Energy News Monitor | Volume X; Issue 33

 

NEWS BRIEF

OIL & GAS

January 27, 2014. Oil and Natural Gas Corporation (ONGC) and Japanese major Mitsui signed a memorandum of understanding (MoU) for cooperation in hydrocarbons exploration and production in India and third countries. The agreement would pave the way for opportunities such as setting up of a re-gasification terminal at Mangalore or another location, including marketing of re-gasified LNG. Both companies would also look into specific exploration opportunities within India that could lead to joint bidding for identified blocks in forthcoming exploration rounds like NELP-10, and any opportunity outside India. ONGC and Mitsui would also explore the possibility of laying, building, operating or expanding natural gas pipelines along mutually identified routes. (economictimes.indiatimes.com)

January 24, 2014. Shortage of industry experts in many parts of the world including the Middle East and emerging oil and gas regions such as Africa and South America may turn out to be a bonanza for Indian executives, particularly those retiring from state oil firms. A database of 5,000 executives, mostly from ONGC, has evoked a lot of interest abroad. These executives can also be employed in Indian joint ventures with foreign firms as they have long experience in specialized areas of the industry. The list of executives, which was recently shared with global oil firms, included those who superannuated since January 2009 and those who will retire this year. Oil minister Veerappa Moily had also recently said many countries, particularly "emerging nations in oil and gas sector" in Africa have evinced keen interest in taking help of Indian to develop their own trained manpower. ONGC also made a similar statement after signing a memorandum of understanding with Kuwait Petroleum Corporation (KPC). This database has also been shared with the Kuwait government as part of their co-operation with the latter. ONGC has signed a MoU with KPC for the sale of 26% equity each in its two subsidiaries ONGC Petro Additions Limited and ONGC Mangalore Petrochemicals Limited. (economictimes.indiatimes.com)

January 24, 2014. India's crude oil production rose 1.6 per cent in December but natural gas output was down by 10 per cent by the flagging eastern offshore KG-D6 fields of Reliance Industries Ltd (RIL). Crude oil production in December rose to 3.25 million tonnes (MT) from 3.20 MT a year ago as higher output from Cairn India's Rajasthan oilfields negated a 3.1 per cent drop in production from ONGC fields. ONGC produced 1.88 MT of oil in December, lower than 1.94 MT it did in the same month the previous year, according to latest data released by the Oil Ministry. On the other hand, Rajasthan output soared 16 per cent to 829,646 tonnes. Natural gas production dipped 9.9 per cent to 3,001 million cubic meters in December as Reliance Industries' KG-D6 field led a 35.8 per cent drop in offshore output to 672 million cubic meters. ONGC output was almost flat at 1999 million cubic meters. The nation's 22 refineries produced 18.63 MT of fuel in December 2013, 1.7 per cent less than 18.95 MT petroleum products produced a year ago. (economictimes.indiatimes.com)

January 23, 2014. In a validation of Reliance Industries' stand, an expert committee led by former finance secretary Vijay Kelkar has said that there is little incentive for oil and gas explorers to 'gold plate' costs or wilfully under produce. The much-awaited report of the Kelkar panel on 'Roadmap for Reduction in Import Dependency in Hydrocarbon Sector by 2030' cites examples of ONGC western offshore Neelam oifields and its Russian asset Imperial Energy to say not just RIL's KG-D6 but fields around the world have experienced unexpected production declines. RIL's Bay of Bengal KG-D6 fields, which began gas production in April 2009, had hit a peak of 69.43 million standard cubic meters per day (mmscmd) in March 2010 before water and sand ingress led to shutting down of more than one-third of the wells. The output dipped to around 11 mmscmd as opposed to a projected 80 mmscmd. Currently, it is around 13.7 mmscmd. (www.business-standard.com)

January 22, 2014. ONGC expects to ramp up natural gas production up to 2 million metric standard cubic meters per day (mmscmd) during the next fiscal as two of its eastern offshore wells are set to get into production. The eastern offshore asset said the oil and gas major has chalked out a programme to take up drilling of 40 to 45 wells by 2019. The additional gas production expects to give a fillip to the company's top line as C Rangarajan's gas pricing formula is expected to come into force from April. Barclays Equity Research had earlier estimated that the price will be $8.3 per million British thermal unit in 2014-15 as against the current rate of $4.2. This will rise to $9.1 in the following year and then to $9.4 in2016-17. These two wells are located in G1 and S1 fields, which are situated around 28 km from the shore. ONGC, which has 24 blocks in KG Basin, currently produces 840 tonnes of oil per day and 3.8 mmscmd of gas from its onshore blocks. (profit.ndtv.com)

January 26, 2014. India's second biggest state-run refiner Bharat Petroleum Corporation Ltd (BPCL) plans to spend about ` 13,000 crore on expanding its Numaligarh refinery in Assam by 2017-18. BPCL plans to expand the Numaligarh refinery to 9 million tonnes from the current 3 million tonnes. (www.ptinews.com)

January 28, 2014. State-run oil marketing companies have decided on a base price of ` 44 per litre for procuring ethanol from sugar mills, rejecting supply of 36 crore litre citing higher price even as the government-mandated ethanol blending programme entails an open tendering process. Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation have invited 'expression of interest' for supply of 25 crore litre of ethanol at this price and 10% above it at 30 locations. The letter issued by the three firms invites expression of interest (EoI) for "indigenous denatured anhydrous ethanol (produced from molasses only)" at 30 industry locations. The three companies had submitted to the ministry of petroleum and natural gas that they would set a benchmark price for procuring ethanol, over and above which they would not accept any supply. (economictimes.indiatimes.com)

January 23, 2014. The local oil product sales rose for the third straight month in December from a year earlier, preliminary government data showed. Domestic oil product sales, a proxy for oil demand in the world's fourth-largest oil consumer, rose 1.3 per cent to 13.67 million tonnes, according to the data from the Petroleum Planning and Analysis Cell of the oil ministry. Diesel consumption, which makes up over 40 per cent of local fuel sales, declined 2.38 per cent, while petrol sales jumped about 7.8 percent. Diesel sales have been curbed by low demand for electricity in the winter season and slow industrial activity, mainly in the mining and construction sectors. India shipped in about 3.57 million barrels per day (bpd) of oil in December, a decline of about 5.64 per cent, the data showed. Oil products imports rose 21.33 per cent, while exports fell 8.74 per cent from a year earlier. The data for imports and exports is preliminary as private refiners provide figures at their discretion. (economictimes.indiatimes.com)

January 28, 2014. Rising petrol prices hurt the common people, as two-wheelers are the biggest consumer of petrol. Two-wheelers top petrol consumption with 61.42%, followed by cars with 34.33%, a country survey conducted by Nielsen said. Petrol consumption by two-wheelers exceeds 70% of total sales in Odisha, Bihar and Rajasthan, the oil ministry said. The survey could be an eye opener for the government, which is to face general elections in few months as steep hike in petrol rates could alienate the rural people. Petrol price soared by over 51% to ` 72.43 per litre since it was deregulated in 2010. The rising petrol prices have already started affecting sales of two-wheelers. The skyrocketing petrol prices would dampen the demand for motorcycles and scooters, the only affordable means of personal transport in rural India. Two-wheelers consumes more 61.4% of the country's 16 million tonnes gasoline sales, and 30% of this comes from villages. The survey said about 70% of diesel and 99.6% petrol are consumed in the transport sector alone. (economictimes.indiatimes.com)

January 28, 2014. The government has ordered ONGC to pay a near-record ` 13,764 crore as fuel subsidy for the December quarter, a move that will dent the firm's profitability. Oil and gas producers ONGC and Oil India Ltd bear a portion of the losses that fuel retailers incur on selling some fuels at subsidised rates. The government also offers the oil refiners a cash subsidy as compensation. The Oil Ministry asked ONGC and OIL to give ` 15,937.59 crore to make up for 40% of the ` 39,725 crore revenue that retailers lost on selling diesel, domestic LPG and kerosene at government-controlled rates in the October-December quarter. It expects the Finance Ministry to compensate for the remainder by way of a cash subsidy. (www.business-standard.com)

