Power, Nagaland 2018-19 data. The latest data for 2019-20, estimates the total consumers at 330,000 with the Domestic category, including Below Poverty Line consumers, making up a little over 300,000 of the total. More than 86 percent of the domestic power consumers in the Madhya Pradesh have now come under the IGJY, paying ₹1/kWh of electricity. The total number of domestic consumers in the state is 11,697, 880. Keeping the promise made in its manifesto, the state government introduced the IGJY in February for domestic consumers, who used up to 100 kWh per month. Under the scheme, consumers using up to 100 kWh of power had to pay only ₹100. In September, the state cabinet extended the benefits to consumers, who used up to 150 units of power. It was implemented October onwards. In June-July 2018, the erstwhile government had waived power bill dues of the unorganized sector labourers and offered electricity at a flat rate of ₹200. In November, the number of beneficiaries of the IGJY increased by another 345,000 consumers. In October, with more than 9.7 million beneficiaries, the state government had estimated that the subsidy scheme will cost ₹3,400 per annum to the exchequer. However, as the number of beneficiaries go beyond 10 mn, the cost could escalate to ₹40 bn. The Kolhapur unit of the Maharashtra State Electricity Distribution Company Ltd said that all the defected distribution transformers that were affected due to floods have been fixed. There were as many as 7,602 transformers, of which, more than 2,000 were not fixed until the first week of November owing to the monsoon. However, they have now been repaired. If still inadvertently any farmer’s electricity connection is yet to be restored, they can contact on 7875769103 and report the same. The complaint will be addressed on an urgent basis. Earlier in August, floods caused a blackout for over 338,000 electricity consumers across urban and rural areas of Kolhapur and Sangli districts. Supply to around 323,000 consumers was resumed as floodwater receded by the end of August. However, for the remaining connections, especially agriculture pumps, continuous rainfall and muddy terrain near river banks proved to be a hindrance. In many areas across the district, electricity poles were uprooted or washed away in the floods. The floods had caused an estimated loss of around ₹490 mn and ₹470 mn in Kolhapur and Sangli districts respectively. Over 7,000 transformers were affected due to the floods while 42 sub-stations had to be shut down.
India has installed power generation capacity of around 365 GW, double the peak demand. The peak-time power demand in India fell 4 percent in November led by an ongoing economic slowdown and early onset of the winter season, according to IEX the country’s largest online power trading platform. It said that “energy met” at 3.3 bn units declined 5 percent on a year-on-year basis. November 2019 witnessed a 20 percent decline in average price of power traded through Day-Ahead contracts at the spot exchange at ₹2.85/kWh as compared to ₹3.58/kWh in the same month last year. Overall, the platform saw a 7 percent rise in power trade volumes in November at 3,825 mn units. According to the IEX, the overall 7 percent increase in traded volumes during the month was attributed to higher procurement by Eastern and Southern states and demonstrates the consumers’ preference for the platform. In October, the country’s power demand fell 13.2 percent from a year ago, its steepest monthly decline in more than 12 years, as a growth slowdown in Asia’s third-largest economy deepened. Electricity demand fell to 94.60 bn kWh in November, from 98.84 bn kWh during the same period last year, data compiled by the CEA showed. For the eight months ending 30 November, India’s electricity demand was up 1.2 percent, the CEA said. Demand rose 6.4 percent during the eight months ended 30 November 2018. India’s most industrialized and electricity hungry state of Maharashtra saw demand fall 8.1 percent, the data showed. Demand from large states such as the central Madhya Pradesh fell 13.9 percent, while power requirement from the north western state of Rajasthan fell 5.7 percent. Delhi’s peak power demand this winter season can go up to 4,700 MW, BSES said. Last year, the peak demand in Delhi reached 4,472 MW. TPDDL, which supplies electricity to north and North West parts of the city, expects the peak power demand in its areas to touch a record high of 1,500 MW this winter. TPDDL is fully prepared to ensure adequate power availability to around 7 mn residents in north and North West Delhi. A total of 1,700 MW of power is available from long-term sources. The peak electricity demand in the city this season is expected to touch a high of 4,800 MW. The peak winter power demand in BSES discoms BRPL and BYPL areas was recorded 1,926 MW and 1,091 MW respectively. This year, it is expected to reach 2,020 MW and 1,165 MW for BRPL and BYPL. Accurate "load forecasting" helps BSES to optimise power purchase costs. Also, its discoms use advanced statistical forecasting solutions, including artificial intelligence and machine learning for it.
Adani Transmission Ltd received letter of intent for transmission project in Maharashtra on tariff based competitive bidding model. Adani Transmission has received the letter of intent from Maharashtra State Electricity Transmission Company to build, own, operate and maintain a transmission project in Maharashtra for a period of 35 years. This will be first ever 400 kV substation facility in the city of Mumbai, the company said. The project "Kharghar Vikhroli Transmission" comprises of approximately 34 km of 400 kV and 220 kV transmission lines along with 400 kV GIS Substation at Vikhroli in Mumbai. The project has been awarded to Adani Transmission through tariff based competitive bidding process.
The competitiveness of India’s electricity-intensive exports has suffered from relatively high electricity prices and the lack of reliable provision in some parts of the country, according to the latest India economic survey by OECD. The Survey said while the provision of electricity has expanded significantly and power cuts are becoming less frequent, India ranked 108th out of 141 economies in 2019 on the World Economic Forum competitiveness index for the quality of electricity supply. OECD said that several reforms, such as reducing the number of electricity prices and making retail tariffs more cost-reflective, are being implemented in some states and would likely help make industrial companies based in India more competitive. The power ministry has scrapped the auction to procure 2,500 MW electricity for medium term (three years) under a scheme to provide relief to thermal power plants plagued by short coal supplies, NHPC Ltd said. The ministry has advised nodal agency Power Finance Corp-arm PFC Consultancy Ltd to call the bids again. Under the scheme, the NHPC as an aggregator was in the process to finalise supply of 2,500 MW through various coal-based thermal power plants for medium term at a tariff of ₹4.41/kWh discovered in a reverse auction. Some southern states discoms had evinced interest for procuring power at ₹4.41/kWh under the scheme. But aggregated power supply of 2,500 MW under the auction could not be tied up with discoms. Under Pilot Scheme-I, in October 2018, PTC India as an aggregator had finalised the supply of 1,900 MW capacity under the first such scheme at a tariff of ₹4.24/kWh and power purchase agreements were signed on 29 October 2019. The procuring discoms under Scheme-I were Telangana and Tamil Nadu for 550 MW each, West Bengal and Bihar for 200 MW each, while Haryana had consented to sign for 400 MW. The CEA wants to put in place a feeder code that will help them to identify power leakages, which could potentially reduce discoms losses. Feeders, as the name suggests, are power lines which transmits electricity from generating station to a substation, which is then distributed to end consumers. Every state discom has a feeder code. This code is similar to a vehicle number plate which helps in identifying where the vehicle has been registered. It is a four-character alpha-numeric code. The West Bengal State Electricity Distribution Company has four character code of which three are numbers. BYPL has adopted 16 character code scheme which is a combination of alphabets, special characters and numbers. Variation in coding scheme of discoms creates obstacles in importing all feeders data and their operational parameters in single platform for analysis. The Universal Feeder Code will also help in identification of particular feeder and the power supply attributes related to it once it is digitally mapped.
