Energy News Monitor | Volume X; Issue 37

NEWS BRIEF

OIL & GAS

February 24, 2014. Reliance Industries Limited (RIL) had started oil and gas exploration in the controversial Krishna Godavari basin (KG basin) without obtaining mandatory environment clearance. The Ministry of Environment and Forest (MoEF) gave them post facto clearance. A year later, RIL proposed to change the number of wells to be drilled in each of the five blocks and even this was accepted by the ministry. Aam Aadmi Party leader Arvind Kejriwal has been raising uncomfortable questions regarding the favouritism shown to RIL on the issue of gas pricing. Post facto environmental clearances are a second case in point. RIL sought clearance in December 2001, but began work without getting the certificate and had even completed drilling in two wells by August 2002. Its clearance, however, came only in October 2002. One year after it got post facto clearance in October 2002, RIL changed the number of wells to be drilled in each of the five blocks in KG basin. In October 2002, RIL had taken clearance for eight wells for KGD6 block, which it changed to 18 in September 2003.  Similarly, for KG20, the proposed wells changed from six wells earlier to two wells in September 2003. The basin is divided into geographical areas and is termed as blocks. (www.hindustantimes.com)

February 19, 2014. British oil and gas major BP Plc has locked horns with Directorate General of Hydrocarbons (DGH) over undue charges being sought for surrendering an Andhra offshore block that has been squeezed down to 30% of the auctioned area due to defence restrictions. The block in question is identified as KG-D17 that Reliance Industries Ltd had won in the government's eighth round of auction. BP was given charge of operations in the block after the company's $7.2-billion deal to acquire 30% in concessions held by RIL. The dispute has arisen over DGH asking BP to pay costs on account of unfinished 'minimum work programme' (MWP), which runs into millions of dollars. BP has claimed the move contradicts the 'in-principle' agreement reached after several meetings in 2013 among company executives, oil ministry officials and DGH experts. The MWP has emerged as the point of dispute due to the defence ministry declaring 70% of the block's area as "impact zone" for planned defence projects. This, BP has argued, would heavily restrict operations for exploring or producing oil and gas. (timesofindia.indiatimes.com)

February 25, 2014. Indian Oil Corp. Ltd (IOC) will buy Malaysian firm Petroliam Nasional Bhd’s (Petronas) 10% stake in a shale gas assets and liquefied natural gas (LNG) project in British Columbia for $900 million. The acquisition of stake in Progress Energy Resources Corp. for 1 billion Canadian dollars ($900 million) marks IOC’s maiden entry into North America. IOC is buying 10% stake and the remaining 15% may go to a Chinese firm. In March 2013, it sold a 10% stake in the integrated shale gas development and LNG project to Japan Petroleum Exploration Co. Ltd (Japex) and another 3% to Petroleum Brunei. Petronas had previously announced that it plans to sell up to 50% of the Canadian project. After deals with Japex, Petroleum Brunei and the latest deal for 25% with firms such as IOC, it now has another 12% to offload. (www.livemint.com)

February 25, 2014. Reliance Industries Ltd (RIL), owner of the world's biggest oil refining complex, imported 14.2 per cent less crude in January compared with the previous month and continued to skip purchases from Iraq, trade data show. Reliance imported about 1.09 million bpd in January as it had cut runs at its older 660,000 barrels per day (bpd) plant by about 23 per cent from a year ago. Its purchases also eased last month as crude inventory had built up after an emergency shutdown of a distillation unit in December. The private refiner shipped in about 1.3 million bpd in December and a similar amount in January 2013, the data showed. Reliance operates two refineries at Jamnagar in Gujarat that can together process 1.2 million bpd oil. Reliance also made a rare purchase of Canadian heavy oil Cold Lake in January and bought Kazakhstan's CPC Blend for a second month in a row, the data showed. It was the third month in a row that it did not buy any Iraqi oil. In January Reliance perhaps for the first time received Venezuelan DCO, or diluted crude oil, a blend of extra heavy crude oil and heavy naphtha. Reliance has a term deal to buy as much as 400,000 bpd of oil from Venezuela, its top supplier, ahead of Saudi Arabia. Reliance continuously diversifies its crude slate, making new and rare purchases to take advantage of the complexity of its plants to improve margins by processing cheaper heavy grades. Reliance's imports from outside the Middle East included Merey, Leona and Hamaca from Venezuela; Maya from Mexico; Vasconia from Colombia; Peregrino, Albacora and Roncador from Brazil; Azeri Light from Azerbaijan; Ras Gharib from Egypt; Pazflor and Dalia from Angola; and Dar Blend from Sudan. It also buys oil from the Neutral Zone, a region whose production belongs to both Saudi Arabia and Kuwait. Grades from the joint area include Khafji, Ratawi, Houte and Eocene. (timesofindia.indiatimes.com)

February 25, 2014. Essar Oil, a key buyer of Iranian oil, in January sharply raised imports from Iran and also became the first Indian refiner to ship in the Brazilian heavy grade Polvo, tanker arrival data showed. India's oil imports from Iran more than doubled in January from a month earlier after sanctions on Tehran were eased due to an interim deal on its nuclear programme. Essar received 141,900 barrels per day (bpd) of oil from Iran last month, up from 54,200 bpd in December, according to the data. Shipments last month were about 31 per cent higher than a year ago. During the first 10 months of the fiscal year ending March 31, Essar imported 91,500 bpd oil, a decline of about 6 per cent from the same period the year before, the data showed. Essar purchased Polvo from Brazil as it has been testing new heavy grades to improve refining margins. (economictimes.indiatimes.com)

February 24, 2014. The government is likely to change policy for allocation of natural gas supplied from auctioned blocks by placing the gas-starved power sector after city gas in priority. Through a policy notification, it had ensured the demand for city gas distribution (CGD) networks is met entirely from cheaper domestic gas from blocks allotted outside the New Exploration Licensing Policy (NELP) regime. With this, fertiliser will have the first right, followed by liquid petroleum gas (LPG) and CGD, to natural gas produced from blocks awarded under NELP, including Reliance Industries Ltd’s KG-D6 block. Allotment to the fertiliser sector is currently capped at about 31 million standard cubic metres a day (mscmd), while that of power stands at 25 mscmd. The move might hurt 9,000 MW of power projects across the country that are under construction. India’s natural gas production has steadily declined over the past two years to 111 mscmd in FY13 from 143 mscmd in FY11, owing to a fall in production of the KG-D6 block. This is expected to be in the range of 130 mscmd by the next financial year. The government decided to raise allocation of natural gas from domestic fields to city gas entities to 100 per cent from 80 per cent. (www.business-standard.com)

February 24, 2014. Cooking gas distributors deferred their indefinite strike after assurance by oil marketing companies to look into their grievances. The nation-wide strike called by the All India LPG Distributors Federation (AILDF) and Federation of LPG Distributors of India (FLDI) was to begin and would have hit both domestic as well as commercial consumers. The strike was deferred after the oil companies promised to include distributors' representatives in a panel which would review the Marketing Discipline Guidelines (MDG) and make a representation to the oil ministry in 60 days, AILDF said. (www.newindianexpress.com)

February 23, 2014. Avantika Gas Limited (AGL) will set up six more CNG filling stations in Madhya Pradesh to meet the growing demand. At present, AGL, which is a joint venture of Gas Authority of India Limited (GAIL) and Hindustan Petroleum Corporation Limited (HPCL), has 14 CNG filling stations in the state. Besides, a new mother station will also be set up in Ujjain for supplying CNG to filling stations. Among the 14 existing CNG filling stations, 10 are in Indore while two each are situated in Ujjain and Gwalior supplying 44,000 kg CNG everyday. The demand of CNG is increasing in all these cities as it is not only cheaper than petrol and diesel but also environment-friendly and contributes a lot in reducing pollution. The company has also started supplying CNG to industries and at present 40 units are availing this facility. The AGL is also laying pipeline for supplying CNG to nearby Pithampur Industrial Area which will be completed soon. Till December 31, (third quarter) of the current financial year, the company earned a total revenue of ` 108 crore, which is 27.36 per cent more in comparison to ` 84.80 crore in the corresponding period last year. In 2012-13, the company had earned a revenue of ` 118 crore and which resulted in a net profit of ` 21 lakh. (economictimes.indiatimes.com)