January 26, 2014. Oil Ministry will finalise the financial guarantees that Reliance Industries will have to submit for getting nearly double the price for natural gas from main fields in KG-D6 block. The government had decided to allow RIL higher gas price provided the firm gave bank guarantees to settle any claim against it over a shortfall in its gas output. Guidelines for submission of bank guarantee for D1/D3 fields will be finalised by February 10, Oil Minister M Veerappa Moily said. The guidelines will detail the format as well as the circumstances under which the bank guarantee can be encahsed. Considering gas prices will rise from USD 4.2 per million British thermal unit to USD 8.2-8.4 after the Rangarajan pricing formula comes into effect from April 1, the bank guarantee -- being the difference of current and new price -- for every trillion cubic feet (Tcf) of gas production will come to USD 4 billion. The bank guarantee for the entire remaining recoverable gas reserves of about 0.75 Tcf in D1&D3 fields comes to USD 3 billion. At current rate of production of about 8 million standard cubic meters per day, D1&D3 will produce about 0.3 Tcf in the next three years - the time that may be needed to settle the issue of gas hoarding charges. The bank guarantee for 0.3 Tcf comes to USD 1.2 billion, they said. Of this, the share of RIL, which holds 60 per cent stake in KG-D6, will come to USD 60 million per quarter. BP has 30 per cent interest and the remaining 10 per cent is with Niko. (economictimes.indiatimes.com)

January 23, 2014. The government has blocked 8.7 million cooking gas connections in the past year in its bid to identify genuine customers for the 'direct benefit transfer (DBT) scheme, but this has hurt dealers, who are demanding a higher commission to make up for lost sales. Customers who did not present their identity proofs and bank account details have been blocked from the LPG cylinder dealers' list as they are suspected to have "presumably diverted" the cylinders without being officially enrolled, the oil ministry said. This has stopped diversion of around five crore cylinders and would help the oil companies save ` 4,000 crore annually, the oil ministry said. The ministry hopes that this connection cancellation drive would help to subdue the prevailing black marketing of cylinders as the deduplication on intercompany connections would cease to exist post the Aadhar roll out. The LPG cylinder dealers, however, think the opposite. All India LPG Dealer's Federation (AILDF) also said that their sales and income has plummeted with the connections getting cancelled under the new Aadhar based LPG sale. (economictimes.indiatimes.com)

January 22, 2014. Following a complaint filed by two Non-resident Indians (NRIs), the Punjab State Commission for NRIs said the complainants could avail LPG gas connection as the Ministry of Petroleum & Natural Gas had informed it that foreign nationals, PIOs, and NRIs were eligible for the same. Two NRIs in their complaint with the Commission said that they could not apply for a gas connection in India despite the Centre according many benefits to Persons of Indian Origins (PIOs) and Overseas Citizens of India. They pointed out that to apply for a gas connection, one has to declare that "I am an Indian citizen". They said since they were not Indian citizen, they could not apply for a gas cylinder, which "frustrated their intention" to stay in the country for a longer period. Following their complaint, the Commission had issued notice to the Ministry of Petroleum & Natural Gas to look into this issue. The Commission said the under secretary (Marketing) of Ministry of Petroleum & Natural Gas submitted a report to it saying the matter had been examined and it had been decided that foreign nationals/NRIs/PIOs/OCIs would be eligible for a domestic non-subsidised LPG connection. (economictimes.indiatimes.com)

January 22, 2014. The oil ministry and exploration firms are keenly debating the merits of two different contract regimes for oilfields operated by companies. The Rangarajan Committee, appointed by former Oil Minister Jaipal Reddy, wants to junk the current system in which the company recovers its costs before sharing profit with the government. The regime is seen by many as the root cause of the controversies surrounding Reliance Industries' KG-D6 block and allegations that the company inflated costs. It also leads to micromanagement of oilfield activities by bureaucrats. Rangarajan suggested a new system in which the government gets its share from day one and has no interest in the accounts and expenditure of the company. But the current oil minister, Veerappa Moily, appointed another panel, led by Vijay Kelkar, former petroleum secretary. This panel wants the existing regime to continue. The oil industry favours this. Their logic: If you want companies to invest in India, which doesn't have loads of oil waiting to be pumped out, the government needs to give good incentives such as cost-recovery. The oil ministry and exploration firms are keenly debating the merits of two different contract regimes for oilfields operated by companies. (economictimes.indiatimes.com)

January 22, 2014. The Petroleum Ministry is split down the middle on allowing Reliance Industries extra time to validate five natural gas discoveries worth $ 10 billion. The exploration division headed by Aramane Giridhar supports the Directorate General of Hydrocarbons (DGH), which first sat on RIL's discovery notification for almost nine months and then declared that the company had run out of time. However, the finance wing feels the upstream regulator was equally to blame for the delay in developing the finds. The heart of the problem is what tests should be done to confirm three gas discoveries in the Krishna Godavari basin KG-D6 block and two finds in the NEC-25 block off the West Bengal coast. While the contracts for both blocks are silent on the issue, the DGH insists a Drill-Stem Test (DST) is mandatory and in its absence, has not recognised the five finds which hold a cumulative 1.1 trillion cubic feet of reserves. To break the stalemate, the ministry decided to give RIL one year of extra time to conduct DSTs. While Oil Minister M Veerappa Moily feels the ministry is empowered to take such decisions, the exploration division wants this to be vetted by the Cabinet Committee on Economic Affairs. (economictimes.indiatimes.com)

January 22, 2014. Cooking gas consumers of 480 districts will now be able to switch their cooking gas agencies as the oil ministry approved the inter-company cooking gas portability, which is similar to the number portability introduced for mobile phone users. The government had initially launched the portability scheme in only 24 districts in October last year. The scheme allows a consumer to opt for the distributor of his choice within a cluster of LPG agencies in the vicinity and across the oil companies. The consumer can chose an agency based in its track record, as service ratings of all distributors would be available online, the oil ministry said. (economictimes.indiatimes.com)

January 22, 2014. Petroleum minister M Veerappa Moily said the Cabinet is likely to consider a proposal to raise the cap on subsidised domestic cooking gas cylinders to 12 a year from the current nine per household. Moily said 89.2% of the 15 crore LPG consumers use up to nine cylinders per year and only 10% have to buy the additional requirement at market prices. If the quota is raised to 12, then about 97% of the LPG consumers would be covered by subsidised LPG, He said. Increasing the limit to 12 would result in an additional fuel subsidy burden of ` 3,300-4,000 crore for the exchequer. The government already incurs about ` 46,000 crore per annum as LPG subsidy. A subsidies LPG cylinder costs ` 414 in Delhi while a non-subsidised cylinder costs ` 1,258. (www.hindustantimes.com)

POWER

January 28, 2014. Reliance Power said the second 660 MW unit of its Sasan ultra mega power project (UMPP) in Madhya Pradesh has started commercial operations. The first 660 MW unit of the Sasan UMPP was commissioned in March 2013 while the second unit was synchronised with the grid in December 2013. For the third unit, boiler was commissioned earlier this month, it said. Sasan plant is being developed by Sasan Power Ltd, a wholly-owned subsidiary of Reliance Power. (economictimes.indiatimes.com)

January 27, 2014. Country's largest power producer NTPC has tied up $430 million (` 2,700 crore) funding from Japan Bank for International Co-operation (JBIC) for two projects. The funds would be utilised for Kudgi and Auraiya power projects. NTPC would get a term loan of $350 million to finance the supplies and services from Japan as well as India for the Kudgi Super Thermal Power Project Stage-I (3x800 MW). It is located in Karnataka. Another loan of about $80 million would be utilised to finance the renovation and modernisation of gas turbines at 652 MW Auraiya gas power station in Uttar Pradesh. This is the first time JBIC is directly extending loan facility to NTPC. Earlier, the entity had extended guarantee for an untied loan of $380 million for the company's Barh Stage-I project. NTPC has an installed capacity of 42,454 MW. (www.business-standard.com)