The Odisha Electricity Regulatory Commission awarded an LoI to The Tata Power Company, informing the company’s selection as the successful bidder to own the licence for the distribution and retail supply of electricity in Odisha’s five circles, the company said. The five circles together fall under the ambit of the Central Electricity Supply Utility of Odisha. The five circles will add 2.5 million consumers to Tata Power’s existing consumer base of 2.5 mn through its other distribution areas — Mumbai, Delhi and Ajmer. Tata Power has been offered the licence for 25 years, initially. Over 1.5 million rural women associated with self-help groups would be able to substantially enhance their income after they are engaged by the UP government to recover power dues in vast swathes of the rural hinterland. While this will expedite dues recovery from defaulters and raise revenue for the power corporation, it will augment rural earnings in a big way. The energy department has given over 12 mn power connections to rural households in the state under the Centre’s flagship Saubhagya scheme. But realisation of bills from rural consumers was becoming a challenge for Uttar Pradesh Power Corp Ltd with 70 percent households either delaying or refusing to pay bills.
The MVVNL has installed approximately 18,000 ‘smart meters’ in Bareilly city so far this year, which is roughly 10 percent of total consumers. According to information received from the power department, the city has around 182,000 power consumers. MVVNL said power consumers of both commercial and domestic categories are to be given smart meters on priority, with government departments to be covered later. It will take around a year for Bareilly to completely switch to smart meters. These meters will enable power consumers to keep track of their actual power consumption, while enabling corporation officials to collect real-time data of electricity consumption. Once the corporation completely switches to smart meters, they will be converted into prepaid meters.
The ensuing real-time market mechanism, where power can be traded on a real-time basis, is expected to provide a fillip to the electricity exchanges with a likely spurt in trading volume. Currently, the most popular form of spot power transaction is the DAM mechanism where discoms bid for power supply for the next day. The real-time mechanism is seen to significantly reduce the time of delivery to just over an hour. Existing models for intra-day power trading include DSM, ancillary services and contingency, which are not adequate to address emerging needs of time and have thrown up challenges that call for changes in market design. In September, only 3.3 percent of the total electricity generated was transacted through the DAM on power exchanges and 1.9 percent through the DSM. Nearly 70 mn kWh of electricity are traded through DSM every day. This could increase after the implementation of the real-time market mechanism. The mechanism would give more operational flexibility to thermal generators, who can sell additional power in the spot market when discoms procure lower volumes of electricity than what was scheduled by them earlier. The CERC said the role of market-based electricity transactions is going to become more crucial in near future and the share of long-term power purchase agreements — which currently constitute 90 percent of power procurement portfolio of discoms — will gradually reduce going forward. Nearly 1.5 mn employees, including engineers, of public sector undertakings in the power sector across the country will observe a one-day strike against the proposed amendment to the Electricity Act, 2003. The employees have alleged the amendment was aimed at facilitating the privatisation of power supply in India by segregating carriage and content. All India Power Engineers Federation said electricity employees in all the state power utilities across the country would stage a day-long strike/work boycott to oppose the move of the Centre to introduce multiple private supply licences. The strike/work boycott programme would be held be under the banner of the National Coordination Committee of Electricity Employees and Engineers, a broad-based umbrella organisation representing 1.5 mn power workers and engineers of the power sector of India. Earlier, the Federation had termed the draft amendment to the Electricity Act 2003 “very dangerous” since it was aimed at benefitting big power companies and criticised the Centre for ‘unilaterally’ going ahead with the proposed amendment. According to the Federation, the amendments would be a big jolt to farmers and weaker sections as it would end all subsidies, while it would result in a steep hike in power tariff, thereby making it unaffordable even for the middle class. Dubey warned the proposed Bill would have far-reaching consequences for both, the state governments and consumers.
South Africa’s state energy company Eskom is cutting up to 6,000 MW of power from the national grid after heavy rain and flooding triggered failures at its Medupi plant, disrupting supplies to businesses and households across the country. The cut is the largest since Eskom introduced a program of rolling blackouts, known locally as load-shedding, in 2008. The company had earlier said it would cut 4,000 MW from the grid as it entered a fifth day of rolling blackouts. Eskom has total nominal capacity of around 44,000 MW. The firm said unavailable capacity had risen to about 13,000 MW, forcing it to roll out nationwide blackouts. South Africa’s government asked industry for the cheapest and quickest options to ease a power crunch, as cabinet held an emergency meeting to try and resolve a crisis threatening growth in Africa’s most industrialized economy. The President called the meeting after struggling state utility Eskom implemented the most extensive power cuts in more than a decade earlier this week, disrupting supply to businesses and households. Eskom, which cut power for a ninth straight day is choking under a massive 450 bn rand ($30.6 bn) debt burden and struggles to meet demand because its creaking coal-fired power stations haven’t been maintained properly. It said the country desperately needs an additional 5,000 MW of generating capacity. The power crisis is one of the biggest challenges for the government that has promised to fix ailing state firms and reverse years of mismanagement and stagnation. Eskom, which cut 2,000 MW of power from the national grid but later scaled it back to 1,000 MW, wants a larger safety margin to do more maintenance on its plants. Eskom had almost 12,000 MW of unplanned breakdowns, versus its nominal capacity of around 44,000 MW.
Umeme Ltd, the Ugandan power distributor, said it has secured $70 mn in a syndicated loan to fund infrastructure upgrades and grid expansion. Umeme said investments will be carried out within three years and will involve revamping sections of the distribution network, increasing grid connections and boosting supply reliability. The Karuma Hydro Power plant, a 600 MW China-funded power plant on River Nile, is expected to be commissioned by next February. Uganda’s national grid currently reaches just 26 percent of the nation’s 44 mn people. When Karuma is operational, Uganda’s total power generation is expected to hit nearly 2000 MW. Umeme said the funding will also help it connect more of its customers to prepaid meters, a strategy it began rolling out in 2011 to help cut rampant customer defaults and power thefts. Last year, Umem said it plans to spend $1.2 bn over seven years to revamp and expand the grid, including extending lines and building new substations. The UN set itself a daunting challenge aimed at improving the lives of displaced people, reining in climate change and even preventing conflict: to bring electric power to all refugee camps by 2030. The target is enormously ambitious given that more than 90 percent of refugees living in camps currently have little or no access to electricity, while surrounding communities can also live with overloaded electrical systems and long power outages. Lack of power poses a challenge for cooking, keeping warm or studying, while women and girls especially face far greater safety risks in camps shrouded in darkness. With many of the nearly 26 mn refugees registered worldwide living in camps, the target of providing sustainable and reliable power to all such settlements and surrounding communities within a decade is staggering. Uganda hosts 1.3 mn refugees, also appealed for more solidarity in addressing the energy needs of the displaced.
Oman’s Electricity Holding Company, also known as Nama, has sold a 49 percent stake in Oman Electricity Transmission Company to State Grid Corp of China, raising around $1 bn. A deal for Muscat Electricity Distribution Company is planned for the second quarter of 2020. Non-binding bids had been submitted for it. The remote Tsonyi in Nagqu City in Tibet, regarded as the world's highest county, was connected to China’s state grid, enabling stable power supply to more than 7,000 local residents. In the county seat with an altitude of more than 5,000 meters above sea level, power workers braved a coldness of minus 20 degrees Celsius to start the equipment. The county used to adopt power rationing in winter, which disrupted daily work and life. In March, the State Grid Tibet Power Co, Ltd began to lay power lines towards the county, passing through a vast stretch of unpopulated Changtang National Nature Reserve. The power grid construction was completed with a government investment of $86 mn.
A nationwide strike in protest over planned pension reform has reduced French electricity generation by around 4.8 GW or 7 percent of current generation capacity, data from grid operator RTE and utility EDF showed. The data showed that power generation was curtailed at five nuclear reactors and three coal-fired power generators as workers in the power sector joined the strike that has hit several sectors including public transport and schools.
The Mexican President promised to dramatically expand electricity company CFE’s power generation business if private power companies do not boost their investments in the sector. The current government has long-favoured more robust state control over oil and power industries. The CFE’s share of Mexican power generation market could grow to as much as 70 percent from about 56 percent currently by the end of his term in 2024.