February 25, 2014. India is ready to pay $1.5 billion to Iran to clear part of a backlog of payments for shipments of oil following the partial easing of western sanctions on Tehran, Oil Secretary Vivek Rae said. In a Nov. 24 deal with six major powers, Iran won access to $4.2 billion in oil revenue from a number of countries that has been frozen abroad. The funds will be paid in eight transfers on a schedule that started with a $550 million payment by Japan on Feb. 1. South Korea is set to make two payments in March totalling $1 billion and the next scheduled tranche of oil funds would come on April 10. Iran had sought $1.5 billion from India in back oil payments. The federal finance ministry is working out the banking channel that will be used for the payments, he said. Tehran is allowed to receive $450 million from India on March 1 if it satisfies targets set down in the November deal, according to the payment schedule. It can then receive two further tranches of $550 million on March 7 and April 10 without having to meet further conditions. (economictimes.indiatimes.com)

February 25, 2014. Reliance Industries' partners BP and Niko Resources may have to sell their share of gas from KG-D6 at the current rate of $4.2 per unit from April 1 while others would charge double the price, according the oil ministry's latest decision that is being examined by the law ministry. The oil ministry has argued that only Reliance Industries went to the government saying it is willing to furnish bank guarantees against an approval to charge the new rates based on the Rangarajan formula for the controversial block. The finance ministry and Parliament's standing committee on finance had objected to RIL charging new rates after the government held the company guilty of hoarding gas, leading to arbitration. The bank guarantee would be encashed if the government can prove its stated position that output from KG-D6 dropped sharply because the company deliberately suppressed production. (economictimes.indiatimes.com)

February 24, 2014. Oil Minister M Veerappa Moily has told Prime Minister Manmohan Singh that Reliance Industries' contract for KG-D6 gas fields cannot be terminated pending arbitration on issue of output lagging targets. Moily in a 13-page letter to the Prime Minister explained the process, the contractual requirement and the steps followed for raising natural gas prices from April 1, without which several gas fields of both private sector firm RIL and ONGC would be economically unviable to produce. Rebutting allegations by the Aam Aadmi Party (AAP) and its leader Arvind Kejriwal that the price increase was done to benefit RIL, Moily wrote to Singh saying ONGC's average cost of producing natural gas was about USD 3.6 per million British thermal unit in 2012-13 and its newer finds in deepsea cost more than current rate of USD 4.2. Public sector firms ONGC and Oil India Ltd (OIL) account for about 80 per cent of India's gas production and will be the major beneficiary of gas rates going up from USD 4.2 to USD 8. Kejriwal before resigning as the Chief Minister of Delhi had ordered the Anti-Corruption Bureau to register an FIR against Moily, RIL and its Chairman Mukesh Ambani for allegedly creating an artificial shortage of gas in the country and raising prices. On gas production from RIL's eastern offshore KG-D6 gas fields lagging targets since 2010-11, Moily told Singh about the process initiated by his predecessor S Jaipal Reddy of penalising the firm by disallowing a portion of cost incurred. While the contract provides for termination in case of a default by a contractor, Reddy in May 2012 had slapped penalty of USD 1.005 billion. RIL disputed the penalty and initiated arbitration. He has challenged Kejriwal's claim that cost of producing gas from the deepwater field is less than $1 per unit. The oil minister has ruled out termination of RIL's contract with the government for the KG-D6 block, where output has fallen sharply and the government has blamed the company for deliberately suppressing production by not drilling the required number of wells. The oil ministry has imposed a financial penalty on Reliance for the shortfall in production. However, the company has initiated an arbitration against this because it blames the geology for the fall in gas production. He has informed the prime minister that the Production Sharing Contract (PSC) clearly states that such action cannot be taken while arbitration is going on. Another justification for higher rates is that the current price makes some fields unviable, and will force the country to increase imports of costly LNG. The Oil ministry said many discoveries of ONGC, RIL and Gujarat State Petroleum Corp (GSPC) are not viable at the prevailing gas price. Moily argued that the BJP-led government in the past had opted for market-linked prices. He also said that oil companies need to recover the drilling cost of many wells, including those that turn out to be dry. (economictimes.indiatimes.com)

February 22, 2014. Oil Minister Veerappa Moily told Parliament that even those who do not have an Aadhar card are entitled to buy the allocated quota of subsidised LPG cylinders. After government raised the quota of LPG cylinders from 9 to 12 cylinders per household per year, it delinked the Direct Benefit Transfer (DBT) as subsidies need to be recaliberated. The government was transferring ` 435 per cylinder to every beneficiary but now the subsidy component has increased to ` 700 per cylinder. Moliy informed the House that the clarification on delinking Aadhar account from disbursal of subsidised LPG cylinders would be issued. He said there have been some problems in DBT programme, mainly related to banks, which have been given ` 435 per cylinder (for subsidy) which is not enough since the subsidised price of one cylinder has increased to ` 700. He also emphasised that the government has not increased the price of subsidised cylinders for consumers.  Under DBT, about 4.86 crore accounts have been made and around 2.06 crore households have received subsidised cylinders. Moily informed that every year an average of one crore new LPG connections are given, mostly in rural areas. Answering a query the oil minister said the government would think of a new scheme to ensure that LPG connections reach people, especially to those Below Poverty Line (BPL), at the earliest. He also noted that about 96 per cent of BPL families use less than six LPG cylinders a year on a single family basis. Noting that about 60 per cent of people are covered by LPG and PNG connections, Moily said the idea is to make the coverage 100 per cent. The government, if required, is ready to open more outlets and kendras for gas connections, he said. (www.newindianexpress.com)

February 19, 2014. Oil Minister M Veerappa Moily has ordered CNG retailers to provide break-up of fuel price to consumers to ensure that they passed on the benefit of cheaper domestic gas to users. Compressed natural gas or CNG sold to automobiles and natural gas piped to household kitchens will be the first fuel where consumer will get invoices providing break-up of price. Presently, no break-up of price of petrol, diesel, LPG or kerosene is provided to consumers. Moily had rejigged supplies to ensure that city gas companies got cheaper domestic gas to meet all of their requirements for CNG and piped natural gas (PNG) supplied to households for cooking purposes compared with the previous limit of 80 per cent for most states. This led to a steep ` 14.90 per kg cut in price of compressed natural gas or CNG and ` 5 per kg reduction in rates of cooking gas piped into kitchens in Delhi. (economictimes.indiatimes.com)

February 19, 2014. Former Delhi Chief Minister and Aam Aadmi Party (AAP) leader Arvind Kejriwal may find a good support in Tripura’s Power Minister Manik Dey in his tirade against the Union Government’s decision to raise natural gas prices. While Kejriwal questions alleged corruption in the decision to almost double the price of domestically produced gas, the Tripura Government will be among the worst-hit by the price rise as over 90 per cent of electricity consumed in the State is gas-based. The rest is hydro-electric. In contrast, the national share of gas-based power generation capacity is a mere 9 per cent. Beginning June 2010, gas prices have increased three times in Tripura. First came a revision in prices from ₹ 2,376 to ₹ 4,700 a cubic metre. It further moved up to nearly ₹ 7,700 a cubic metre, after the rupee started falling last year. From April, the gas prices will rise further and cross ₹ 10,000 a cubic metre. (www.thehindubusinessline.com)

POWER

February 23, 2014. NTPC will set up a 1,320 MW power project in Bihar entailing an investment of ` 9,200 crore. In this regard, a Memorandum of Understanding (MOU) was inked between NTPC, Bihar State Power Generation Company Ltd (BSPGCL) and Lakhisarai Bijlee Company Private Ltd (LBCPL). The country's largest power producer would develop a 1,320 MW Kajra thermal project in Lakhisarai district of Bihar. The plant would have two units of 660 MW each. In the joint venture, NTPC would have 74% stake and the rest would be with BSPGCL. Currently NTPC has an installed power generation capacity of more than 42,000 MW. (www.business-standard.com)

February 22, 2014. The Jammu and Kashmir (J&K) government has framed a roadmap for generation of 9,000 MW hydro power by 2021, Minister of State for Power Vikar Rasool said. The Minister said the government has framed a roadmap for generation of 9000 MW hydro power during the 12^th and 13^th Plan in the state. He said that in this regard, J&K Hydro-Electric Projects Development Policy 2011 has been notified to encourage participation of the private sector. Rasool said with the implementation of the policy, a roadmap envisaging addition of around 9000 MW power by up to 2021 has been drawn up to increase the generation capacity. Under Rajiv Gandhi Grameen Vidyutikaran Yojana, upgrading of power infrastructure in all districts, especially in rural and hilly areas, received focused attention, the Minister said. (www.business-standard.com)