January 26, 2014. Indian atomic energy regulator has allowed the Nuclear Power Corp of India Ltd (NPCIL) to increase the power generation of the first unit at Kudankulam up to 75 percent. The unit is expected to generate around 720 MW. The NPCIL is setting up two 1,000 MW Russian reactors at Kudankulam in Tirunelveli district. The total outlay for the Kudankulam Nuclear Power Project (KNPP) is over ` 17,000 crore. The unit had to get two more permissions before it can go up to 100 percent reactor power levels. KNPP is India's first pressurised water reactor belonging to the light water reactor category. The first unit attained criticality in July 2013, which is the beginning of the fission process. As the first unit at KNPP is yet to be declared commercially operational, the power generated is termed as infirm power and supplied to the home state - Tamil Nadu - at low rates. (economictimes.indiatimes.com)

January 26, 2014. The implementation of new power projects would increase the production capacity of Neyveli Lignite Corporation (NLC) to 11,195 MW from the present 2,740 MW within a decade, NLC said. The 2 x 250 MW TPS-II Expansion projects would commence commercial operation in the current fiscal. Units I and II of the (2 x 500 MW) joint venture project 'NTPL' at Tuticorin is expected to be commissioned in February 2014 and May 2014 respectively. As regards the 2 x 500 MW Neyveli New Thermal Power Project, Unit I is likely to be commissioned in August 2017 and Unit-II in February 2018. Also, 51 MW Wind power farm is being set up at Kaluneerkulam in Tirunelveli District and the bid process is on for a 10 MW Solar Power plant at Neyveli. Several other projects like the 3 x 660 MW Ghathampur Thermal Power Project in Uttar Pradesh, and 1 x 250 MW Bithnok Thermal Power Project in Rajasthan are gaining momentum. (www.business-standard.com)

January 23, 2014. Tata Power said it has spent nearly ` 1,000 crore in the last 3-4 years to strengthen its transmission network which carries nearly 60-70 per cent of the bulk power consumed by Mumbai. The peak load of Mumbai was around 3500 MW in 2012, as against the embedded generation capacity of 2300 MW. The company is also planning to expand its transmission business further in the city. Recently, Tata Power commissioned additional transmission lines in Maharashtra between Kalwa and Salsette. This 220 kV line has already relieved the critical loading of the Kalwa- Salsette lines and has enhanced the transmission capacity for bringing power from outside to Mumbai city. Further, the company has also started work on installation of 400 Kv station at Vikhroli and 400 Kv Transmission lines from Kharghar/Nagothane to Vikhroli. (economictimes.indiatimes.com)

January 23, 2014. Tripura, a power surplus state, is now facing a tough time to sell its power and incurring loss in the absence of power transmission network, power minister Manik Dey said. He said, the second unit of the 726 MW Palatana power project is suppose to start power generation by June next and the state would face more problems in selling power unless the power transmission network could be built to connect with the national grid. Tripura's own generation in peak hour is about 110 MW and receives additional 40 MW from North-East grid and with the addition of 90 to 95 MW from Palatana project, the state's total surplus is about 95 MW. The state's transmission line was drawn up to Barnihat in Meghalaya by which it could be connected with the North-East grid, but it needs to be drawn up to Bongaigaon for connecting with the national grid. (www.business-standard.com)

January 23, 2014. Delhi’s three private power distribution companies petitioned the Delhi High Court against the city government’s move to have the Union comptroller and auditor general (CAG) go into their accounts. The move lacked legal sanctity, contend Reliance Infrastructure-owned BSES Yamuna and BSES Rajdhani, and Tata Power subsidiary Tata Power Delhi Distribution Ltd (TPDDL). Reliance Infra holds 51 per cent stake in BSES Rajdhani and BSES Yamuna, which cater to 75 per cent of the city’s 3.4 million consumers. Tata Power holds 51 per cent in TPDDL, which services the rest. The Delhi government holds the balance 49 per cent in each of the three companies, through its holding firm, Delhi Power Company Ltd. The discoms are incorporated under the Companies Act and have a distribution licence from the Delhi Electricity Regulatory Commission. The companies say they welcome an independent audit but within the purview of the law. The new government of Chief Minister Arvind Kejriwal had ordered a CAG audit. The process was expected to begin but had to be halted after the discoms opposed the move, CAG said. (www.business-standard.com)

January 28, 2014. The Maharashtra government is weighing at least three options to reduce power rates. The state Cabinet is expected to take up the proposal. The options include giving directions to the Maharashtra Electricity Regulatory Commission (MERC) under Sections 48 and 108 to issue a revised rate order; giving subsidy to private distributors, mainly Tata Power and Reliance Infrastructure; and ordering an audit of these firms. Besides, the government will hold a meeting with discoms to approach the regulator for a rate revision. Tata Power has a consumer base of 450,000, while Reliance Infrastructure supplies power to 2.8 million. BrihanMumbai Electric Supply and Transport has over one million consumers. (www.business-standard.com)

January 28, 2014. IIT-Madras will begin a project in a few hundred houses in the southern states aimed at eliminating load-shedding forever. IIT-M has developed a method that will let electricity boards provide a small amount of uninterrupted power to every house in the country, enough to run three lights, two fans and a mobile charger. The pilot project, which would go on for a few months, is expected to generate enough data for the power ministry to take a decision on extending the programme to the rest of the country.

It is based on a disarmingly simple idea: run a low-power direct current (DC) line from every sub-station into houses. This will feed into a separate meter, and then on to a set of lights and fans, or other low-power devices such as chargers or TVs. The rest of the house is run on regular alternating current (AC) power that is metered separately. The 100 watts of power fed into these DC lines is so low the electricity boards will never need to shut this down, except to repair technical faults. Blackouts are thus eliminated at one stroke, or converted to what IIT-M calls 'brownouts'. IIT-M has signed a memorandum of understanding (MoU) with Tamil Nadu, Karnataka, Andhra Pradesh and Kerala. The Centre has formed a committee to oversee the project, headed by the former Atomic Energy Commission chairman Anil Kakodkar. (economictimes.indiatimes.com)

January 27, 2014. The Planning Commission doesn’t seem impressed by the rising chorus for power rate cuts in many states, triggered by Delhi Chief Minister Arvind Kejriwal’s 50 per cent relief for domestic consumers. According to the Plan panel, such a move will hit reforms. Encouraged by the Delhi move, the Maharashtra government announced a 20 per cent rate cut. So did Haryana. There are demands for similar cuts in Punjab, Chhattisgarh and Bihar. B K Chaturvedi, member (energy and infrastructure), Planning Commission, said power utilities providing support to the poorest sections is a good idea, provided they can afford it. That, however, is not the case. Power distribution companies had accumulated losses of ` 2.4 lakh crore as of March 2012. Non-reflective rates as political freebies, coupled with the rising cost of power purchase, have led to a combined short-term debt of ` 1.9 lakh crore. (www.business-standard.com)

January 24, 2014. The government is set to announce changes in accounting standards to allow power companies to provision for their cost of interest payments according to the units produced rather than the entire projects, a measure aimed at preventing the units yet to be commissioned from turning into non-performing assets (NPAs). The corporate affairs ministry will shortly issue a circular to this effect. Brokerages have pegged the exposure of banks to the power sector at close to ` 6 lakh crore at the end of 2012-13. (timesofindia.indiatimes.com)

January 23, 2014. India Ratings said power generation could go up by 5-6.5% in FY15 in line with its GDP growth estimate of 5.6% but is mainly dependent on availability of coal. The increased generation would be on the back of higher domestic coal availability post the government's initiatives in the coal sector and higher availability and acceptability of imported coal than before, the rating agency said in a report. Power generation could also improve on an easing of liquidity situation at the state power utilities level post financial restructuring package implementation as it would lower back-down instructions and increase the ability to buy power. At the same time, the report said, cautious bank-lending to SPUs and moderate demand from the manufacturing segments could lead to the energy deficit at 4.5% in FY15, after declining to 4.5% in April to November from 8.7% in FY13. The report further said that with the general elections scheduled for mid-2014, many states could defer tariff finalisation or even consider reducing tariffs mainly through increasing subsidies. (www.business-standard.com)

January 23, 2014. Power consumers may have to pay more as Chandigarh Electricity Department has sought a hike of up to 24% in power tariff for 2014-15 even as the department projected a revenue gap of ` 106.98 crore for next fiscal. In an Aggregate Revenue Requirement (ARR) filed with Joint Electricity Regulatory Commission (JERC), the electricity department has proposed to levy monthly fixed charges on domestic consumers, besides power tariff hike.