Indonesia’s state electricity company PT Perusahaan Listrik Negara (PLN) will spend a bulk of the government’s capital injection for 2020 on transmission infrastructure. About 3.7 tn rupiah of the approved 5 tn rupiah for next year will be spend on electricity transmission infrastructure for Sumatra, Kalimantan, Sulawesi islands and part of Java island. About 1 tn rupiah of the capital injection will be used to build power plants for Sumatra, eastern area of Java and for Bali and Nusa Tenggara regions.
| UHBVN: Uttar Haryana Bijli Vitran Nigam, DHBVN: Dakshin Haryana Bijli Vitran Nigam, PSPCL: Punjab State Power Corp Ltd, PPAs: power purchase agreements, discoms: distribution companies, mn: million, bn: billion, FSA: fuel surcharge adjustment, PIL: public interest litigation, BYPL: BSES Yamuna Power Ltd, kWh: kilowatt hour, IGJY: Indira Griha Jyoti Yojana, MW: megawatt, GW: gigawatt, IEX: Indian Energy Exchange, CEA: Central Electricity Authority, TPDDL: Tata Power Delhi Distribution Ltd, BRPL: BSES Rajdhani Power Ltd, kV: kilovolt, km: kilometre, OECD: Organization for Economic Cooperation and Development, UP: Uttar Pradesh, MVVNL: Madhyanchal Vidyut Vitran Nigam Ltd, DAM : day ahead market, DSM: deviation settlement mechanism, CERC: Central Electricity Regulatory Commission |
27 December. Petrol and diesel prices were once again raised by 6 paise and 15-16 paise, respectively for the second consecutive day across all major cities. In Delhi, petrol prices rose to Rs74.74 a litre as against Rs74.68, while diesel price climbed to Rs67.24 per litre from Rs67.09 a litre, according to Indian Oil Corp (IOC) data. In Kolkata, petrol costs Rs77.40 a litre, in Chennai, Rs77.70 a litre, and in Mumbai at Rs80.40 a litre after the increase. Similarly, in Kolkata, diesel costs Rs69.66 a litre, in Chennai Rs71.09 a litre, and in Mumbai, Rs70.55 a litre after an increase of 16 paise. Domestic petrol and diesel prices are reviewed by Oil Marketing Companies on a daily basis.
Source: The Economic Times
26 December. With overhang of disputes choking investments in the oil and gas (O&G) sector, the government has constituted an expert committee for time-bound resolution of exploration and production disputes without having to resort to tardy judicial process. The 'Committee of External Eminent Persons/Experts' for dispute resolution will comprise former oil secretary G C Chaturvedi, Oil India Ltd former head Bikash C Bora and Hindalco Industries Ltd Managing Director Satish Pai. The panel will have a tenure of three years and the resolution will be attempted to be arrived at within 3 months. India’s O&G sector has been plagued by disputes from cost recovery to production targets, and companies as well as the government have resorted to lengthy and costly arbitration followed by judicial review -- a process that takes years to resolve differences. The committee will arbitrate on a dispute between partners in a contract or with the government over commercial or production issues for O&G.
Source: Business Standard
31 December. The oil ministry has proposed reducing the Goods and Services Tax (GST) on compressed natural gas (CNG)-driven vehicles to 5 percent — at par with electric vehicles — from the current 28 percent to help the government’s drive to popularise gas vehicles. The ministry is seeking support from the finance ministry to cut GST rate on CNG vehicles to make them more affordable. The government aims to raise the share of natural gas in country’s primary energy mix to 15 percent by 2030 from 6 percent. The ministry wants the purchase price of CNG vehicles to go down to encourage more customers to buy them.
Source: The Economic Times
30 December. Global energy market consultant ICF is to assess India’s natural gas demand and the infrastructure needed to tap latent demand as the backdrop of the government pushing to expand the clean-burning fuel’s share in the country’s energy basket and divest GAIL (India) Ltd of its pipeline network by splitting the state-run gas transportation utility. The Petroleum and Natural Gas Regulatory Board (PNGRB) has ICF to study gas demand in different regions and the ideal locations for constructing terminals for importing gas in ships. The consultant will also examine the pipeline network needed to connect users with gas sources. The share of natural gas in India’s energy basket stands at 6 percent against a global average of 24 percent. The government wants to raise it to 15 percent over the next decade. Low domestic gas production and inadequate infrastructure, particularly pipelines to wheel fuels to consumers, are blamed for the low share of gas in the country’s energy basket. Somehow, GAIL is taking much of the blame for the lack of regional connectivity. Most of the gas pipeline network in the country owe their existence to the company’s efforts over the years. The private sector has used the situation to consistently demand unbundling of GAIL’s pipeline network by splitting the company. An assessment in 2012-13 had projected gas demand growing at a compounded annual rate of nearly 7 percent from 242.6 (mcmd) million cubic meters per day in 2012-13 to 746 mcmd in 2029-30. India’s gas consumption stood at 166 mcmd in 2018-19. Most of the consumption was recorded in the western and northern regions as the east and south lacked the required pipelines. The consumption does not reflect demand as some demand centres do not have access to gas.
Source: The Economic Times
30 December. Reliance Industries Ltd (RIL) and UK’s BP plc paid $36 mn to get their defaulting Canadian partner Niko Resources to exit from the eastern offshore KG-D6 block. Niko said it has exited from the KG-DWN-98/3 block and its 10 percent stake has been taken over by RIL and BP. RIL and BP are investing $5 bn to bring to production three sets of new discoveries in the KG-D6 block. RIL has so far made 19 gas discoveries in the Bay of Bengal block. Of these, Dhirubhai-1 and 3 (D1 & D3) -- the largest among the lot -- were brought to production from April 2009 and MA, the only oilfield in the block was put to production in September 2008.
Source: Business Standard
25 December. In a step towards ensuring piped natural gas (PNG) supply to residents and industries in and around Chennai, the Union government’s Expert Appraisal Committee (EAC) has approved Indian Oil Corp (IOC)’s Ennore-Kancheepuram underground pipeline project. The 120 kilometre (km) pipeline will act as a feeder line for the upcoming city gas distribution (CGD) project, which aims at replacing LPG (liquefied petroleum gas) cylinders with piped natural gas (PNG) supply. Till GCD becomes a reality, bulk supply to industries, which depend on natural gas, will be the primary role of IOC pipelines. As more and more industries are shifting to natural gas from conventional sources like coal, demand for piped supply is witnessing a spike. IOC started operations along Ennore-Manali pipeline project. Industries like Chennai Petroleum Corp Ltd, Madras Fertilizers Ltd and Tamil Nadu Petroproducts Ltd have started receiving gas through these pipes, IOC said. According to the project design, 30 inch pipelines will be laid from Ennore LNG Terminal situated inside Kamarajar Port Limited, Ennore, to Salavakkam Village in Kancheepuram via Ponneri and Uthukottai. Natural gas imported at the terminal will be transported to gas consumers along this route, including Hyundai Motors and Saint Gobain near Sriperumbudur.
Source: The Economic Times
< style="color: #ffffff">QuIck Comment< style="color: #ffffff">Waiving carbon tax on coal not used for pollution will benefit the struggling power sector! < style="color: #ffffff">Good! |
30 December. Prime Minister (PM) Narendra Modi’s office has proposed waiving a tax on coal to help finance pollution-curbing equipment, according to the documents, but the move would also make coal more competitive in price with solar and wind energy. Modi’s office has proposed waiving the carbon tax of Rs400 ($5.61) per tonne that was levied on the production and import of coal, according to the documents. Over half of India’s coal-fired plants are already set to miss a phased deadline starting December 2019 to cut emissions of sulfur oxides, which have been proven to contribute to lung disease. The proposal is a big win for India’s coal industry, which has lobbied for government help, citing high debt levels and burgeoning payment dues from government-owned power distribution companies. Distribution companies owed power producers more than $11 bn in dues as of October, according to government data. The proposal comes at a time when India is set to open up coal mining to global mining companies for the first time. An implementation of the proposal would provide a fillip to Coal India Ltd, whose stock has lost a fifth of its value over the last 12 months.