February 20, 2014. The Kudankulam Nuclear Power Plant's first unit would reach its full capacity of producing 1,000 MW of power soon. The first unit is now generating 75 per cent of its capacity. It would reach 100 per cent "shortly". The country's first 1,000 MW pressurised water reactor of the Indo-Russian joint venture project attained criticality in July last year and commenced electricity generation in October. The 1000 MW second unit is likely to attain criticality by June. The commissioning of the plant was delayed considerably due to the protest spearheaded by the People's Movement Against Nuclear Energy. (economictimes.indiatimes.com)

February 19, 2014. NTPC, which laid the foundation stone for a 1,600 MW power plant in Madhya Pradesh (MP), plans to set up two more projects in the state. NTPC already has a few projects in Madhya Pradesh, including the 4,260 MW Vindhyachal thermal power station. One more unit of 500 MW is under construction at Vindhyachal. The company is also working on a 50 MW solar plant at Rajgarh in the state. The company plans to set up two more projects at Khargone and Barethi in Madhya Pradesh, NTPC said. Power Minister Jyotiraditya Scindia laid the foundation stone for the first 800 MW unit of Gadarwara project. The plant would have two units of 800 MW each. According to the Minister, the project would ultimately have a generation capacity of 3,200 MW entailing a total investment of nearly ` 25,000 crore. (economictimes.indiatimes.com)

February 25, 2014. State run bulk power purchaser, Gridco aims to procure 25,829.57 million units (mu) of electricity from different sources at a total cost of ` 6,542.41 crore to meet the electricity demand of the state during the next fiscal. Gridco aims to purchase 18,076.47 mu from the state sector while 7,753.10 mu will be procured from the central utilities. The break-up figures of power purchase from the state sector includes 5,764.16 mu from Odisha Hydro Power Corporation (OHPC), 11,697.31 mu from thermal plants, 615 mu from renewable sources.  The bulk power trader has projected its annual revenue requirement (ARR) at ` 8,445.70 crore before the Odisha Electricity Regulatory Authority (OERC) against ` 6,112.5 crore approved by the commission for the current fiscal. ARR includes power purchase cost of ` 6,542.41 crore, pass through expenses of ` 429.22 crore, financial cost of ` 1,374.47 crore and miscellaneous cost of ` 99.60 crore. As per the Electricity Act, 2003, the electricity tariff is determined on annual basis by OERC for generation, transmission and supply of electricity considering commercial viability and operational efficiency of the utilities. The OERC is expected to give its verdict on tariff revision on March 23 and the new rates will be effective from April 1, 2014. (www.business-standard.com)

February 25, 2014. In a bid to ensure stable and uninterrupted supply of power in the city, the state energy department plans to implement State Capital Region Improvement in Power System (SCRIPS) scheme at an investment of ` 1,500 crore. The scheme, aiming to provide stable and uninterrupted power to the consumers in Bhubaneswar, involves massive overhaul of power transmission and distribution infrastructure. (www.business-standard.com)

February 24, 2014. The government panel did not carry out "in depth" investigations into the technical issues that caused the failure of electricity grids in July 2012, power sector watchdog Central Electricity Regulatory Commission (CERC) has said. It has called for detailed analysis of the incident, saying that several states had failed to comply with norms. CERC's observations come over 18 months after the massive collapse of grids that affected power supplies to about half of the country's population. Overdrawal of electricity by some states was cited as one of the reasons for the crisis. The high-level committee on grid disturbances, in its report last year, had said that no single factor was responsible for the problems. As per that panel's report, "overdrawal by some of the Northern Region utilities" and multiple outages of transmission lines were among the reasons for collapse of grids. According to the 112-page order, there are some violations which are specific to the grid disturbance which need to be addressed. In this regard, the Commission would be issuing notices to them as per provisions of Electricity Act, 2003. Considered one of the worst collapses, the Northern grid had tripped on July 30, 2012 resulting in massive outages. The very next day, Northern, Eastern and North Eastern grids had failed. Following the collapse, CERC had directed CEOs of Power System Operation Corporation Ltd's CEO and Power Grid Utility (CTU) to investigate the grid failures. A report in this regard was submitted to the Commission in August 2012. The report found skewed Load Generation Balance across the regional grids and grid indiscipline, among other factors as cause for the failure. Based on the findings, CERC on November 16, 2012 had sought responses from various stakeholders. (economictimes.indiatimes.com)

February 20, 2014. Power distribution firms are preparing for the surge in summer demand from households but this may not be a headache for state governments on the eve of general elections because electricity prices are likely to be stable because of subdued industrial demand and addition to generation capacity. In short term market, electricity distribution companies (discoms) sign agreements with producers for less than a year. Volume of electricity trade doubled on Indian Energy Exchange (IEX) between 2011 and 2013.

Demand for electricity goes up by 5-25% during the summers, particularly in urban areas, due to higher consumption of power for cooling purpose. Also, commercial and residential activities end in the late evening compared to winters. For instance, peak demand for electricity crossed 17,000 MW in May last year compared to an average demand of 10,000 MW in January 2013. Maharashtra's principal secretary Vidhyadhar Kanade said the state has already made necessary arrangements to meet the higher electricity demands for summers. To avoid tying up for access or less power, discoms are also increasingly using modern tools to project electricity demands. According to Tata Power Delhi Distribution Ltd (DDL), rise of one degree in temperature compared to previous year may push electricity demand up by 50 MW in market like Delhi that has probably highest per capita power consumption in the country. Tata Power DDL meet peak demands by procuring power from Madhya Pradesh, Jammu & Kashmir and Himachal Pradesh that have excess power between June and September due to higher generation of hydro power. Delhi's power consumption is highest between 1 pm to 4 pm and 11 pm to 1 am. (economictimes.indiatimes.com)

February 20, 2014. ABB, a leading power and automation technology group, said it has won orders worth around ` 310 crore from Power Grid Corporation of India Ltd to supply power transformers and shunt reactors. The supply will be for substations being built to support the country's ultra-high voltage transmission grid development, the company said.

ABB said India is investing in its ultra-high voltage network to strengthen its power transmission grid and the company is playing a key role in supporting this development through turnkey substation solutions and a range of power products, including switchgear and transformers. Fourteen 500 megavolt ampere (MVA), 765 kilovolt (kV) ultra-high voltage single-phase auto-transformers based on ABB's proven technology will be installed at greenfield sub-stations being constructed in Kanpur and Varanasi. These substations will receive power from neighboring states of Jharkhand and West Bengal and distribute it in Uttar Pradesh to meet growing demand in the region. ABB will also supply 26 units of 80 MVA and 10 units of 110 MVA, 765 kV ultrahigh voltage single phase shunt reactors for four substations being built in southern and eastern India. (economictimes.indiatimes.com)

February 20, 2014. The government deferred a decision on supply of coal to some thermal power projects with tapering linkages beyond the three-year period. Tapering Linkage is short-term linkage provided to those consumers who have been allocated captive coal blocks but the mines could not be developed on time. The Cabinet Committee on Economic Affairs (CCEA) approval is needed with regard to supply of coal for six power units with tapering linkages, a source has said declining to share the names of the units. The government had approved more coal supply to nine power projects, including those of GMR and Sterlite which failed to develop mines allocated to them due to environment-related hurdles. (www.business-standard.com)

February 25, 2014. The power consumers of Gujarat, Haryana, Maharashtra, Punjab and Rajasthan will have to pay as much as 10 paise per unit more, according to the estimates of rating agency ICRA. This is the impact of the central power regulator's new order allowing Tata Power and Adani Power to increase the tariff of power sold to distribution companies. The two power projects of Adanis and Tatas both located at Mundra, source coal from Indonesia. The country changed its laws, benchmarking the coal sale prices to international levels. (www.business-standard.com)

February 25, 2014. Maharashtra Chief Minister (CM) Prithviraj Chavan said 15,000 consumers of Reliance Infra recently shifted to Tata Power in the city. Chavan said that 15,000 consumers whose monthly consumption was upto 300 units had shifted to Tata Power whose tariffs are lower compared to Reliance Infra. Mumbai consumers get power supply from Tata Power, Reliance Infrastructure and BrihanMumbai Electric Supply and Transport undertaking. (economictimes.indiatimes.com)

February 25, 2014. The Reliance discoms in the capital will have to figure out a new way to manage their finances. The Delhi government under the President's rule has decided to adjust the subsidy amount that it owes to BSES Yamuna and BSES Rajdhani against the discoms' outstanding dues to the entities owned by the government. The Delhi government owed BSES Rajdhani ` 37 crore and BSES Yamuna to ` 25 crore for subsidy in the last quarter. For the new subsidy from this quarter, the BSES discoms are supposed to get ` 228 crore, which would be adjusted against the discoms' outstanding dues of approximately ` 4,000 crore to Transco, IPGCL and PPCL as transmission and generation costs.