As per proposal, power tariff has been proposed to be hiked by up to 20% for domestic consumers. Department has proposed ` 2.78 per unit (0-150 units), ` 4.60 (150-400 units) and ` 4.95 (more than 450 units) as against existing rate of ` 2.30, ` 4.20 and ` 4.40 per unit, respectively. In addition to it, fixed charges to the tune of ` 20 and ` 50 per month has also been proposed for consumers consuming more than 150 units per month. For commercial sector, the department has proposed to raise power rates by up to 24%. The Department has proposed power rate of ` 5.75 per unit for large supply with an increase of 22%. For medium and small supply, power rate has been proposed at ` 5.60 and ` 5.25 per unit with a hike of 24 and 19%, respectively. For agriculture sector, the power rate has been proposed ` 2.78 per unit with an increase of 21%. In addition to it, the fixed charges for commercial sector consuming 0-150 units has been proposed to be raised by 400% at ` 30 per month. For rest of sectors except small supply, fixed charges would be raised by 43% to ` 100 per month. Against the revenue of ` 647.49 crore at existing tariff, the department has projected new ARR of ` 754.47 crore for 2014-15, leaving revenue gap of ` 106.98 crore. The cumulative revenue gap has been projected at ` 156 crore for 2014-15. (www.business-standard.com)

OIL & GAS

January 27, 2014. Work to develop the North Azadegan oil field in Iran is around 61 percent complete, according to the Petroleum Engineering and Development Company (PEDEC). The first phase of the North Azadegan oil project is expected to be completed in the next 18 months, when it will produce 75,000 barrels of oil per day (bopd) from the field. PEDEC hopes production from the North Azadegan project could start earlier. At the moment, drilling of 44 of the 58 wells in the field has been completed, PEDEC said. Meanwhile, North Azadegan's oil production is set to rise to 150,000 bopd when the second phase is completed. China National Petroleum Corporation is the contractor developing South and North Azadegan oil field.

North Azadegan oil field is located in Iran's western province of Khuzestan. The field has estimated reserves of 6 billion barrels of oil and can produce 75,000 bopd for 25 years, according to the Iranian Oil Ministry. PEDEC is in charge of development plans of the oil fields located in the West Karoun region, including North and South Azadegan, North and South Yaran and Yadavaran oil fields. (www.rigzone.com)

January 27, 2014. BG Group Plc, the second U.K. oil and gas producer to issue a profit warning, said output will drop this year as political turmoil cuts exports from Egypt and other projects are delayed. BG expects 2014 production to drop to 590,000 to 630,000 barrels of oil equivalent a day from 633,000 barrels a day last year. Earnings for 2013 probably declined 33 percent to $2.2 billion, or about 65 cents a share, BG said.

Royal Dutch Shell Plc, Europe’s biggest oil company, also said that fourth-quarter earnings would fall to the lowest since 2009 amid slumping production. Lower gas volumes in Egypt and the U.S., combined with rising costs, will curb earnings at BG by about 15 percent in the next two years. BG also lowered its 2015 output forecast to 710,000 barrels to 750,000 barrels of oil equivalent a day, from the 775,000-barrel to 825,000-barrel-a-day projection it announced. (www.bloomberg.com)

January 27, 2014. Sonangol EP, Angola’s state-owned oil company, is offering exploration licenses for 10 onshore areas that may offer more crude than previously thought, according to a surveying company that has assessed the deposits. Sonangol is offering three blocks in the Lower Congo basin and seven southeast of Luanda. Onshore fields will be less expensive to tap than deep-water areas such as those where Total SA, Exxon Mobil Corp. and Chevron Corp. pump most of Angola’s 1.7 million barrels a day of output. Angola, Africa’s second-largest crude producer, is urging domestic companies to bid to increase local participation in the oil industry.

The company will explore five of the onshore blocks and hopes to offer them to bidders for development. Sonangol will retain an unspecified share in the blocks, four of which are in the Kwanza basin near Luanda and one in the Lower Congo basin in the north. (www.bloomberg.com)

January 25, 2014. Petroleos Mexicanos, Mexico’s state-owned oil company, expects to sign its first exploration and production agreements with international companies as early as year-end after Mexico ended its 75-year monopoly. Pemex, as the state oil company is known, will initially focus on mature and deep-water fields to establish the ventures, Chief Executive Officer (CEO) Emilio Lozoya said. Possible associations in the refining, transportation and petrochemical businesses can be done once congress approves the so-called secondary legislation, which is expected in April, he said. President Enrique Pena Nieto ended the seven-decade-plus production monopoly held by Pemex, allowing foreign companies to produce crude in the largest supplier to the U.S. after Canada and Saudi Arabia. The overhaul may bring an additional $20 billion in foreign direct investment as soon as 2015, according to Bank of America Corp. Pemex expects to start new wells in the next few months, helping the company boost its oil output to 2.6 million barrels a day, Lozoya also said. Output is presently 2.503 million barrels a day, according to preliminary data from the company. (www.bloomberg.com)

January 24, 2014. Uganda has completed negotiations with Britain's Tullow Oil and its partners and will soon sign an agreement that could pave the way for the start of crude production. East Africa's third-largest economy struck hydrocarbon deposits in the Albertine rift basin but commercial production has been delayed and is not expected until 2016 at the earliest.

Energy minister Irene Muloni said the government would shortly sign the memorandum of understanding (MoU) with Tullow and its partners, France's Total and China's CNOOC. Developing Uganda's oil fields and building the required infrastructure would cost between $15 billion and $22 billion, although there were plans to try to reduce that, Muloni said. (www.rigzone.com)

January 23, 2014. PetroChina has put off starting up two new refineries and delayed expansion of another to counter the threat of overcapacity as oil demand growth slows in the world's second largest oil consumer, the company said. China's oil consumption last year grew at its slowest in more than 20 years, as soft economic growth sliced demand for transportation and industrial fuels such as diesel. The delays should also help support Asia's refining margins, which were expected to be weak this year with the planned capacity additions in China and more in the Middle East. PetroChina will now start up its 200,000-bpd Kunming refinery in the Yunnan province in 2016, two years behind the original schedule. Operation of a 400,000-bpd joint venture refinery in Jieyang of Guangdong province will be delayed to 2017, versus the original plan of 2013. The company will also delay expansion of Huabei refinery in north China to 2015 from this year. China's implied oil demand - refinery throughput plus net fuel imports but excluding changes in inventories - rose 1.6 percent in 2013, or a meagre 150,000 bpd. (www.downstreamtoday.com)

January 22, 2014. ExxonMobil said that its 300,000 barrel per day refinery in Antwerp was operating normally, contradicting traders' reports that there had been a problem at the plant. Earlier, traders said that the diesel desulphurisation unit at the refinery in Belgium was shut due to a fault. (www.reuters.com)

January 27, 2014. Thousands of Manitoba residents were without natural gas to heat their homes and businesses for a third frigid day, following a weekend explosion along a TransCanada Corp pipeline in the Western Canadian province. The incident interrupted the supply of natural gas to 4,000 residents and other customers, although TransCanada arranged for tanker trucks to deliver compressed natural gas to a hospital and nursing homes. TransCanada was working on restoring the gas supply to the area in two stages, starting with residents and other customers north of the damaged pipeline. (www.downstreamtoday.com)

January 27, 2014. The United Arab Emirates (UAE), a Gulf OPEC oil producer, said it was looking at the possibility of importing natural gas from North America, in what would be one of the most striking developments since the start of the U.S. shale boom.