Source: Reuters
29 December. Amid concerns that Coal India Ltd (CIL) may fall short of its 660 million tonnes (mt) production target for the current fiscal, the miner has planned to ramp up daily output to meet the goal. Till December, the miner is expected to produce close to 390 mt of coal and will require another 270 mt in the last quarter of this fiscal to meet the annual production target. Currently, CIL produces 1.8 mt per day while the asking rate to achieve the target is 2.9 mt. Internally, CIL has planned to raise its production to 3 mt per day at least in February and March next year to inch closer to the target, CIL said. According to the provisional data, the miner produced 330.38 mt of coal during April-November in the 2019-20 fiscal, down by 7.8 percent from 358.30 mt in the year-ago period. Unless the miner increases its daily production to 2.5 mt per day from January to March period, it will struggle to surpass the production figure of the last fiscal. In 2018-19, CIL produced 606.89 mt while dispatch was at 608.14 mt. CIL’s offtake at 363.63 mt during April- November period was down by 7.2 percent from 392.02 MT supplied in the year-ago period. CIL said the coal offtake was at 410 mt till 27 December 2019 as against a target of 467 mt. In October, a rating agency had projected that the coal behemoth might miss the production target by 50-75 mt in the current fiscal. Performance of CIL’s two key subsidiaries- Mahanadi Coalfields Ltd (MCL) and South Eastern Coalfields Ltd (SECL) - will be crucial in remaining three months of the current fiscal to meet its production target. According to production data, SECL and MCL registered a negative growth of 14.5 and 9.8 percent respectively as on December 27, 2019, CIL said.
Source: Business Standard
28 December. A standing committee of the coal ministry has recommended coal linkages to state-run power plants with a cumulative capacity of 3,300 MW in Maharashtra, Tamil Nadu and Uttar Pradesh. Maharashtra had sought 3.18 million tonnes (mt) of coal per annum for an upcoming 660 MW unit of the Bhusawal power plant. The linkage committee, based on the Union power ministry’s recommendation, has sanctioned fuel supply to this unit which is expected to be commissioned in FY22. The committee also recommended bridge linkage to a 660 MW unit of Tamil Nadu’s state-owned Ennore SEZ super-critical thermal power project. However, the quantity of coal to be supplied would be sufficient for only half the unit’s capacity as its boiler is designed to run on an equal blend of domestic and imported coal. Bridge linkages are temporary fuel supply contracts for electricity generation units which have already been allotted coal blocks that are yet to commence production. The unit has been allotted the Chandrabila coal block, which is expected to start production in FY24. Under the same bridge linkage structure, Uttar Pradesh’s 1,980 MW Ghatampur plant will also get 0.5 mt of coal in FY21. The three units of the plant, of 660 MW each, are scheduled to be commissioned in November 2020, April 2021 and December 2022, respectively. The plant was allotted the Pachwara South coal block, where excavation is supposed to begin in May 2022. NTPC Barauni will receive coal under the bridge linkage till September 2022 — three years from the formal allotment of the Badam coal block in September 2019.
Source: The Financial Express
28 December. The coal ministry cancelled allocations of six blocks with power generation companies of Jharkhand, Chhattisgarh, Odisha and Maharashtra. These coal blocks, with geological reserve of around 4 billion tonnes, had been allocated to the states in the 2007-10 period to serve as fuel reserves for future power generation projects. However, none of these power projects saw the light of the day and no significant development has been made to operationalise these mines, leading to the ministry de-allocating the coal blocks. Coal Minister Pralhad Joshi said that the states have earned total revenue of Rs49.75 bn from FY15 to October 2019 from captive coal production.
Source: The Financial Express
26 December. The government is planning to give a big push to private sector mining of coal, underground coal gasification and coal-bed methane (CBM) as it spent most of 2019 laying ground for diversification of the coal sector. Stating that in 2019 the ground has been set up for CBM, UCG (Underground Coal Gasification), the coal ministry has been able to firm up a business model and in the coming years some tangible steps would be seen on the ground in CBM, UCG and surface coal gasification of technology induction. UCG is a method of converting coal still in the ground to a combustible gas that can be used for various uses, including power generation. CBM is a form of natural gas trapped in coal seams underground. Such gas can be extracted by drilling into the seam. The government in 2019 liberalised foreign direct investment (FDI) norms in coal mining. For sale of coal, allowing 100 percent FDI for coal mining activities including associated processing infrastructure, is expected to attract international players and create efficient and competitive coal market. Stating that the coal sector had a single mind-set of coal production from Coal India Ltd (CIL), the sector has to be dynamic, respond to the challenges coming from non fossil fuel component and answer the technology challenges. CIL accounts for over 80 percent of the domestic coal output. The coal position now in the country was very comfortable and the Centre exuded hope that the imports of the fossil fuel in the country would be contained to 235 million tonnes (mt) in FY20. The country produced 730.35 mt coal in FY19 while the imports were 235.24 mt. CIL produced 330.4 mt of coal in April-November 2019-20, registering a decline of 7.7 percent over 358.3 mt produced in the same period of the previous fiscal.
Source: Business Standard
26 December. The government will open up the Indian coal sector with a large offering of over 200 blocks for commercial coal mining in the next five years having a potential to produce at least 400 million tonnes (mt) of coal at peak capacity. The government hopes to stop coal imports by power plants by 2024. The first tranche of coal auctions for commercial sale purposes is likely to begin this financial year with about 40 coal blocks with peak mining capacity in the range of 1 mt to 50 mt per annum to cater to needs of all coal consumers. The coal ministry is expected to issue bidding rules for commercial coal mine auctions by the end of this month and hold stakeholder consultations next month. A few large blocks will have peak rated capacity in the range of 30-50 mt per annum, which can ease India’s coal deficit. Last fiscal India imported 235 mt of which 125 mt or about 54 percent were thermal coal imports. Due to non-availability of coking coal reserves, India will have to allow imports by iron and steel plants while the thermal coal imports can be stopped. Some of the mid-sized and large coal blocks being considered for commercial coal mining are Chendipada I and II, Madanpur North, Fatehpur and Fatehpur East, Mahanadi and Machhakata. The coal ministry will auction coal blocks for commercial mining on revenue sharing basis and proposes to announce incentives for quick production.
Source: The Economic Times
31 December. To promote horticulture-based industries and cold supply chains in the state, the Haryana government has decided to subsidise the electricity rates for the industrial units in this sector. State’s Agriculture Minister Jai Prakash Dalal said that presently Rs8 to Rs8.35 per unit is applicable to these industrial units listed under HT and LT category, respectively, but now Rs2.50 and Rs4.50 per unit will be applicable after this decision. He informed that earlier, the electricity rates of the horticulture-based industries and cold supply chain were similar to commercial industries, but on the request of farmers and entrepreneurs, Chief Minister Manohar Lal Khattar has taken this decision.
Source: The Economic Times
31 December. Kalpataru Power Transmission Ltd said that it has bagged orders worth approximately Rs9.79 bn in the transmission and distribution (T&D) segment and for railway electrification and gauge conversion. It also bagged orders from the country and Middle East in T&D business and engineering, procurement and construction projects for railway electrification and gauge conversion works in India.