The discoms had written to the government, requesting it to pay the dues to them as both were facing an acute financial crisis. Both discoms even suggested that the government pay this amount directly to NTPC against the BSES discoms' pending dues to the national power generator. The Reliance discoms have been defaulting on payment to these entities for the past several years, but the Delhi government is wary of cutting supply to them, fearing it could lead to blackouts in the capital. With the government adjusting almost ` 290 crore in the outstanding amount, at least a portion of the discom arrears would be cleared. The BSES companies are now banking on the civic bodies to clear the dues for streetlight maintenance. The situation is being closely monitored by the regulatory body Delhi Electricity Regulatory Commission (DERC), which has already asked the discoms to explain their financial position and how they plan to continue supplying power to Delhiites in their current situation. (economictimes.indiatimes.com)

February 25, 2014. Central Electricity Regulatory Commission’s (CERC) recent regulation on electricity tariff underscores the strides taken by the power sector over the years. Apart from fixing the manner in which tariff will be calculated over the next five years, CERC’s regulation demonstrates the maturity of the regulator in taking hard decisions. The mission statement of Central Electricity Regulatory Commission (CERC) states that it is expected to promote competition, efficiency and economy in bulk power markets, improve the quality of supply, promote investments and advise government to remove barriers to bridge the demand supply gap and thus foster the interests of consumers. Thus when India was a power deficit nation and desperately needed investment in the sector, CERC offered a minimum return of 15.5 per cent return on equity (almost double the risk free return in the country) and offered liberal return over and above this figure. The regulator allowed power generating companies to charge higher taxes to consumer but pay lower (actual) taxes to the government. NTPC earned nearly ` 850 crore through this arbitrage. CERC’s idea was to promote investment and supply of electricity in the initial years and did not mind generating companies earning some extra money. (www.business-standard.com)

February 25, 2014. The latest order by Central Electricity Regulatory Commission (CERC) dated February 21 regarding the continuation of the methodology for determination of compensatory tariff for Adani Power's 4,620 MW Mundra Thermal Power Plant to its previous order of April 2013 allowing tariff revision by Tata Power may put the Haryana power utilities in a tight spot. The CERC has ordered approximately ` 409.51 crore compensation from Haryana for Adani Power from the commissioning date till March 31, 2013. The amount is to make up for the losses incurred by the Adani project in the wake of Indonesian regulation on higher cost of imported Indonesian coal.

The power utilities in Haryana are already reeling under ` 18,000 crore of short-term liabilities as on 31 March, 2012. In January 2014, the Bhupinder Singh Hooda led Congress Government in the state announced a tariff relief for the residents of the state by committing to no power tariff revision in the financial year 2014-15. (www.business-standard.com)

February 24, 2014. Punjab and Haryana discoms said they are studying the CERC orders allowing Tata Power and Adani Power to recoup losses and increase tariff on electricity generated from Mundra projects. They said they are working out the actual "financial burden" before taking any call on the issue that pertains to recovery of losses on account of costlier imported fuel from power purchasing states. The power distribution companies might hold "mutual consultation" with discoms of other affected states for taking a final decision on this issue. Punjab is getting 475 MW of power from Tata Power's 4,000-MW Mundra project in Gujarat. Haryana has a share of 300 MW of power from Tata Power's project and 1,400 MW from Adani Power project. (economictimes.indiatimes.com)

February 24, 2014. Changes are on the anvil in the way incentives and tax liabilities get calculated for central power generation and transmission firms as electricity regulator CERC has notified new tariff regulations.

The new norms will be in force for five years - from April 1, 2014 to March 31, 2019. They are not applicable to generating stations or inter-state transmission systems where tariffs has been discovered through competitive bidding. As per the new norms, notified by the Central Electricity Regulatory Commission (CERC), there are key changes with regard to tax and calculation of incentives for thermal power plants. (economictimes.indiatimes.com)

February 22, 2014. Subsidy for consumption up to 400 units, announced by the Sheila Dikshit government and later increased by the Arvind Kejriwal government, will cease in the new financial year as there is no provision for it in the interim budget for 2014-15 approved by Parliament. On December 31, 2013, Kejriwal had slashed electricity rates by 50% for consumption up to 400 units. The Congress government had also been subsidizing the first two slabs of 0-200 units and 201-400 units. The Delhi cabinet had approved the subsidy for the January-March quarter and it was to be reviewed as the government had ordered a CAG audit of power companies. The state government had also prepared an estimate of ` 669 crore for power subsidy in the April-September period but, this did not figure in the 'vote on account' approved by Parliament. Delhi was allocated ` 18,033 crore for the first 6 months of 2014-15 in a vote on account tabled in Parliament. Budget estimates of ` 36,066 crore were approved in the interim budget. The amount includes ` 17,000 crore for plan expenditure and ` 19,066 crore for non-plan expenditure. Parliament also gave its nod for grants of ` 363 crore to pay for the power subsidy till March 31. The Delhi Appropriation and Vote on Account Bills were passed by voice vote in both the houses. Parliament's nod for these bills was necessary as the Delhi assembly could not pass the budget for financial year 2014-15 before President's rule was imposed. Minister of state for finance, Namo Narain Meena, made it clear that no allocation has been made in the current budget for subsidies announced by the previous government. For the financial year 2013-14, Parliament approved a revised Delhi budget of ` 35,424 crore, as against the budget estimates (BE) of ` 37,450 crore. The saving was made possible by reduction in non-plan expenditure. The revised non-plan expenditure is ` 20,274 crore, down from ` 21,000 crore in the BE. (timesofindia.indiatimes.com)

February 21, 2014. The Aam Aadmi Party (AAP), which launched a campaign against alleged malpractices by power distribution companies in Delhi after coming to power, has now turned its attention to Mumbai and Maharashtra, alleging a loss of ` 22,000 crore due to corruption, but the state utility and Reliance Infrastructure rubbished the allegations as false and baseless. A day after launching its Lok Sabha election campaign in Maharashtra , AAP released a document named 'Mahagenco Ka Maha Power (Pawar) Ghotala' , targetting the state's power minister Ajit Pawar. Satish Jain, member of AAP's Maharashtra executive committee, demanded an inquiry into alleged corruption and inefficiency and said power bills can be halved if distribution is set right. Mahagenco and Reliance Infra vehemently denied the allegations. AAP said the state had lost ` 12,000 crore since the power generation company Mahagenco sourcing lesser coal from Coal India than the contractual quantity , allegedly helping officials get kickbacks by buying coal from other sources. AAP went to say the state's regulatory body had been headless for four years though VP Raja was the chairman from December 2008 to September 2013 and the seat has been vacant only for five months. AAP said that Mahagenco has spent ` 10,000 crore in the last five years without any increase in capacity but Sharma said the utility had added 2,500 MW of new capacity , but retired old projects of 1,000 MW, helping it generate revenue of ` 12,557 crore. (economictimes.indiatimes.com)

February 20, 2014. Coal India Ltd (CIL) has conveyed to analysts its FY15 coal output will be lower than the earlier projection of 530 million tonnes (mt). Irrespective of what the government says, environmental clearances continue to be a problem and this will cap FY15 coal production at 507 mt, which would be a 25-30 mt growth over the current financial year. This implies CIL’s output in FY14 will be no more than 470-475 mt. At the start of the current financial year, CIL had estimated its FY14 production to be 492 mt. (www.business-standard.com)

February 20, 2014. Power Finance Corp (PFC) and Rural Electrification Corp (REC) have disbursed transitional loans worth ` 33,694 crore to state-owned power distribution companies, the government said. Besides, the two state-owned power sector lenders have together subscribed to Uttar Pradesh Power Corp Ltd's (UPPCL) bonds worth ` 2,612 crore. Power Minister Jyotiraditya Scindia said that PFC and REC have given transitional loans amounting to ` 33,694 crore to state-owned power distribution companies. The government is also implementing a financial restructuring plan for discoms. Under the plan, state government would take over 50 per cent of outstanding short term liabilities of the discoms as on March 31, 2012. The remaining half would be rescheduled by the lenders with moratorium on principal payment. Scindia further said that so far ` 7,142.61 crore has been disbursed to discoms under the Restructured APDRP (Accelerated Power Development and Reform Programme). (economictimes.indiatimes.com)

February 20, 2014. The Uttar Pradesh (UP) government has put on fast-track, proposed coal-fired energy projects totalling 5,280 MW to tide over the persistent power crisis. These projects include, Bara (1,980 MW), Meja (1,320 MW) and Ghatampur (1,980 MW) thermal power projects scheduled for commissioning during 2014-15, 2015-16 and 2017-18 respectively. The Akhilesh Yadav government is targeting augmenting power generation capacity by over 12,000 MW with the help of private and state sector projects by 2017. (See table).