The United States and Canada are producing record amounts of gas from shale rock formations, pulling down North American prices to levels that have attracted the interest of foreign buyers. Around a dozen long-term deals, each worth billions of dollars, have recently been signed behind closed doors between U.S. producers and buyers in China, Japan, Taiwan, Spain, France and Chile as global demand for gas increases.

Rapidly rising demand and slow production growth have made the Organization of Petroleum Exporting Countries (OPEC) member a net importer of gas over the past few years. The UAE's Abu Dhabi National Energy Company has already invested in Canada's oil and gas sector but so far has not been publicly involved in North American natural gas export projects. (www.downstreamtoday.com)

January 24, 2014. Algerian gas flows to Italy recovered following significant falls in recent days after quality issues prompted gas grid operator Snam to return some of the gas. Italy gas flows from Algeria are expected to be 39 million cubic metres (mcm), meeting demand from shippers. For several days most of the gas Italy received from Algeria was sent back because it did not meet the standards needed by the Italian system. Algeria is Italy's No. 2 gas supplier after Russia. (www.downstreamtoday.com)

January 24, 2014. Iran is exaggerating its crude oil export figures and won’t be allowed to sell more than 1 million barrels a day over the next six months, U.S. officials involved in managing sanctions against the country said.

Iran says it shipped 1.51 million barrels a day in November, according to figures the nation submitted to the Riyadh-based Joint Organisations Data Initiative. The data, along with historical export figures, were published Jan. 20, the same day the U.S. and its allies temporarily eased some of the sanctions against the Persian Gulf state as part of a deal to curb its nuclear program.

The Obama administration said after the Nov. 24 accord was struck that Iran’s exports have been forced down to 1 million barrels a day, a reduction of more than half from 2.5 million a day before U.S. and European Union sanctions were imposed, and won’t be allowed to increase before a final nuclear deal is reached and all sanctions are lifted. Iran may be inflating its data to try to set a higher baseline for subsequent negotiations and hoping its elevated numbers will help attract overseas investors, said the U.S. government officials. So far, Iran hasn’t challenged the 1 million barrel-a-day figure in meetings with U.S. negotiators, one of the U.S. officials said. (www.bloomberg.com)

January 23, 2014. TransCanada Corp., the Calgary-based company behind the Keystone XL pipeline, spent $1.05 million to lobby Congress and the administration last year, about 24 percent more than it spent in 2012, records filed with the U.S. Senate show. The $5.4 billion proposed link between Canada’s oil sands and refineries along the Gulf Coast is under review at the U.S. State Department because it crosses an international border.

The project has inflamed environmental groups including the Sierra Club that say it will worsen global warming. The production of oil sands releases more greenhouse gases than other forms of oil. Supporters say it will boost U.S. energy security and create thousands of construction jobs. (www.bloomberg.com)

January 22, 2014. Koch Pipeline Co. called off plans to build a 250,000-barrel-a-day crude line to Illinois from North Dakota’s Bakken formation, where a shale boom has helped lift domestic production to the highest in a quarter-century.

The indirect subsidiary of Koch Industries Inc., one of the largest private companies in the U.S., is no longer developing the so-called Dakota Express pipeline. The Wichita, Kansas-based company was scheduled to begin a 45-day open season to gauge interest from potential shippers on the line in July. (www.bloomberg.com)

January 28, 2014. Iraq is awaiting a response from the country’s semi-autonomous Kurdish region on a proposal for exporting the area’s crude, and will impose penalties if the oil is sold without Baghdad’s approval, Iraq’s Deputy Prime Minister for Energy Affairs, Hussain al Shahristani said.

Kurdish crude should be exported by Iraq’s State Oil Marketing Organization, known as SOMO, while international oil companies operating in the enclave should be paid from the Kurdistan Regional Government’s share of the national budget, Hussain al Shahristani said. The conflict in Syria has resulted in a higher rate of terrorist attacks in the west of Iraq, hindering exploration of oil resources there, he said. Iraq’s Kurds have announced plans to sell crude that has been pumped through a pipeline from the Kurdish region to the border with Turkey. The KRG halted flows via the central government’s export line to Turkey in 2012 because of a dispute over how to share revenues. Authorities in Baghdad have said contracts independently signed between the KRG are international oil companies are illegal. There are “fiscal” actions Iraq can take if oil is sold outside of SOMO’s control, Shahristani said. Baghdad has also warned Turkey it will impose penalties if the KRG’s crude is sold. The central government has yet to see any of the agreements signed between the KRG and foreign companies, he said. The KRG’s 300,000 barrel-a-day link connects to the main Iraqi export pipeline at Fishkabur, near the Turkish border.

The central government in Baghdad is waiting for the KRG to agree that it will contribute 400,000 barrels a day to the national oil export total in 2014 before they can pass this year’s budget, Shahristani said. Holder of the world’s fifth-largest oil reserves, Iraq plans to increase oil production capacity to 4.7 million barrels a day next year, from about 3 million in 2013, and reach 9 million in 2020, Shahristani said. (www.bloomberg.com)

January 27, 2014. OPEC isn’t threatened by U.S. shale oil production and the group can absorb higher output from its members Iran, Libya and Iraq when supply outages are resolved. OPEC predicts its 12 members will need to provide an average 29.6 million barrels of crude a day this year, about in line with the group’s current output.

OPEC said it produced 29.44 million barrels a day in December, with output curbed by losses in Libya. OPEC is responsible for about 40 percent of world oil supplies. Production from OPEC may rise this year if Libyan protests subside, sanctions against Iran are lifted and Iraq meets its goals to lift output. (www.bloomberg.com)

January 27, 2014. Japan's imports of liquefied natural gas (LNG) rose to another record in 2013 as the country's second complete shutdown of its nuclear stations since the Fukushima disaster in 2011 forced utilities to burn more fossil fuels to generate power. The soaring cost of fuel imports let Japan to post a record annual trade gap of 11.47 trillion yen ($112.06 billion) in 2013, up from 6.94 trillion yen in the previous year and a third straight year of deficit. LNG imports increased 0.2 percent to 87.49 million tonnes last year, the Ministry of Finance said. Japan's crude oil imports in 2013 fell 0.6 percent to 3.65 million barrels per day (211.717 million kilolitres), a two-year low. Japan, the world's top importer of LNG, paid a record 7.06 trillion yen ($68.98 billion) last year for LNG, overturning a previous record in 2012. (www.downstreamtoday.com)

January 27, 2014. The Parliament of the Republic of Ghana has ratified a petroleum agreement between the country's government and a consortium of exploration companies to explore and operate the South Deepwater Tano Block.

The ratification of the agreement means the consortium – which consists of Ghana National Petroleum Corporation, GNPC Exploration and Production Company Limited and AGM Petroleum Ghana Limited – now has the exclusive right to carry out all petroleum exploration, development and production activities within the block. (www.rigzone.com)

January 27, 2014. Brazil's ANP oil regulator said it would decide over the next 60 days whether to revoke the exploration rights for blocks controlled by Óleo e Gás Participações SA, the ailing oil company of Brazilian industrialist Eike Batista.

The regulator said it had received documents from Batista's company and will be evaluating the financial capacity of Óleo e Gás to meet its timeline for investing and developing exploration blocks. (in.reuters.com)

January 27, 2014. Hedge funds are the most bullish on benchmark U.S. natural-gas futures since at least 2006 after a freeze drove prices for the heating fuel to a three-year high. Gas jumped above $5 per million British thermal units for the first time since June 2010 as forecasts showed arctic weather persisting through early February. The amount of gas withdrawn from storage from Oct. 31 through Jan. 17 was the most for that period on record, government data show. (www.bloomberg.com)

January 23, 2014. Alaskan coastal drilling by oil companies including ConocoPhillips and Royal Dutch Shell Plc may be further delayed after a federal appeals court ruled the government acted illegally in opening almost 30 million acres on the continental shelf to energy exploration.