Source: The Economic Times
India plans $35 bn reforms over 5 years to revive struggling power retailers
< style="color: #ffffff">QuIck Comment< style="color: #ffffff">Bailing out power retailers will reward excessive risk taking! < style="color: #ffffff">Ugly! |
31 December. India is planning another wave of reforms aimed at turning around its struggling power retailers. The initiative is still under consideration, the power ministry said. The reforms could cost as much as Rs2.5 tn ($35 bn) over five years. The measures would focus on infrastructure and technology upgrades of the ailing utilities to make them more efficient and reduce financial losses. The plan could include the installation of about 250 mn prepaid smart meters, which are expected to boost revenue collection. Other measures include systems to better monitor and control networks -- known as supervisory control and data acquisition systems -- separating grids for farmers and residential users, and replacing overhead cables with special insulated wires to prevent theft. The power ministry is working with distribution companies on models for other initiatives, with any payments from the federal government linked to meeting targets. The new measures would follow an unsuccessful plan unveiled in 2015 to make retailers profitable by March 2019. That effort included reducing revenue lost from theft and poor billing to an average of 15 percent. While such losses did decline, they were still at about 18% at the end of the year to March 2019, the power ministry said in a report. Combined net income losses at distributors that signed up for the reform plan in the same year widened to about Rs280.4 bn, an 85 percent year-on-year increase, according to the report.
Source: Business Standard
More funds for discoms under IPDS and DURES to light up entire UP
31 December. In a bid to strengthen power distribution system in the state, UP (Uttar Pradesh) government has made a fresh budgetary allocation under Integrated Power Development Scheme (IPDS), and Deendayal Upadhyay Rural Electrification scheme (DURES). While IPDS caters to urban areas, DURES is meant for rural areas. According to a government order issued by the power department, Rs700 mn and Rs97.4 mn have been released for DURES and IPDS, respectively. The allocation would be made directly available to distribution companies of UP Power Corp Ltd. The budgetary allocation comes at a time when the energy department is working towards providing more power connections to rural areas under Saubhagya scheme which envisages free electricity connections to rural poor. The allocation for DURES came days after the state government released over Rs410 mn under Rajiv Gandhi Rural Electrification Programme.
Source: The Economic Times
31 December. Power consumers in the state can heave a sigh of relief in the first quarter of 2020. Reason: Karnataka State Regulatory Commission will slash the Fuel Adjustment Charges (FAC), a component of consumer electric bills, by nearly 60 percent. FAC, which refers to charges that electricity supply companies raise based on the varying cost of fuel (coal), has been brought down to 12 paise per unit for Bangalore Electricity Supply Company (Bescom) consumers. The FAC was 29 paise/unit in Bescom limits the last quarter of 2019. In June 2019, the FAC was hiked by slightly more than 60 percent. The latest order from KERC (Karnataka Electricity Regulatory Commission), issued, has brought the FAC down by nearly 60 percent. The FAC is down by 4 paise/unit for Mangalore Electricity Supply Company consumers, 7 paise/unit for Hubbali Electricity Supply Company consumers and 6 paise/unit for Gulbarga Electricity Supply Company consumers.
Source: The Economic Times
31 December. Tea planters in Assam Chief Minister (CM) Sarbananda Sonowal’s intervention in checking the proposed tariff revision of the electricity. According to the tea planters Assam Power Distribution Company Ltd (APDCL) has proposed to increase fixed charge from Rs250.00 to Rs320.00, a hike of 28 percent and energy charge from Rs7.15 per unit to Rs8.75 per unit, a hike of 22.3 percent for tea sector. APDCL has proposed to increase tariff in the coming financial year 2020-2021 in all categories.
Source: The Economic Times
31 December. As Delhi winter breaks 118 year old temperature record, its power demand touched a peak of 5298 MW, highest ever in winters. Delhi is currently witnessing the second coldest winter since 1901 and the electricity demand in winters is likely to break past records, industry experts said. Tata Power Delhi Distribution said it met the record peak power demand of 1541 MW without any network constraint and power outage as Delhi also touched a record high of 5298 MW, highest till date. The previous highest demand of Delhi was 4800 MW and 1433 MW in January 2019. The highest ever electricity demand was witnessed in September this year at 7,400 MW. The company is expecting the peak demand to breach 1,600 MW mark this season and has made long-term power tie ups for meeting the same and has ensured reliability of its equipment at these low temperatures and foggy conditions. A total of 1,700 MW of power is available from long-term sources with the company which would help in meeting the peak demand.
Source: The Economic Times
30 December. The Maharashtra State Electricity Distribution Company Ltd (MSEDCL) has uncovered a power theft of Rs47 lakh in Ichalkaranji, the power loom hub of south Maharashtra. According to the MSEDCL, the owners of the Shivraj textiles and Adinath textiles from Ichalkaranji had slowed down their electricity meters and have been further slapped with Rs47.21 lakh bill along with an additional Rs21.68 lakh fine. The duo have to pay fine under the Electricity Act, 2003, section 152 (compounding of offenses) and further shell out Rs10.50 lakh fine each, along with the power bill.
Source: The Economic Times
29 December. A lack of level-playing field between government-owned power plants and private players has resulted in a decline in the plant load factor (PLF). PLF is the ratio of average power generated by the plant to the maximum power that could have been generated in a given time. More PLF results in more revenues and lesser will be cost of per unit (kWh) energy generated. The discrimination against private players in coal-based power plants and the lack of a level-playing field with government entities has become a cause of concern in the last few years. As per Central Electricity Authority (CEA) data, Power plants with the central government backing improved its PLF from 72.4 percent in FY18 to 72.8 percent in FY19. Further, the national average PLF was 60.9 percent in fiscal 2019. However, for state-owned power plants and private power producers, it was not exactly a merry Christmas. State and private players operated at an abysmally low average PLF of 56.5 percent, according to CRISIL. In India, dues from discoms (distribution companies) have touched Rs800 bn or around $11 bn. Approximately 70 percent of India’s power requirements are coal-based. Total conventional power generation, which is predominantly powered by coal was down 6 percent on a year-on-year basis in the month of November, according to a recent report by brokerage firm Motilal Oswal. Power demand in the south was down by 4.3 percent, west was down by 4.9 percent, north was down by 3.2 percent and east was down by 4.4 percent.
Source: The Hindu Business L ine
29 December. Power distribution companies (discoms) in the country suffered losses worth Rs270 bn in 2018-19, Union Power Minister R K Singh has said. The Centre aims to reduce electricity transmission and distribution losses in the country to 15 percent in next two years, Singh said. He noted that the discoms were facing issues related to purchase of power, maintenance and others. Listing the targets for 2020, Singh said in some states the transmission and distribution losses were very high. In addition, there were also commercial losses, related to metering, billing and bill collection. Singh said India was now exporting power to Bangladesh, Nepal and Myanmar.
Source: Business Standard
28 December. Southern states are witnessing an increase in power prices at the exchange level owing to outages of transmission links connecting the region with the rest of India which have led to power line congestion. Coupled with outages of power generation units and increasing irrigation demand, the development has resulted in a failure to attain the desired “one nation, one price” for the past several days.
Source: The Economic Times
26 December. The Shiromani Akali Dal condemned the Congress government for Punjab’s 18th power tariff increase in less than three years, saying this would cause untold misery to the common man and would make industry unviable in the state. Former Minister Sikander Singh Maluka said with an additional power tariff hike of Rs0.36 per unit which included increased additional electricity duty, domestic consumers would have to pay Rs8.37 per unit while the industry would be charged Rs7.85 per unit. He said Chief Minister Amarinder Singh has promised to reduce domestic power tariff after taking over office and had even promised power at a landing cost of Rs5 per unit to the industrial sector. He said power tariff has been increased by more than 30 percent ever since the Congress government had come to power and that the common man would not be able to bear this burden.