Sl No	Name of project	Capacity (MW)	Commissioning
1	Anpara D	1,000	2014-15
2	Srinagar Jal Vidyut Pariyojna	330	2014-15
3	Bara thermal project	1,980	2014-15
4	Lalitpur thermal project	1,980	2015-16
5	Central sector	1,000	2013-17
6	Case I bidding	6,000	2016-17
Total		12,290

This seems a tall order in prevailing situation, when most projects have failed to make any significant strides. Besides, there is lingering problem of getting coal linkages for the proposed projects. During the Mayawati regime, the government had signed memorandum of understanding (MoUs) for setting up power projects totalling 10,500 MW in private sector. However, these companies could not secure coal linkage. The UP government on June 7, 2012 granted 18 months to these companies to secure the coal linkage. Recently, these companies were again provided time for the same. With such ambitious goals, the government is aiming to provide 24-hour and 16-hour electricity supply in urban and rural areas, respectively by 2016-17, when the state would witness Assembly elections. (www.business-standard.com)

February 20, 2014. Government is considering "suitable amendments" to the electricity tariff policy which would benefit various categories of consumers, the Power Ministry said. The draft amendments in the Tariff Policy were put out for public comments last September. Power Minister Jyotiraditya Scindia said that suitable amendments are under finalisation with regard to tariff policy. (economictimes.indiatimes.com)

February 19, 2014. The Delhi High Court (HC) asked Lt. Governor (LG) Najeeb Jung not to take any further decision on the AAP government's announcement to give 50% waiver on pending electricity bills of 24,036 consumers. These consumers had stopped payment of their dues during their Aam Aadmi Party's "bijli satyagraha". A division bench of Acting Chief Justice B.D. Ahmed and Justice Sidharth Mridul directed the Delhi government to clarify whether the cabinet has taken any decision on waiver of pending electricity bills. Meanwhile, it also asked the Lt. Governor not to take further decision on waiver of power bills. The bench was hearing a the public interest litigation (PIL) filed by advocate Vivek Narayan Sharma, who also sought quashing the Delhi government's decision to close power theft cases registered against 2,508 consumers last year. The plea said that such action of the government was like "sponsoring and abetting criminal/terrorism acts and acts against rule of law and constitution". Shortly after its formation, the Aam Aadmi Party (AAP) launched 'bijli satyagraha' alleging that power bills in Delhi are inflated and as part of the campaign, Kejriwal urged people of Delhi to stop paying their power bills, the plea said. About 24,036 consumers in Delhi stopped paying their power bills in Delhi, reportedly from October 2012 to December 2013. During this period, the authorities disconnected a total of 2,508 electricity meters for non-payment of bills and these people started to steal power. The PIL said numerous theft cases were initiated and are pending in the courts. (www.usiness-standard.com)

OIL & GAS

February 25, 2014. Iraq has approved major contract items for Eni's giant oilfield project in its south, just hours after the Italian company threatened to pull out if red tape was not cut and Angola's Sonangol quit projects in the north due to security concerns. Italy's Eni was seeking swift approval for contracts to push the Zubair oilfield, now pumping about 320,000 barrels per day (bpd), towards a target of 850,000 bpd. Two such contracts for de-gassing stations at Zubair, worth about $1 billion in total, received cabinet approval. A third contract requires minor follow-up with Eni. (www.rigzone.com)

February 19, 2014. U.S. explorer Apache Corp expects to start production at a new oilfield offshore northwest Australia by the end of the second quarter. Apache has leased floating production storage and offload unit (FPSO) Armada Claire from Bumi Armada to produce light sweet crude from the Balnaves oilfield. Balnaves has a field life of about 5 years, with production expected to peak at 30,000 barrels per day (bpd), Apache had said. Apache operates the project with a 65 percent stake while Kuwait Foreign Petroleum Exploration Co holds 35 percent. (www.rigzone.com)

February 25, 2014. Ghana's sole refinery, the Tema Oil Refinery, is close to signing a joint venture (JV) agreement with PetroSaudi International and a deal is expected soon, Ghanaian President John Mahama said. The 45,000 barrels-per-day plant has been hobbled by repeated shutdowns in the last four years, often due to a lack of funds to procure crude for processing. (www.arabianbusiness.com)

February 24, 2014. Iraq has held a ceremony marking the start of construction of a large oil refinery aimed at meeting increasing demand for refined products. Oil Ministry said that a Korean consortium led by Hyundai Engineering & Construction will build the 140,000 barrels-per-day refinery in the central province of Karbala over a 54-month period. Four other Korean companies have teamed up with Hyundai. The engineering, procurement, and construction deal is valued at $6.04 billion. The refinery will produce gasoline, gas oil, fuel gas, liquefied gas, jet fuel, and asphalt. The refinery is one of four new sites Iraq plans to build to boost refining capacity by 750,000 barrels per day. (www.downstreamtoday.com)

February 23, 2014. Petrofac, the international oil and gas services provider, has been awarded a contract by BP, worth $1.2 billion, for the Khazzan gas project in Oman. The scope of work will include engineering, procurement and construction of the central processing facility (CPF) at the Khazzan field. The CPF will include two process trains, each having a capacity of 525 million standard cubic feet of gas per day, Petrofac said. The project also includes an associated condensate processing system, power generation plant, water treatment system and all associated utilities and infrastructure. The project is expected to be completed in 2017. Petrofac said a joint venture with South Korea's Daelim Industrial Co had won a $2.1 billion contract for a refinery project from Oman Oil Refineries and Petroleum Industries Company. (www.arabianbusiness.com)

February 25, 2014. Canada’s National Energy Board is investigating whether some steel pipe and fittings on TransCanada Corp.’s Keystone oil pipeline are below standards. The board began the work after its U.S. counterpart, the Pipeline and Hazardous Materials Safety Administration, started a similar study. TransCanada, based in Calgary, delivers crude from Alberta’s oil sands on its 2,639-mile (4,247-kilometer) Keystone system to U.S. Midwest and Gulf Coast markets. The company is seeking approval from President Barack Obama to build the northern cross-border leg of its Keystone XL line, a $5.4 billion project that environmental groups oppose, saying it will worsen climate change. Keystone has safely delivered more than 560 million barrels of oil since 2010. The National Energy Board mentioned the investigation in a report on its audit of TransCanada’s integrity management programs. The pipe and valve investigation preceded the audit, which began in November 2012. (www.bloomberg.com)

February 25, 2014. A barge crash that spilled enough oil to temporarily shut a stretch of the Mississippi River highlights the transportation risks of the U.S. energy boom just as regulators respond to several rail accidents involving crude. A 65-mile portion of the river about 50 miles (80 kilometers) upstream from New Orleans reopened with restrictions as federal and state officials responded to a Feb. 22 spill, which stalled shipments of goods including grain and chemicals on the nation’s busiest waterway. A surge in U.S. oil production, reflecting in part advances in drilling techniques, has unlocked millions of barrels of oil from geologic formations such as North Dakota’s Bakken shale, reducing U.S. reliance on imports. It has also ignited a debate over how to safely get the oil to refineries after a series of rail accidents involving oil tank cars, including a July derailment that killed 47 in a Quebec city. Backers of TransCanada Corp.’s proposed Keystone XL project from Alberta to the U.S. Gulf Coast have said expanding pipeline capacity would be the safest means to transport crude. (www.bloomberg.com)

February 19, 2014. Woodside Petroleum Ltd., Australia’s second-largest oil and natural gas producer, reported full-year profit fell 17 percent after a delay in restarting an oil project and a drop in sales. Underlying profit was $1.7 billion, down from $2.06 billion a year ago, Perth-based Woodside said. Underlying profit, adjusted for writedowns, was $1.92 billion, the company said. The median estimate of eight analysts surveyed was $1.89 billion. Woodside is pushing ahead with overseas expansion after delays at its proposed Browse and Sunrise liquefied natural gas ventures in Australia. Talks with customers of the A$15 billion ($13.5 billion) Pluto LNG venture resulted in higher prices for as much as 75 percent of sales, it said. The new prices are expected to apply to about 25 percent of Pluto sales in the first quarter of 2014 and 35 percent in the second quarter, the company said. Those prices will apply to about three quarters of sales starting in the third quarter, Woodside said. (www.bloomberg.com)