The Sierra Club and other organizations sued the government after the $2.6 billion sale of development leases for the Chukchi Sea off the northwest coast of Alaska in 2008, saying the amount of oil from the leases was far higher than the 1 billion barrels the U.S. Interior Department estimated in an environmental review approving the sale. (www.bloomberg.com)

January 22, 2014. Iran is postponing by about three months a conference at which it plans to introduce new contract terms to international energy companies, said Mehdi Hosseini, an adviser to Oil Minister Bijan Namdar Zanganeh. The London event, originally scheduled for early April, will be held instead in late June or early July, Mehdi Hosseini, the head of an Oil Ministry committee that reviews contracts, said.

Iran’s existing buy-back contracts require companies to pay for oil and natural gas exploration and recover their investment from any production at a pre-arranged rate of return. Hosseini said that the nation, hampered by economic sanctions over its nuclear program, was working on new terms that conform more closely with international norms to attract foreign partners to help develop energy resources.

The content of the planned oil conference, which will introduce opportunities in “post-sanctions” Iran, won’t change, Hosseini said. Iran is a member of the OPEC and holds the world’s biggest proven gas reserves, according to the BP Statistical Review of World Energy published in June 2013. (www.bloomberg.com)

POWER

January 27, 2013. Compared to November 2013, in December 2013, Slovenia's total net electricity generation increased by 21% and consumption increased by 3%. Hydro power plants generation decreased by 34%, generation in the thermal power plants increased by 7% and nuclear power plant increased by 319%. In line with the higher production in thermal power plants, fuel consumption in December 2013 also increased by 7%. In December 2013, 602 GWh of electricity was imported and 760 GWh was exported. (www.balkans.com)

January 23, 2014. Abu Dhabi National Energy Company, TAQA, has revealed plans to build an energy facility that will generate 300 MW of power at the Takoradi Thermal plant in Ghana. The plant will make the precarious power situation in the country a thing of the past, and pave way for Ghana to become a net exporter of power, Ghanaian president, Dramani Mahama said. President Mahama said the country is on course to achieve its goal of generating 5,000 MW of power by 2016. TAQA, which is Ghana’s largest UAE investor, says with the additional 300 MW of power and the Liquefied Natural Gas, it would also enhance the supply of electricity and potable water to the Western and Central regions of Ghana. The additional 300 MW would be built upon completion of another facility at a plant that will generate 110 MW. (www.ventures-africa.com)

January 28, 2014. Duke Energy Corp., the largest U.S. utility owner by market value, ended talks to buy a stake in two nuclear reactors under construction in South Carolina after Scana Corp. increased its share of the project. Scana said that its South Carolina Electric & Gas Co. bought another 5 percent from partner Santee Cooper for $500 million, increasing its overall interest to 60 percent. Santee Cooper, South Carolina’s state-owned electric and water utility, has no plans to divest more of the V.C. Summer Station project. Santee Cooper had been seeking a buyer for as much as 10 percent of the project since 2011. (www.bloomberg.com)

January 27, 2014. Verso Paper Corp. has agreed to purchase the full assets of a power plant that is co-located with its paper mill in Bucksport. The deal is not final, but Verso plans to acquire 100 percent of Bucksport Energy LLC, which owns and operates a gas-fired power plant that is co-located with Verso’s Bucksport paper mill. The Verso subsidiary acquiring the plant is Verso Bucksport Power LLC. Verso is already a part owner in the power plant. It has owned 28 percent of Bucksport Energy since the plant became operational in 2000. The other two owners of the power plant are Hydro-Quebec and the French company GDF Suez. The power plant does not provide most of its power to the Bucksport mill. It provides only 28 percent of the power it generates to the Verso mill while the other 72 percent is sold back to the power grid operated by ISO-New England. In addition to the electricity the plant generates, Verso’s mill also uses the power plant’s steam in the papermaking process. (bangordailynews.com)

January 22, 2014. Japan, once Asia’s largest nuclear power producer, may restart one in every five reactors this year after safety reviews following the Fukushima disaster, driving uranium back into a bull market. The nation may open 10 units, according to the median of 11 analyst estimates. Japan has been without atomic power since September, with its 50 reactors shut pending inspections by regulators. Uranium will average $41 a pound this year, or 14 percent more than now, a separate survey of five analysts showed. Uranium slumped 51 percent since the earthquake and tsunami that led to the meltdown at Tokyo Electric Power Co.’s Fukushima Dai-Ichi plant in March 2011. Stronger demand will boost profit for producers from Kazakhstan to Australia, some of whom canceled projects and closed mines as prices tumbled. Opening reactors will make Japan less dependent on imports of fossil fuels that contributed to a record current-account deficit. Tokyo Electric, Japan’s biggest power utility, and Tohoku Electric Power Co. are among seven companies that applied for safety inspections on 16 reactors, according to the Nuclear Regulation Authority (NRA). The NRA has no fixed schedule to complete the checks, it said. (www.bloomberg.com)

January 27, 2014. Orient Green Power Company Limited (OGPL) announced that its operating capacities now exceed 500 MW. This comes after the recent commissioning of three Biomass units in Narsinghpur (MP) – an unit of the company and Kishanganj, (Rajasthan) and Marikal (AP) units through its subsidiaries. As of date, the Company’s operating capacity stands at 502 MW comprising 416 MW of Wind assets and 86 MW of Biomass assets. Orient Green Power, part of the Shriram Group, has its wind farms located in Tamil Nadu, Andhra Pradesh, Gujarat and Karnataka. The company is also a leading biomass energy business with a capacity of 86 MW across its plants located in Tamil Nadu, Rajasthan, Madhya Pradesh, Andhra Pradesh and Maharashtra. The company said to further consolidate its presence, OGPL is on track to commission a further 40 mw of capacity across both verticals and evaluating opportunities arising in the space especially wind business, which could further propel its growth of the business. The company is also close to commissioning another 40 MW of capacity under our wind and biomass verticals which will help us to further consolidate our position as a leading player in the renewable energy business. (www.business-standard.com)

January 23, 2014. Greenpeace activists dressed in tiger suits climbed atop the Mumbai headquarters of Essar Group and unfurled a banner protesting a coal-mining project proposed by billionaire brothers Shashikant and Ravikant Ruia. Twelve activists climbed the building after managing to get past security at the business group engaged in steel to oil production, while about 30 villagers and local volunteers staged a rally outside the office. Essar, in an equal partnership with billionaire Kumar Mangalam Birla’s Hindalco Industries Ltd. (HNDL), plans to develop a coal mine in the central Indian state of Madhya Pradesh to help feed power projects with an estimated investment of about $2 billion. Greenpeace said that mining operations will destroy the biodiversity of forests in the region. Greenpeace is also campaigning against Veerappa Moily, India’s environment minister, who has approved stalled projects valued at 1.5 trillion rupees ($24.2 billion) in the past month since taking charge. (www.bloomberg.com)

January 23, 2014. Renewable energy projects worth ` 30,000 crore are being implemented in Madhya Pradesh (MP), which have quietly reached out to companies and attracted GE, Reliance Power, Spanish wind major Gamesa and others, giving tough competition to Gujarat in the sector. The buzz of activity has catapulted the state to the top slot of renewable energy in the country where Narendra Modi's Gujarat was hailed as the most successful state in the sector. MP's Chief Minister Shivraj Singh Chauhan has accelerated the state's drive for renewable energy, helping it expand rapidly and kickstart many projects, including 4,600 MW of being executed. The state invited proposals in November 2012, seeking investments to the tune of ` 10,000 crore, with the full backing of Chauhan. To set up a wind project, the developer has to just submit a resource assessment report of any site in the state. It applies for solar, bio and hydel as well, where if the selected site is government's land, the developer gets it for the life of the project i.e. 25 years. (economictimes.indiatimes.com)

January 22, 2014. An appellate body for power sector disputes has set aside the Tamil Nadu government's rule requiring industries to meet a portion of their energy needs through solar power, in a setback for the power-starved state's solar plans. The Appellate Tribunal for Electricity ruled on a challenge filed by the Tamil Nadu Spinning Mills Association, an industry body whose members say they run wind farms with over 3 GW capacity, nearly half of the state's wind capacity. The state government introduced a solar purchase obligation of 3% (for 2013) and 6% (2014 onwards) in an attempt to add 3 GW solar power by 2015 from virtually next to nothing in early 2013. Tamil Nadu, thus, became the only state to have such mandatory requirements for solar power use. The Tamil Nadu Electricity Regulatory Commission had approved the plan. Solar developers preferred to wait for the finer details of the order before commenting on its implications. Tamil Nadu had invited bids for building solar plants with a total capacity of 1,000 MW. And, though over 50 solar developers have signed the letters of intent to set up nearly 700 MW capacity, the power purchase agreements haven't yet been signed. (economictimes.indiatimes.com)

January 28, 2014. Subsidies for renewable energy are partly to blame for Europe’s electricity market “crisis” and should be revised, according to a French study. The system of feed-in tariffs that pay above-market rates for wind and solar energy should be changed to one based on tenders and rates pegged to market prices, a report from the French planning commission Commissariat General a la Strategie et a la Prospective recommended.