Source: The Economic Times
< style="color: #ffffff">QuIck Comment< style="color: #ffffff">Women will benefit from electrification only when they are liberated from the kitchen! < style="color: #ffffff">Bad! |
26 December. As new areas gain access to basic levels of electricity, men in these households tend to dominate its use, according to a study conducted in India which suggests that men benefit more than women from such access. The study highlights intra-household power dynamics as an important factor to consider for enabling more equitable energy access in developing countries. Until now, scientists believed that with better electricity access in the developing world, less time and effort was needed for tasks related to cooking, water collection, and other housework, which are typically undertaken by women. However, the researchers behind the current study, including those from Carnegie Mellon University in the US (United States), said it not enough to just look at access, since this does not adequately consider the local social context and household power dynamics. As part of the study, the researchers employed a two-part approach to understand how electrified households in India use energy. First, they conducted detailed interviews with over 30 women in electrified households which revealed what appliances were used in each house, and who typically used them. The scientists then categorized common appliances according to typical use patterns as one of three types -- more male-used, more female-used, or neutral. According to the study, households tended to have more male-used appliances than neutral, and more neutral than female-used appliances. The scientists attributed this difference to the nature of some appliances that are more female-used, such as sewing machines, mixers, and grinders. However, they said, this gender gap of electricity use existed even for the least expensive appliances like fans and light bulbs. While the poorest households in the survey had multiple bulbs and fans, the researchers said, these were rarely found in kitchen spaces. The researchers said this was despite interviewees saying that electrification in these places would make their household duties easier, and free up time for other activities.
Source: Business Standard
26 December. In the run-up to Assembly polls scheduled, Delhi Congress unit chief Subhash Chopra announced that if his party comes to power then it will give relief to people consuming up to 600 units of electricity. The Congress leader said that if his party forms the government then small shopkeepers will not have to pay commercial charges of electricity. AAP (Aam Aadmi Party) government in Delhi had announced free electricity for people consuming up to 200 units per month.
Source: Business Standard
26 December. The Noida power department has decided to lay down underground cables — a long pending demand from residents who face frequent outages due to overhead cable breakages during thundershowers or mild wind speed. Even as Greater Noida has underground power cables, Noida has begun implementing the same since last year. While the department has laid 11 kilovolt (kV) cables underground across 282 locations across the city, the 33kV cables have been laid underground in about 196 locations across five divisions of the Noida power department so far. Some of the sectors where cables have been laid underground, include sectors 63, 7, 8, 18, 19, 29, 120, 108, 132, 25, 56, 47 and more. Also, about 313 additional (duplicate) cables have been laid parallel to these underground cabling. But it’s a far cry from making Noida’s cable system underground as most such cables are not yet connected to the power supply or are in the process of being connected. However, residents feel that the work is only partially done as many areas across Noida largely deal with overhead dangling cables still. Even though the power department maintains as the work is underway they were unable to give clear data on where and by when Noida’s cabling could go underground.
Source: The Economic Times
30 December. More than 181,000 solar power pumps have been installed in the country over the past three years for meeting the electricity demand for irrigation under the Pradhan-Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyaan (PM-KUSUM) scheme being implemented by the Ministry of New and Renewable Energy (MNRE). Power And Renewable Energy Minister R K Singh said under the scheme priority would be given to small and marginal farmers for installation of solar water pumps up to 7.5 horsepower (HP) capacity for which central financial assistance (CFA) of 30 percent of the benchmark cost of the stand-alone solar pump will be provided. MNRE had issued approval for implementation of PM-KUSUM scheme throughout the country in March. The scheme has three components providing for; installation of 10,000 MW capacity through renewable energy-based small power plants of 2 MW capacity each in the rural areas; installation of 1.7 mn off-grid solar water pumps; and solarization of 1 mn existing grid-connected agriculture pumps. The scheme is targeted to meet the desired targets by 2022. The ministry recently issued guidelines for existing 1 mn grid-connected solar power pumps under the "Component C" of the scheme. Under this component, 1 mn agriculture pumps of 7.5 HP capacity each are planned to be solarised by 2022. As per provisions of the scheme, initially 100,000 grid-connected pumps are targeted to be solarised on pilot basis and further scale-up will be carried out after the evaluation of the pilot phase.
Source: The Economic Times
28 December. Gujarat was the first state in India to constitute a climate change department in 2009. A decade later, its performance has been rather dismal. Of the Rs10.48 bn allocated in the 2019-20 budget to the department that was the brain-child of the then Chief Minister Narendra Modi, it spent only Rs402.3 mn in first three quarters from April to December in the current financial year. The apathy towards taking concrete measures to tackle the future challenges of climate change is alarming as multiple studies in past five years have indicated that Gujarat would be among the worst-hit states in India. The state has already recorded a rise in average temperature during winter, increase in rainfall and extreme weather events. The longest coastline would record sea incursion and production of crops sensitive to weather such as cumin and would take a hit in near future, studies said. In fact, Gujarat has suffered the longest monsoon ning six months leading to wide-spread damage to crops. The current agricrisis of locust invasion has also got aggravated as moisture in land at this time of the year proved conducive for the pests. Although the climate change department is headed by Chief Minister Vijay Rupani himself, it ranks at the bottom among all the 27 departments in terms of spending budgetary allocations.
Source: The Economic Times
27 December. India is set to cross the 100 GW renewable energy capacity mark in 2020 and can make rapid strides towards the ambitious 175 GW clean energy target by 2022 provided the government keeps a close eye on key issues and deals with those well in time. The government, however, needs to promote storage to ensure 24x7 clean energy supply as coal fired thermal power still remains the base load in the country. Presently, the issues hampering growth of renewables in India are lack of interest of financial institution to fund renewable energy projects, safeguard duty on imported solar panels, ambiguity over Goods and Services Tax (GST) on solar equipment and low investor sentiment due to delayed or non-payment by discoms (distribution companies) to clean energy developers. India’s installed renewable energy generation capacity touched around 86 GW by November-end. Around 30 GW renewable capacity, including 18 GW solar and 10 GW wind energy, is under implementation. Besides, around 40 GW including 36 GW solar and 3.4 GW wind energy, is being tendered.
Source: Business Standard
27 December. BHEL (Bharat Heavy Electricals Ltd) said it has commissioned the first renovated 60 MW unit of NHPC’s 180 MW Baira Siul hydro project in Himachal Pradesh. Baira Siul is the first hydro station of state-run hydro power giant NHPC to have been taken up for comprehensive Renovation & Modernisation (R&M). BHEL had won the order for R&M of three units of the hydro power station located in Chamba district of Himachal Pradesh amidst stiff competitive bidding. The R&M of the other two units is under various stages of execution. BHEL is also the Original Equipment Manufacturer (OEM) of these hydro units. The company is currently executing hydroelectric projects of more than 6,000 MW, which includes 2,910 MW of projects within the country and 3,224 MW abroad. BHEL is also carrying out comprehensive R&M of more than 699 MW hydro projects across the country.
Source: Business Standard
27 December. The power ministry has invited bids from companies for setting up transmission infrastructure to evacuate power from renewable energy projects of 2,500 MW capacity in Tamil Nadu and 2,000 MW projects in Gujarat. The transmission system is to be set up for renewable energy sources in Karur-Tiruppur wind energy zone in Tamil Nadu through tariff-based competitive bidding. The ministry has selected PFC Consulting as bid process coordinator and the selection will be on the basis of build, own, operate and maintain (BOOM). The transmission project in Gujarat will provide connectivity to 2,000 MW green energy projects in Lakadia, Gujarat.