February 19, 2014. Saudi Arabia, the world’s biggest crude exporter, probably needs to boost shipments this year to keep pace with record government spending, according to a former adviser to the nation’s finance ministry. The country needs to at least match the 7.54 million barrels a day it shipped last year and will probably need to sell more, Riyadh-based MASIC, an investment company, said. Extra shipments could be negative for oil prices because of expanding supplies elsewhere. Iran, Iraq and Libya, among countries with the world’s biggest reserves, will pump more crude this year, according to the most accurate forecasters surveyed. Saudi Arabia is known as a swing producer as it alters supply depending on demand. (www.bloomberg.com)

February 25, 2014. President Barack Obama told governors that a decision over whether to approve the Keystone XL oil pipeline from Canada probably will be made within “a couple” of months. Governors Mary Fallin of Oklahoma and Bobby Jindal of Louisiana, both Republicans, said that Obama told them today of the timetable without indicating how the administration would decide. TransCanada Corp. of Calgary applied more than five years ago for a permit to build the $5.4 billion pipeline through the U.S. heartland, connecting oil sands in Alberta with refineries along the coast of Texas and Louisiana. The 875-mile pipeline would run from the U.S.-Canada border to Steele City, Nebraska. From there it would connect to an existing pipeline network. (www.bloomberg.com)

February 24, 2014. Prime Minister Dmitry Medvedev said any extension of a gas agreement between Russia and Ukraine would have to be negotiated between Ukrainian companies and the government. The decision in the gas sphere, which was adopted, has concrete time periods for implementation. What will happen after these expire, is a question for discussion with the leadership of Ukrainian companies and the Ukrainian government if one emerges there. (www.downstreamtoday.com)

February 24, 2014. U.K. Prime Minister David Cameron will pledge measures to boost North Sea oil extraction as his cabinet meets in Aberdeen in a bid to counter the campaign for Scottish independence. The U.K. will commit to greater collaboration with industry to share infrastructure and will award production licenses on the basis of maximum petroleum recovery. A new independent regulator to supervise licensing and ensure industry collaboration will be created. (www.bloomberg.com)

February 24, 2014. Iran will offer foreign partners incentives to find and pump more crude and natural gas and will pay some fees in barrels as it seeks to boost income once international sanctions are lifted. New contracts Iran is developing will offer higher fees for riskier exploration and production projects, oil-ministry said at a conference in Tehran. Local and international executives attended a two-day meeting to discuss rules that would govern oil and gas production if Western curbs on Iranian energy exports are removed. The committee revising the Islamic republic’s contract model presented terms called the “Iran Petroleum Contract.” The country probably wouldn’t be able to complete any new oil-investment contracts until at least the middle of 2015, given the minimum time needed for the two sides to conclude nuclear talks and for the U.S. and its allies to potentially lift sanctions. Under the proposed terms, state-run National Iranian Oil Co. (NIOC) will form joint ventures for crude and gas production with international companies to manage projects, provide financing and maximize hydrocarbon recovery. Partners conducting exploration projects will be paid for their work with a share of the output, according to presentations at the conference. The companies, which would have no rights over the reserves, would be able to report output they receive as payment once a field reaches its production targets and after exploration is complete. Russia’s OAO Gazprom, China National Petroleum Corp. and Malaysia’s Petroliam Nasional Bhd., or Petronas, were among a dozen foreign firms the organizers said attended the conference. Western European companies were not present. International companies will act as the sole operator at oil and gas exploration blocks and will be responsible for the risks of those projects. NIOC may be a technical partner in the developments. The ventures will have 15 to 20 years to pump oil after seven to nine years of exploration under the new contracts. (www.bloomberg.com)

February 19, 2014. South Sudanese rebels and government forces fought for control of the capital of oil-rich Upper Nile state, the only region in the world’s newest nation that’s still producing crude two months after violence erupted. South Sudan, which gained independence from Sudan in July 2011, has sub-Saharan Africa’s third-biggest oil reserves, according to BP Plc data. While oil production has been halted in Unity state because of the violence, output in Upper Nile state has been unaffected so far and is pumping 160,000 to 200,000 barrels a day, South Sudanese Foreign Minister Barnaba Marial Benjamin said. The country’s low-sulfur crude is prized by Japanese buyers as a cleaner-burning fuel for power generation. The country has the capacity to produce as much as 350,000 to 400,000 barrels per day, Benjamin said. China National Petroleum Corp., India’s Oil & Natural Gas Corp. and Petroliam Nasional Bhd., the main producers of South Sudan’s oil, evacuated employees from the country because of the fighting. (www.bloomberg.com)

February 19, 2014. Natural gas prices in Europe are poised to drop more than 20 percent in the first quarter amid the mildest weather since 2008, as snow storms push U.S. costs to a four-year high. Gas demand in the U.K., the region’s biggest market, is at its lowest in 12 years, grid data show. The fuel slid 15 percent since Dec. 31 and may fall another 6 percent by the end of March, according to Inspired Energy Plc. Power demand in France slumped the most in 11 months in January, sending March prices to record lows, broker data show. (www.bloomberg.com)

POWER

February 24, 2014. A Florida wholesale power company will build a $450 million natural gas-fired power-generating facility alongside Interstate 85 in Kings Mountain that should begin making electricity by 2018, if all goes as planned. The 480 MW plant will employ about 350 during construction and about 30 once production is underway, NTE Energy said. (www.bizjournals.com)

February 21, 2014. At a time when the country is facing severe power crisis, country´s one of the largest hydel projects, Marsyangdi Hydro Power Project based at Aabukhaireni-6 in Tanahu has reduced the power generation. The project has cut the power production down to 42 MW from 69 MW, citing a low flow of water in the river. According to Marsyangdi Hydro Power Centre Tripureshwor Purbe, power production from the project went down as water flow in the river receded. Presently, only two units out of three are operational rotation-wise. However, power generation is as usual during the peak hours. Electricity produced from the project is linked to national grid through substations at Balaju and Bharatpur. (www.myrepublica.com)

February 21, 2014. Samsung C&T has been awarded an engineering, procurement and construction (EPC) contract to build two new power plants in Algeria. Awarded by Sonelgaz Electricity Production Company (SPE), the $1.37 bn contract covers construction of two power facilities in Mostaganem and Nama. The Mostaganem station is expected to have electricity generating capacity of 1,450 MW, while the Nama facility will have 1,163 MW capacity upon its completion. The Algerian government plans to build six new combined-cycle power plants (CCPPs) accross the country by 2017 to address growing demand of electricity. Samsung C&T has to date completed a total of 18 power plant projects, and is currently working on 12 projects worldwide, including Saudi Arabia, UAE, Singapore and Canada. (fossilfuel.energy-business-review.com)

February 20, 2014. The leaders of Kenya, Rwanda and Uganda seek to develop a joint power generation project to increase power supply in the region, according to a final document from their meeting. The regional leaders also agreed to develop a common mechanism of acquiring way-leaves for not only power generation but to cover other utilities within the integration projects. (allafrica.com)

February 19, 2014. Iran has synchronized a 2.5mWh wind turbine with its national power grid. The wind turbine is located in the northern Qazvin province. According to energy ministry it is the country's first wind turbine with the capacity to generate over one megawatt hours of electricity. Deputy Energy Minister Houshang Falahatian said that the production capacity of Iran's power plants does not meet domestic demands. The deputy energy minister made the remarks at the inauguration ceremony of the country's first small-scale power plant in Western province of Zanjan. (www.utilities-me.com)

February 24, 2014. The Illinois Commerce Commission (ICC) has granted siting approval of final routes and substations to Ameren Transmission Company of Illinois (ATXI) for the 400m-long Illinois Rivers electric transmission project. The estimated $1.1 bn project is expected to facilitate the delivery of low-cost power and improve the reliability and efficiency of the electric power grid. Using steel poles with a single shaft, the 345,000V transmission line will run from Palmyra, crossing the Mississippi River at Quincy, and will then run east past Meredosia, Pawnee, Pana, Mt. Zion and Kansas, ending at Sugar Creek, with additional lines running from Meredosia to Ipava and between the Sidney and Rising substations near Champaign. Substation construction is already underway, while line construction is expected to begin in late 2014. (utilitiesnetwork.energy-business-review.com)