The European Union is wrestling with how to reduce pollution while keeping a lid on power prices that can be more than double those in the U.S. Germany, France, Spain, Britain and Italy all have trimmed subsidies after a boom in installations increased bills. The rise in capacity of renewable energy is posing a “serious threat” to European power supply security, industry competitiveness and consumer purchasing power, the study found. The study recommends that the EU fix targets for lowering greenhouse gas emissions and refrain from setting a target for the share of renewables. (www.bloomberg.com)

January 28, 2014. Chinese Premier Li Keqiang said governments should take a leading role in promoting alternative energy-powered vehicles. China plans to have 5 million alternative energy-powered automobiles by 2020. China’s provinces and biggest cities have been given targets to cut concentrations of some air pollutants by 5 percent to 25 percent by 2017 compared with 2012 levels. An increasing number of Chinese cities have introduced emergency measures to fight smog. BYD Co., backed by Warren Buffett’s Berkshire Hathaway Inc., said that it had failed to qualify for local incentives in Beijing and Shanghai. Government subsidies are important because of the high cost of building electric vehicles and charging stations. The automaker in October forecast full-year profit will surge as much as 619 percent on improved car sales and narrowing losses in its solar-energy business. (www.bloomberg.com)

January 27, 2014. The U.K.’s largest solar farm generated 15 percent more power than expected from November through Jan. 22, said Foresight Solar Fund Ltd., which bought the facility three months ago. The company spent 30 percent of funds raised in the 32 MW Wymeswold farm, which has so far exceeded expectations. Two further plants totaling 28 MW- Castle Eaton and High Penn - may be fully operational and hooked up to the grid shortly, the Sevenoaks, southeast England-based group said. Britain may build more big plants of 2 MW or more than any European country, adding as much as 2,000 MW of capacity this year. (www.bloomberg.com)

January 27, 2014. China's commerce ministry called on the United States (US) to stop anti-dumping investigations into imports of solar power products from China, expressing "serious concern" and vowing to defend its producers. US trade officials opened investigations into imports of certain solar power products from China and Taiwan, a move that could have a major impact on the nation's fast-growing solar market. The US Department of Commerce said it initiated antidumping duty and countervailing duty investigations, which will assess whether the products are being sold in the United States below their fair value, or if their manufacturers receive inappropriate levels of foreign government subsidies. China will assess the impact on its solar industry and "resolutely defend" itself through various mechanisms, the ministry said. The investigations were sparked by a complaint at the end of last year by the US unit of German solar manufacturer SolarWorld AG. The company at the time said it was seeking to close a loophole in a prior trade case that enabled Chinese solar panel producers to evade duties by using cells manufactured in other countries, mainly Taiwan. The Commerce Department investigation and a parallel inquiry by the US International Trade Commission (ITC) could open the door to expanding duties on some imported solar panels. In October 2012, the US set steep duties on billions of dollars of solar products from China, but turned down pleas to expand the scope of its order to include Chinese panels made with non-Chinese solar cells. In response, many Chinese module producers simply began sourcing cells from Taiwan. The ITC is to make a preliminary ruling on whether there is a reasonable indication that imports from China or Taiwan materially injure, or threaten to injure, the local industry by February 14. A negative finding would stop the investigations. If the ITC determines that the imports could be hurting the domestic industry, the Commerce department is to make preliminary determinations about subsidies in March and dumping in June. (www.business-standard.com)

January 27, 2014. Renewable-energy companies will derive more of their funding from bond markets as banks curb lending to the industry, Michael Eckhart, Citigroup Inc.’s head of environmental finance said. Green-bond sales and initial public offerings will expand after kicking off last year, Michael Eckhart said. Bonds backing clean-energy and environmental ventures may account for 10 percent to 20 percent of the $7 trillion-a-year market for the securities within a decade, he said.

Eckhart’s comments cast a positive light on an industry whose funding is threatened by cuts in support for renewables from governments in the U.S. and Europe. Money managers are seeking investments that highlight their green credentials while offering an alternative to more volatile equities. Banks in Europe, the U.S. and Japan reduced lending to clean-energy projects as the economic crisis took hold. While they’ll retain a role in the industry as they can take on project risks that institutional investors can’t sustain, capital markets will increasingly provide finance, Eckhart said. (www.bloomberg.com)

January 26, 2014. The pace of consolidation in the solar manufacturing industry will accelerate in the next three years as the cost of the technology declines and installations surge, the founder of the fourth-biggest solar-panel maker said. Trina Solar Ltd. Chairman Jifan Gao said he expects three to five “leading” solar companies to remain in China by 2017, with 80 percent of the country’s market share. Currently, there are about a dozen companies with capacity to produce more than 1 GW of solar cells a year.

Solar-cell prices have fallen 70 percent since 2010 as the expansion in production capacity outpaced growth in demand. That squeezed profit margins across the industry and pushed the world’s biggest manufacturer, Suntech Power Holdings Ltd., into bankruptcy proceedings in China.

Yingli Green Energy Holding Co., Suntech and Canadian Solar Inc. were Trina’s largest competitors in panel-making capacity in 2012. The Changzhou, China-based company ranked third worldwide in 2010 and 2011. Trina posted a profit for the first time in more than two years in the third quarter. Gao said he expects earnings to increase as sales climb and cost-controls hold. The company’s shares have more than tripled since November. (www.bloomberg.com)

January 25, 2014. Tesla Motors Inc.’s Elon Musk said sales of electric Model S cars in China should match U.S. levels as early as next year, with demand from the world’s largest auto market eventually requiring a local plant.

The electric-car maker said the Model S will be priced from 734,000 yuan ($121,280) in China when deliveries begin. Musk, Tesla’s billionaire co-founder and chief executive officer, will travel to China in late March to inaugurate the company’s entry. After a rocky start ramping up Model S assembly in 2012, Palo Alto, California-based Tesla surprised analysts and investors this month when it said fourth-quarter deliveries were 20 percent above its target. Musk has pinned his goal of selling hundreds of thousands of electric autos annually to a global strategy in which China, Europe, Japan and other markets bolster its U.S. business. If all goes well, Model S shipments to China can match U.S. sales by 2015, Musk said. (www.bloomberg.com)

January 24, 2014. China, the world’s biggest solar market, kept in place its annual installation target for technology and also for wind power. China plans to add 10 GW of solar power and 18 GW of wind this year, the National Energy Administration said. Developers in China installed a record 12 GW of solar panels in 2013, almost matching the total amount of solar power in operation in the U.S., and may exceed that in 2014. The power plants were built mostly in China’s sunny, western provinces of Gansu, Xinjiang and Qinghai and make its state-owned power companies the world’s biggest owners of solar assets, the London-based research company said. China’s photovoltaic installations surpassed longtime leader Germany. The pace triple the 3.6 GW put in place in China in 2012, and the nation expects to add 14 GW of solar capacity this year. Chinese developers rushed to complete projects before the end of the year, when a 1-yuan (17 U.S. cents) a kilowatt-hour incentive expired. That may have led to as many as 2 GW of late-year additions that aren’t included in the 12 GW total. (www.bloomberg.com)