Source: The Economic Times
26 December. NTPC Ltd is planning to add 10 GW of solar energy generation capacity by 2022, which entails an investment of around Rs500 bn, to be funded mainly by green bonds. At present, NTPC has installed renewable energy capacity of 920 MW, which includes mainly solar energy. It has formulated a long term plan to become a 130 GW company by 2032 with 30 percent non-fossil fuel or renewable energy capacity. NTPC’s plans to add 10 GW solar energy capacity assumes significance in view of India’s ambitious target of having 175 GW of clean energy by 2022.
Source: Business Standard
25 December. India can consider developing a robust domestic emission trading system where the private sector participates and sells retroactive, current and future credits, according to global consulting firm PricewaterhouseCoopers (PwC). Besides, there is a need for continued efforts to de-risk and encourage private sector investment in low-carbon technologies, it said in a report titled 'Shades of Green: Reflections on COP25.' For India, PwC said, risks may arise owing to cancellation of tenders, import duties, land acquisition-related uncertainties. Policy interventions (for example standardisation of bid criteria) and financial instruments (for example loan guarantees) are required to ensure increased private sector participation. For the retroactive credits, a suitable cut-off may be decided upon review of the vintage of the available credits in the market vis-a-vis the Nationally Determined Contribution (NDC) commitment period. India has so far experimented with different mechanisms such as carbon tax, perform achieve and trade scheme besides the renewable energy certificates. Indian companies (barring a few service sector companies) have not yet started identifying climate change risks and acting upon them. A policy instrument is required that will prompt private sector companies to start disclosing as per the Task Force on Climate-related Financial Disclosures. As per the Carbon Budget Report 2019, emissions in China, India and the United States increased the most in 2018. In 2019, China’s emissions continue to increase, India’s is less, while emissions in the United States are down. The Paris Agreement aims to limit global warming to less than 2 degrees Celsius (maximum limit) and aspires to curb the rise in temperature to 1.5 degrees Celsius. Under the pact, each country voluntarily determines its own contribution to reducing emissions in order to mitigate global warming by disclosing its plans and regularly reporting progress on execution of the plans.
Source: Business Standard
25 December. NTPC Ltd has nearly 29 percent of its installed solar capacity in Andhra Pradesh. In order to reduce the cost of solar-based generation, NTPC is planning to invite separate tenders through which it will buy solar modules and construct solar parks through different contracts. NTPC has more than 900 MW of solar and wind generation units in its portfolio. By 2030, it plans to have a total power production capacity of 1,30,000 MW, out of which, solar would comprise 30,000 MW. Currently, the total installed capacity of the power behemoth stands at 57,356 MW. Apart from its own green projects, NTPC acts as an aggregator of renewable energy through which is it supplies power to a number of states from solar and wind plants owned by other developers. The Ministry of New and Renewable Energy (MNRE) has identified NTPC as the nodal agency for setting up 20,000 MW solar and wind power capacity through this mode. Recently, the Central Electricity Regulatory Commission (CERC) granted trading licence to the company to facilitate such transactions. NTPC earns a trading margin of Rs0.07/unit from such transactions. However, in the light of recent developments like non-payment of dues to renewable energy plants by Andhra Pradesh, NTPC is planning to gradually shift away from such trading-margin based business. Solar projects of even the central government-run Solar Energy Corp of India (SECI) and NTPC were not spared by the Andhra Pradesh government’s recent decision of revising renewable energy tariffs.
Source: The Financial Express
31 December. Crude oil smudges have been spotted at some Brazilian beaches in the northeast state of Ceará, the country’s navy said, almost two months after the area was hit by another oil slick. The navy said samples of the new spill were being sent for analysis to a marine studies institute, adding that sailors, volunteers, members of environmental agency IBAMA and others were recovering the oil traces from the beaches. Tourism operators in the community of Caetanos de Cima, in Ceará state, also expressed concern about the spill.
Source: Reuters
30 December. Russian and Kazakh oil pipeline operators have signed an agreement finalising compensation to Kazakh producers whose crude was tainted in the Russian pipelines this year, Kazakhstan’s KazTransOil said. KazTransOil did not announce the total sum of compensation being paid by Russia’s Transneft to 38 Kazakh companies for about 700,000 tonnes of crude.
Source: Reuters
28 December. Protesters broke into Iraq’s southern Nassiriya oilfield and forced employees to cut off electricity from its control station, taking the field offline until further notice. The oilfield produces 90,000 barrels per day (bpd) of crude. Protesters chanted “no homeland, no oil”, as they forced its closure. The incident marks the first time protesters have shut an entire oilfield, though they have blocked entrances to refineries and ports in the past. Iraq’s economy depends on oil exports which make up more than 90 percent of revenues for OPEC (Organization of the Petroleum Exporting Countries)’s second larger producer. No foreign companies operate at the oilfield.
Source: Reuters
27 December. The Organization of the Petroleum Exporting Counters (OPEC) and its allies, known as OPEC+, may consider wrapping up their oil output reduction in 2020, Russian Energy Minister Alexander Novak said. Russia’s energy ministry said that Novak was referring to 2020 when talking about a possible decision to wrap up production curbs “this year”. OPEC+ has been capping its output since 2017 in order to balance out the supply and demand on the global oil market as well as prop up oil prices. He said that the oil demand may rise in the summer when more fuel is required by motorists. OPEC+ decided to prolong its oil output restriction deal until the end of March and to deepen the cuts in order to balance out the oil market.
Source: Reuters
25 December. Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman said the Khafji oil field which is jointly operated with Kuwait would produce 320,000 oil barrels per day (bpd) at the end of 2020. He made the announcement at Khafji oil field complex in Saudi Arabia, a day after signing a deal with Kuwait that ended a dispute over the partitioned Neutral Zone that is shared by the two countries.
Source: Reuters
31 December. Israel began preliminary pumping of gas from a lucrative field in the Mediterranean Sea to its coastline rig, just days before it is to sign a major pipeline deal with Greece and Cyprus. Israel’s focus on its newfound gas reserves over the past decade has faced stiff domestic criticism from environmental and social welfare activists. The government has been too generous toward the gas tycoons behind the exploration, and that the massive investment has steered resources away from focusing on renewable energy sources. More recently, local activists have been urging Israel’s Delek Drilling and its US (United States) partner, Noble Energy, to move a proposed shoreline treatment gas rig farther out to sea. Aside from the economic benefits, the promise of gas appears to have helped Israel grow closer to Arab governments and other Mediterranean countries. The leaders of Cyprus, Greece and Israel plan to sign an agreement for the building of the eastern Mediterranean natural gas pipeline, which will run across the Mediterranean from Israel’s Levantine Basin offshore gas reserves to the Greek island of Crete and the Greek mainland, and then to Italy. The EastMed pipeline is expected to satisfy about 10 percent of the European Union’s natural gas needs, decreasing energy dependence on Russia.
Source: The Economic Times
31 December. Bulgaria said it would take delivery of crucial Russian gas supplies from January via the TurkStream pipeline that runs under the Black Sea and avoids Ukraine. The move should lead to 70 mn leva ($39 mn) in savings on transit taxes paid to Romania for gas that had first come through Ukraine, and a five percent decrease in the price of Russian gas, Energy Minister Tememoujka Petkova said. Bulgaria is almost entirely dependent on Russia for natural gas supplies and the TurkStream pipeline that is scheduled to begin operations in January is expected to provide 2.9 bn cubic meters (101 bn cubic feet) per year.