February 19, 2014. Myanmar Electric Power Enterprise and Maxpower (Thaketa), a subsidiary of Navigat Group, have signed a power purchase agreement (PPA) for a 50 MW gas-fired power plant being built in Myanmar. To be located in the Thaketa district of Yangon, the plant will feature 16 General Electric (GE) Jenbacher gas engines. Maxpower has invested $35 mn in the plant, which is now fully functional. The latest move will help strengthen the business relationship of Maxpower and the Government of Myanmar for potential power project development in the country. (fossilfuel.energy-business-review.com)

February 19, 2014. Swiss power and automation technology group ABB has secured a contract, worth about $20 mn, from Aarsleff – Seth JV to provide engineered equipment packages for two new substations in Mozambique. Electricidade de Mozambique owns and operates the substations, which will extend the transmission network in Mozambique. Under the deal, ABB will rehabilitate and extend nine existing transmission substations that will assist to reinforce the grid. (utilitiesnetwork.energy-business-review.com)

February 24, 2014. United Overseas Bank (UOB) signed a financing agreement with Singapore company Asiatech Energy to build a combined-cycle gas-fired power plant in Mon state in Myanmar. The project is worth US$170 million, but UOB did not disclose the loan amount to Asiatech Energy, which was commissioned to build the power plant in Mawlamyaing township by Myanmar Lighting IPP Co. Ltd. (www.businesstimes.com.sg)

February 21, 2014. The Permanent Secretary in the Federal Ministry of Power, Godknows Igali has said that the target for power generation peaked at 40,000 MW by year 2020 is realizable with more capacities to be sourced from the Mambilla and Zungeru large hydros as well as off - grid power from solar, wind and more importantly coal to power through the abundant coal resources in Nigeria. Igali said that the basic tenet in the mandate of his Ministry is to provide policy frameworks towards the realization of electricity for domestic and industrial uses by Nigerians. (allafrica.com)

February 20, 2014. Tokyo Electric Power Co. (Tepco), operator of the crisis-ridden Fukushima Dai-Ichi nuclear power plant, said it found a new leak near the tanks holding contaminated water at the disaster site. The utility, which serves 29 million customers in the Tokyo metropolitan area, is collecting soil where the leak occurred and doesn’t believe any water reached the ocean, the company said. About 100 metric tons (26,400 gallons) of water may have escaped a concrete barrier, the company said. The finding is a reminder of the task still facing Tokyo Electric as the utility, known as Tepco, battles to manage the plant almost three years since the earthquake and tsunami. Beta radiation readings of 230 million becquerels per liter were taken in a sample collected from a gutter on top of the leaked tank at the Fukushima Dai-Ichi plant, according to the Tokyo-based utility. Japan’s safety limit for radioactive materials in drinking water is 10 becquerels per liter, according to the health ministry. Japan’s nuclear regulator said that it has asked Tepco to ensure no more leaks from the same type of water storage tanks occur. The leak highlights difficulties for the regulator as it seeks to force Tepco to limit radiation at the site without slowing down its decommissioning. (www.bloomberg.com)

February 19, 2014. Electricite de France SA (EDF), Europe’s biggest power producer, contracted Doosan Babcock to service and help extend the life of seven of its eight U.K. nuclear plants. The agreement is valued at about 70 million pounds ($117 million) a year, Cameron Gilmour, nuclear service director at Doosan Babcock, said. While there’s no fixed duration, the contract may last as long as 20 years, he said. That would value the deal at as much as 1.4 billion pounds. (www.bloomberg.com)

February 25, 2014. In a bid to boost renewable energy generation, oil giants like Oil and Natural Gas Corp (ONGC) and Indian Oil Corp (IOC) will form new companies to set up large sized solar and wind energy projects in India and abroad. ONGC along with Oil India Ltd (OIL), GAIL, Engineers India Ltd (EIL), Solar Energy Corp of India (SECI) and Indian Renewable Energy Development Agency (IREDA) will set up a special purpose vehicle to undertake big electricity grid-connected projects. A second SPV led by IOC will look at setting up off-grid projects using advanced technologies. This SPV will include Bharat Petroleum Corp (BPCL), Hindustan Petroleum Corp Ltd (HPCL) besides SECI and IREDA. A memorandum of understanding for setting up of the SPVs was signed by Oil Secretary Vivek Rae and New and Renewable Energy Secretary Satish Agnihotri. Rae said the collaboration is aimed at leveraging the financial and managerial muscle of oil companies to scale up renewable energy projects as well as manage complexities of small projects. New and Renewable Energy Minister Farooq Abdullah said vast potential for setting up large social projects exist in Laddakh, Rajasthan and Gujarat. Similarly, offshore wind farms are envisaged in 15 nautical miles. Agnihotri said the government is looking at ultra mega projects of up to 500 MW at a cost of ` 6-7 crore per MW. (economictimes.indiatimes.com)

February 25, 2014. Tata Power Renewable Energy Limited (TPREL), a 100 per cent subsidiary of Tata Power, one of India's largest integrated power companies, has completed the acquisition of AES Saurashtra Windfarms Pvt Ltd (ASW), the erstwhile 100 per cent subsidiary of AES Corporation. ASW owns and operates a 39.2 MW wind farm near Dwarka in Jamnagar district of Gujarat. The project which is fully operational since January 2012 has executed a power purchase agreement with Gujarat Urja Vikas Nigam Ltd (GUVNL) for sale of the electricity at a tariff of ` 3.56/kWh for the duration of the project. The project is registered with United Nation Framework Convention on Climate Change (UNFCCC) as a Clean Development Mechanism (CDM) project and is eligible to receive Certified Emission Reductions (CERs). The project is also registered under the Generation Based Incentive scheme of Ministry of New and Renewable Energy (MNRE). With this acquisition, Tata Power's total generation capacity will increase to 8560 MW and its Wind Operational Generation capacity to 437 MW with wind turbines located across five states; Maharashtra, Rajasthan, Gujarat, Tamil Nadu and Karnataka, which are the leading states in promoting wind power generation in India. Tata Power currently has four of its renewable projects registered under the CDM program by UNFCCC. (www.business-standard.com)

February 24, 2014. The Delhi Metro Rail Corporation (DMRC) is all set to become the first ever Metro system in the country to install 'Roof Top Solar Power Plants' at its Metro stations. The first ever such plant with a production capacity of 500 kWp will be installed at the Dwarka Sector 21 Metro station. A Power Purchase Agreement (PPA) regarding the installation of the plant was signed between DMRC and the developer, a multinational firm engaged in the installation and production of solar power worldwide, in the presence of DMRC's Managing Director, Sh. Mangu Singh and other senior officials of DMRC. This is the largest roof top plant with such capacity in Delhi NCR region under RESCO model. Under this model DMRC will pay for the units generated by the plant and the capital investment shall be provided by the developer. The plant is expected to start production within a period of six months. The power produced from this plant will be used to cater to the power requirements of DMRC at this station. After the installation of this roof top plant, DMRC will also explore the possibility of installing more such plants at its stations, depots, parking lots as well as residential complexes. Efforts are also being made to integrate such solar plants with the station structures of Phase 3. (economictimes.indiatimes.com)

February 24, 2014. India’s solar power cost fell to a new low, edging closer to coal, as declining panel prices and increased competition drew offers to build plants from groups backed by BlackRock Inc. and Electricite de France SA. India, which uses competitive bidding to select companies offering to generate clean energy at the lowest cost, awarded 750 MW of permits, half of that eligible to use imported equipment. The government also offered grants to offset project costs for the first time, helping attract bids for triple the capacity auctioned. India plans a sixfold increase in solar capacity drawing $11.7 billion of investment by 2017 to reduce blackouts as plunging panel prices help photovoltaic projects compete with coal- and gas-fired plants. The Indian unit of St. Peters, Missouri-based SunEdison Inc., which counts BlackRock among its biggest investors, and World Bank-backed Azure Power India Pvt. won the most capacity at 100 MW each. (www.bloomberg.com)

February 21, 2014. The Madhya Pradesh government said that the 130 MW solar power project of Welspun Solar Madhya Pradesh Pvt Ltd, a subsidiary of Welspun Group, was ready for commissioning in state's Neemuch district. The 130 MW project, has been set up with an investment of ` 1,100 crore. It is expected to start supplying power to the grid and the Madhya Pradesh power management company, soon. The company had clinched the project through bidding process at ` 8.05 per unit. The company bagged 130 MW of the total 299 MW power auctioned by the state government. The state invited investment in solar power to attain grid parity. Grid parity means solar power tariff equalling that of thermal power. The state has received investment from 54 different projects for a total of 254 MW solar power and by March, the capacity would reach 354 MW. (www.business-standard.com)