January 24, 2014. China decided not to levy duties on polysilicon imported from the European Union, ending a threat against suppliers such as Germany’s Wacker Chemie AG, Europe’s largest maker of the raw material used in most solar panels. The Ministry of Commerce said the decision was temporary and was made because of a “special market situation”. It didn’t elaborate on the special situation. China had already determined EU polysilicon makers were selling at prices below their costs. The outcome of China’s fair-trade case against the EU -- if it’s not reversed -- should help to wind down a dispute over solar-energy components that stretched over three continents and was becoming a trade war. Polysilicon is the main ingredient in solar cells, and China is the world’s largest producer of the devices that power solar panels. The U.S. in 2012 imposed anti-dumping duties, or tariffs, of as much as 250 percent on solar cells imported from China and anti-subsidy penalties of about 15 percent. The EU followed with provisional duties of as much as 67.9 percent in June. China began investigating EU polysilicon importers in 2012. In July, China settled with the EU on a minimum price and a volume limit on European imports of Chinese solar panels until the end of 2015, in return for EU tariffs being dropped. The U.S. polysilicon suppliers that also were investigated by China received anti-dumping duties of as much as 57 percent. Those haven’t been reversed. Separately, the U.S. is expanding its fair-trade investigation to Taiwan-made solar cells to close a loophole SolarWorld Industries America said allows Chinese competitors to avoid the tariffs. (www.bloomberg.com)

January 24, 2014. Germany is set to become the first nation in Europe to charge owners of renewable energy plants for their own use of electricity, part of Chancellor Angela Merkel’s effort to contain rising power bills. Merkel’s Cabinet backed proposals to charge operators of new clean-energy plants 70 percent of the so-called EEG-Umlage, a fee paid by power consumers that they’re currently exempt from, according to an economy ministry document. That would translate into 4.4 euro cents (6 cents) a kilowatt-hour. The solar industry says such a payment would curb investments in the technology in the nation that has the most installations of photovoltaics in the world. German consumers pay for the country’s clean-energy expansion through a surcharge on their bills. The fee is inflated by the rebates for consumers that use their own power and by aid for companies that are large energy users. It jumped 18 percent to 6.24 euro cents a kilowatt-hour this year. German households are now paying more for electricity than any other nation in the European Union except Denmark. The charge would not be applied to new units sized 10 kilowatts or smaller, according to the document. Operators of new fossil-fired plants who consume the power themselves would have to pay 90 percent of the charge, according to the document. (www.bloomberg.com)

January 24, 2014. The U.S. wind turbine market is likely to be stable this year and next even though the main government incentive to the industry has expired, Vestas Wind Systems A/S Chief Executive Officer Anders Runevad said. The unpredictability of stop-start government incentives for wind in the U.S. has led to a boom-bust market in recent years. While the main incentive to the industry, the Production Tax Credit, or PTC, expired at the end of 2013, new criteria mean projects that were started last year can still qualify so long as they finish construction by the end of 2015. The U.S. market is Vestas’s biggest historical market, accounting for almost a fifth of all deliveries through the end of 2012, according to the company’s data. Vestas has four factories there and a “very good uptick” in orders toward the end of last year means the Aarhus, Denmark-based manufacturer is hiring new workers in North America, Runevad said. Orders dropped steeply in the U.S. market at the beginning of 2013 because project developers in 2012 rushed wind farms to completion ahead of the scheduled expiry of the tax credit, an industry incentive. The PTC was then unexpectedly renewed, though the pipeline for new projects was empty. After installing a record 13,131 MW of wind turbines in 2012, the U.S. market then installed just 70.6 MW of new machines in the first three quarters of 2013, according to the American Wind Energy Association. (www.bloomberg.com)

January 24, 2014. Chancellor Angela Merkel’s clash with the European Commission over power-fee rebates to German industry is easing as support grows in her ruling coalition to follow European Union-favored guidelines for the aid. Lawmakers said they may agree to compensate companies by more closely following rules already in place under Europe’s emissions-trading system (ETS). That would reduce the number of big energy consumers eligible for rebates. The remarks indicate a softening of Germany’s stance as Merkel seeks to break an impasse in negotiations with the European Commission. The commission started a probe into the legality of the rebates to German companies from Bayer AG to Linde AG. The negotiations will determine the future cost of electricity for German companies after a compulsory premium they and consumers pay to finance the country’s clean-energy expansion jumped 18 percent to 6.24 euro cents (8.54 cents) per kilowatt-hour this year. While 1,716 German companies made savings of about 4 billion euros on rebates from that fee last year, the ETS compensation program would crimp their eligibility if applied. The ETS allows member states to apply to the EU to recompense companies for outlays on carbon dioxide emission certificates. Only a narrow band of energy-intensive industries that are exposed to global competition are eligible. They include steel, paper, chemicals, fertilizers and copper production. (www.bloomberg.com)

January 23, 2014. Sharp Corp, a Japanese electronics maker, will stop solar panel production at its factory in Tennessee as it reviews its photovoltaic panel business. Output will stop by the end of March, and the number of jobs to be cut at the plant in Memphis will be decided after talks with the labor union, Sharp said. As many as 300 employees are expected to be dismissed at the factory.

The Osaka-based company is reconsidering its production capacity for solar products, Sharp said. Sharp said that it will stop producing solar panels at its U.K. plant in Wales by the end of February and cut as many as 250 employees. The Tennessee plant, which employees about 450 people, will continue making other products such as microwaves, Sharp said. About 300 people are involved in solar production. (www.bloomberg.com)

January 22, 2014. For years, Europe has tried to set the global standard for climate-change regulation, creating tough rules on emissions, mandating more use of renewable energy sources and arguably sacrificing some economic growth in the name of saving the planet. But now even Europe seems to be hitting its environmentalist limits. High energy costs, declining industrial competitiveness and a recognition that the economy is unlikely to rebound strongly any time soon are leading policy makers to begin easing up in their drive for more aggressive climate regulation. The European Union proposed an end to binding national targets for renewable energy production after 2020. Instead, it substituted an overall European goal that is likely to be much harder to enforce. It also decided against proposing laws on environmental damage and safety during the extraction of shale gas by a controversial drilling process known as fracking. It opted instead for a series of minimum principles it said it would monitor. (www.nytimes.com)

January 22, 2014. The European Union (EU) proposed cutting the region’s greenhouse-gas emissions by 40 percent in 2030, accelerating its efforts to fight climate change. The European Commission’s strategy to reduce pollution, curb rising energy costs and overhaul renewable-energy policies in the next decade would require an average annual investment of 38 billion euros ($52 billion) in the 28-nation bloc. The current goal is to cut emissions by 20 percent in 2020 from 1990 levels, a pace that would lead the EU to a 32 percent reduction of greenhouse gases by 2030. The proposed design of future policies pits nations including Germany and the U.K., who are seeking stronger efforts to protect the atmosphere, against Poland and its allies, which rely mainly on fossil fuels to keep their economy humming. It also highlights the divide between energy intensive companies, whose gas and power costs are more than double their U.S. and Asian competitors, and green lobbies such as Greenpeace seeking deeper emission cuts. The strategy is the start of a debate among member states, which may lead to a draft law in early 2015. It also includes an EU-wide target to boost the share of renewables in energy consumption to 27 percent by 2030 and may include a pledge to boost energy efficiency later this year, the commission said. (www.bloomberg.com)

January 22, 2014. European utilities paying more to burn coal this winter is a sign of progress in Colombia, according to Alejandro Arias, whose environmental activism is helping provoke stricter pollution controls on miners. The 45-year-old lawyer photographed Drummond Co. loading coal on open barges a day after the practice was banned for spreading dust in the air over beaches and leading to spills in the Caribbean. President Juan Manuel Santos reacted by suspending exports and European thermal coal prices surged. Colombia supplies about 24 percent of Europe’s imported coal. In a country that spent the last decade inviting investors to its oil and mining industries while trying to extinguish a 50-year war against cocaine-funded rebels, Santos’ decision is being seen as a harbinger for a tougher stance on environmental protection. (www.bloomberg.com)

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