Source: The Economic Times
30 December. US (United States) exporters of liquefied natural gas (LNG) head into 2020 after a record year that saw exports soar by more than 60 percent, but growing concerns about weakened demand and heavy competition could act as headwinds in the coming year. Four new liquefaction trains - the common term for a shipping facility - entered service this year in the US. The US is on track to become the biggest global LNG exporter by 2024. LNG is seen as an alternative for Asian countries that have relied on coal-fired power plants. LNG exports have surged in recent years out of Qatar, Australia, and the US, the three biggest exporters of the super-cooled fuel. Prices in Europe and Asia are down by around 40 percent so far in 2019 to their lowest in years. Analysts at Morgan Stanley and Energy Aspects said some US LNG export terminals could shut temporarily in 2020 due to a lack of demand. Lower prices and weak demand could endanger the myriad of LNG projects still in development.
Source: Reuters
27 December. Companies developing the huge natural gas field Leviathan will begin production after receiving approval from Israel’s environmental protection ministry, one of the project’s partners said. Delek Drilling, which is leading the project with Texas-based Noble Energy, said that it had received approval from the ministry and will begin gas production. The field’s discovery in 2010 helped turn Israel into a potential energy exporter. The project’s partners have already signed major, multi-billion dollar export deals to Egypt and Jordan.
Source: Reuters
27 December. Nigeria signed a major gas expansion deal, a much-needed collaboration with oil majors that Nigeria LNG (NLNG) said would boost its liquefied natural gas output by more than 30 percent. The agreement marks a moment of amity with international oil majors, even as a tax dispute and a new law increasing the government’s take on deepwater oil production have irked some companies. The final investment decision on the Train 7 processing unit at the Bonny Island plant was signed by Nigeria LNG partners Nigerian National Petroleum Corp (NNPC), Eni, Total and Royal Dutch Shell in Abuja. The new train is expected to boost output by 35 percent to 30 million tonnes per year, NLNG said, and will arrest a decline in Nigeria’s LNG output. NLNG operates six LNG processing units, known as trains, on Bonny Island. Total, Chevron and ExxonMobil are trying to pare back some Nigerian assets as they focus on projects elsewhere, including US (United States) shale. NNPC said Nigeria’s President Muhammadu Buhari has directed NLNG to push forward to Train 12, and that they were on course to do so. NLNG signed 20-year supply agreements with Shell, Eni and Nigerian oil company Oando to feed the Train 7 project.
Source: Reuters
26 December. Russian gas giant Gazprom sees its gas exports outside ex-Soviet Union at 198.8 billion cubic meters (bcm), the company’s head Alexei Miller said, down from a record-high 202 bcm in 2018. Miller said that the company is expected to produce 500 bcm of natural gas, up from 497.6 bcm in 2018.
Source: Reuters
31 December. Poland is working on legislation that will ease the burden on consumers of the rising cost of electricity, State Minister Assets Jacek Sasin said. The country’s energy regulator URE has allowed power companies Energa and Enea to hike prices in 2020, following its approval for rival Tauron to New power prices have not yet been approved for Poland’s biggest energy group, PGE. The ruling Law and Justice party (PiS) promised last year that households would not be hit by increases despite rising carbon emission costs and surging wholesale power prices. While PiS has not given details of how it plans to hold power prices steady for consumers next year, Prime Minister Mateusz Morawiecki the government was ready to launch a scheme to offset the impact on households.
Source: Reuters
29 December. Egypt and Sudan will begin operating a joint electricity grid from 12 January with a capacity of 50 MW. The project’s cost has reached 509 mn Egyptian pounds ($31.74 mn) and s 1,000 km (621 miles).
Source: Reuters
27 December. The Indonesian government is reconsidering a plan to allow state electricity utility Perusahaan Listrik Negara to return to using adjustable tariffs for non-subsidised customers next year, its energy minister said. The final decision on tariffs would depend on a detailed review of the recipients of power subsidies based on PLN customers data. The government had previously announced it would allow PLN to charge some customers market prices starting in 2020, ending a policy of freezing tariffs since 2017. Power subsidies of 54.8 tn rupiah ($3.93 bn) was budgeted for PLN in 2020, below the 59.3 tn rupiah estimated spending in 2019, assuming such tariffs start floating in January. It was not clear whether the government would increase its power subsidies in 2020 if tariffs are kept.
Source: Reuters
27 December. Zambia’s state power firm Zesco will increase the price of electricity by an average 113 percent for all customers from next month as the African nation seeks to attract investment into power generation, the energy regulator said. Zambia’s Energy Regulation Board said it had allowed Zesco to increase electricity tariffs by more than 200 percent for residential customers consuming the least amount of power. Zambia’s electricity supply shortage increased to 810 MW in November from around 750 MW in September, Zesco said.
Source: Reuters
31 December. Britain’s Prince William launched a multi-million pound prize to encourage the world’s greatest problem-solvers to find answers to Earth’s biggest environmental problems, saying the planet was now at a tipping point. The Earthshot Prize, described in its publicity as the “most prestigious environmental prize in history”, will be awarded to five winners a year over the next decade with the aim of producing at least 50 solutions to the world’s most pressing challenges. The British royal family have for many years been vocal campaigners on a host of environmental issues, with William’s father Prince Charles speaking out for decades about the impact of climate change and the importance of conservation. The Earthshot initiative, which comes after more than a year of consultations with over 60 organizations and experts, aims to generate new technologies, policies and solutions for issues of climate and energy, nature and biodiversity, oceans, air pollution and fresh water. The project will be formally launched later in 2020 with challenges announced at events around the world and annual award ceremonies in different cities between 2021 and 2030.
Source: Reuters
30 December. Germany will take another step toward completing its withdrawal from nuclear power when EnBW pulls the plug on the Philippsburg 2 power station on New Year’s Eve, leaving half a dozen plants still to close over the next two years. The government decided to shut down the 17 reactors in operation at the time of Japan’s Fukushima nuclear disaster in 2011, when a tsunami flooded the coastal facility and knocked out its backup generators. Critics of Germany’s energy strategy said that phasing out nuclear power leaves it excessively reliant on nuclear or coal-fired power imported from neighbouring countries to cover shortfalls in environmentally friendly wind and solar power. Industry association BDEW estimates that nuclear reactors accounted for about 12 percent of German power generation in 2019, down from 30 percent in 2000. Over the same period, the share of power from renewable sources has risen to 40 percent.
Source: Reuters
30 December. Financial services have been too slow to cut investment in fossil fuels, a delay that could lead to a sharp increase in global temperatures, Bank of England Governor Mark Carney said. Carney, due to become the United Nations’ special envoy for climate change next year when he steps down from the bank, said that global warming could render the assets of many financial companies worthless. Carney said the financial sector had made a lot of progress in disclosing the risks to their assets from climate change, but he warned that progress was not fast enough.
Source: Reuters
25 December. Much of Japan is expected to have warmer than normal weather between January 2020 and March 2020. Eastern Japan, including the country’s most densely populated city Tokyo, has a 50 percent chance of higher-than-average temperatures during the period, Japan Meteorological Agency said.
Source: Reuters
Million Tonnes
| Particulars | Production | Crude Oil Processed by Refineries |
| 2017-18 | 35.68 | 251.93 |
| 2018-19 (P) | 34.2 | 257.2 |
| % Change (with respect to 2017-18) | -3.8% | 2.1% |
Production & Processing of Crude Oil for 2019-20 (April to September) (P)
P: Provisional
Source: PPAC, Ministry of Petroleum & Natural Gas
| This is a weekly publication of the Observer Research Foundation (ORF). It covers current national and international information on energy categorised systematically to add value. The year 2019 is the sixteenth continuous year of publication of the newsletter. The newsletter is registered with the Registrar of News Paper for India under No. DELENG / 2004 / 13485. 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. Opinions are those of the authors (ORF Energy Team). Publisher: Baljit Kapoor Editorial Adviser: Lydia Powell Editor: Akhilesh Sati Content Development: Vinod Kumar |
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