February 21, 2014. India's biggest wind utility firm, CLP Wind Farms, plans to sell a minority stake to global private equity investors to raise up to ` 1,200 crore to fund expansion. The company, a unit of Hong Kong-listed power generator CLP Holdings, has appointed Standard Chartered Bank to scout for investors. This is third attempt by the company to raise capital in two years. The earlier attempts were not successful as the company did not agree to the valuation offered by PE funds. CLP Wind Farms owns more than 3,000 MW of power projects in the country. It generates 1,000 MW of wind power. (economictimes.indiatimes.com)

February 20, 2014. India and Argentina have agreed to enhance cooperation in the field of renewable energy. In a meeting with a delegation led by Dr. Antonio Bonfatti, Governor of Santa Fe. Rosario Province, Argentina, Dr. Farooq Abdullah, Union Minister for New and Renewable Energy conveyed the willingness of the Government of India to enhance bilateral ties and economic cooperation with Argentina especially in the field of renewable energy. Collaboration in sectors of bio-diesel and possibilities of future commerce and business in bio-fuel were also discussed. Dr. Antonio Bonfatti agreed that the two countries should use their full potential to enhance cooperation and bilateral ties. Dr. Abdullah informed the visiting dignitaries about the National Policy on Bio-fuels which was announced in December, 2009 and endeavors to bring about development and utilization of indigenous feedstock for production of biofuels. He highlighted the Indian approach to biofuels which is based solely on non-food feedstock to be raised on degraded or wastelands that are not suited to agriculture, or through use of wastes and residues, thus avoiding a possible conflict of fuel and food security. Dr. Abdullah also informed the visiting delegation that the Ethanol Blended Petrol (EBP) Programme is currently being implemented by the Oil Marketing Companies (OMCs) with the overall aim of achieving on EBP of 5 percent. On this occasion, Dr. Abdullah also spoke about the energy situation in India and the rapid growth of the renewable energy sector in India. He spoke of India's plans to add over 30 GW of renewable energy to its energy mix in the next five years. He dwelt on the success of the wind programme as well as the significant cost reductions in solar energy through the Jawahar Lal Nehru National Solar Mission. He also highlighted India's conducive and investor friendly policy framework for promoting renewable energy in a big way. He offered all possible assistance from India to the development of the renewable energy capacity of Argentinian officials and regulators. (www.business-standard.com)

February 25, 2014. China closed in on the U.S. at the top of a renewable-energy ranking by consultants EY after installing record solar-power capacity last year. China scored 73.1 out of 100 on the Renewable Energy Country Attractiveness Index in the fourth quarter, up from 71.6 in the third, while the U.S. slipped to 74.4 from 74.7, EY said. The two were followed in the list of 40 countries by Germany, Japan and the U.K. China, the largest energy user, is speeding the development of renewables to curb air pollution. The nation has some of the toughest efficiency standards for buildings and transport, and its support for photovoltaic projects has caused solar-panel costs to tumble. In the U.S., shale investment has reduced the incentive to add clean power as higher gas output cuts prices. China installed a record 12 GW of photovoltaic panels last year, more than the total amount of solar power in operation in the U.S. It’s targeting a further 14 GW this year. The country also installed about 14 GW of wind power in 2013 and is targeting 18 GW this year. (www.bloomberg.com)

February 25, 2014. California, the second-most polluting state in the U.S., sold 19.5 million carbon allowances at auction for $11.48 each, in line with analysts’ expectations. Units of BP Plc, Chevron Corp. and Calpine Corp. were among the companies that qualified to buy permits in the Feb. 19 auction, a report posted on the state Air Resources Board’s website showed. The agency doesn’t disclose the names of winning bidders. The state received 1.27 offers for every permit put up for sale. (www.bloomberg.com)

February 25, 2014. Canadian Solar Inc., the best-performing solar manufacturer last year, agreed to supply 48 MW of modules for power plants in Japan and the U.S. Canadian Solar is providing 18 MW of panels for a project that Hitachi Ltd. is building in Northeast Japan for Eurus Energy Holdings Corp. The power plant is expected to be operational in March 2015 and Tohoku Electric Power Co. has agreed to buy the output under a 20-year contract. The solar company, based in Guelph, Ontario, is also supplying 30 MW of panels to Strata Solar LLC for five projects in North Carolina. (www.bloomberg.com)

February 25, 2014. In a breakthrough, scientists have developed a new technique to produce cheap and environmentally friendly second-generation biofuel from dead plant tissue. The process as used needs expensive enzymes, and large companies dominate this market, researchers said. Now Danish and Iraqi researchers have developed a new technique that avoids the expensive enzymes. Researchers said the production of second generation biofuels thus becomes cheaper, probably attracting many more producers and competition, and this may finally bring the price down. (www.financialexpress.com)

February 24, 2014. Mitsubishi UFJ Financial Group Inc., the largest lender in Japan, expects to fund clean energy projects in 2014 at the same level as last year with solar the main destination for investment in Japan. Mitsubishi UFJ was lead arranger of 37 deals totaling about $2.5 billion last year, according to the Tokyo-based bank. Twenty of the deals were for projects in North America, nine in Japan, five in Australia, and three in the U.K. (www.bloomberg.com)

February 24, 2014. Kandi Technologies Group Inc., a Chinese electric carmaker that rents out vehicles to the public, said the service is profitable and plans to expand it to cities including Beijing and Shanghai. Kandi, together with joint venture partner Geely Automobile Holdings Ltd., provides electric vehicles for short-term hire using automated multilevel garages in Hangzhou. Rental rates start from 20 yuan ($3.3) an hour and covers the first 25 kilometers (16 miles), compared with the starting rate of 11 yuan for taxis. The world’s second-largest economy is lagging behind its target to have 5 million alternative energy-powered vehicles by 2020 because of a lack of charging stations and high costs. (www.bloomberg.com)

February 24, 2014. Israel’s ministerial committee for renewable energy approved the transfer of 290 MW renewable energy quotas to the solar photovoltaic sector. Specifically, quotas for 70 MW of large wind power parks, 20 MW of small wind power installations (up to 50 kW each) and 200 MW of solar thermal power plants were transferred to the solar PV industry. The committee, which is an inter-ministerial governmental body, argues this decision will help the country to achieve its national target for 10 percent electricity generation from renewable types of energy by 2020, and will lead to a savings of more than NIS 2 billion (US$564.2 million) over the next 20 years. Environmental Protection Minister Amir Peretz is also pushing to transfer 60 MW of its biogas quota to solar PV, aiming for NIS 27 million (US$7.6 million) in cost savings. Following the committee’s decision, Energy, Water and National Infrastructures Minister Silvan Shalom verified the Israeli Government’s commitment to the 2020 electricity target, however added the level of electricity tariffs should remain within limits that do not threaten the economy and the cost of life. (www.renewableenergyworld.com)

February 20, 2014. Iceland and Japan, two nations rich with underground sources of renewable energy, can tackle climate change together by promoting the use of geothermal power, Iceland’s environment minister Sigurdur Ingi Johannsson said. By combining expertise, the two countries would be able to provide help to other nations such as Djibouti and Kenya in East Africa and other developing countries, he said. (www.bloomberg.com)

February 20, 2014. Birds, sharks and unexploded bombs from World War II are being blamed for holding up offshore wind farms, raising doubts about the costs of the technology. Three utilities scrapped an expansion of the world’s biggest offshore wind farm in the Thames estuary, east of London. That capped three months when each of the six largest U.K. utilities retreated from marine energy projects. While developer EON SE highlighted concerns about disrupting the wintering grounds of the red-throated diver, the broader threat to the industry is its failure to bring down costs quickly enough in nations that are increasingly concerned about the price of electricity. The U.K. market is crucial to the industry because it’s the biggest source of new projects and accounts for more than half the global installed capacity. Prime Minister David Cameron’s government has set incentives for offshore wind through 2019, hoping to stimulate clean-energy jobs. (www.bloomberg.com)

February 19, 2014. Iberdrola SA, Spain’s largest utility, will shift investment toward Britain, Latin America and the U.S. as growth at home is stymied by a stagnant economy and rising renewable-power levies. The Madrid-based company plans to invest 9.6 billion euros ($13 billion) from now until 2016, 41 percent of which is destined for the U.K., followed by Latin America and the U.S. Spending in Spain, which is being cut to 15 percent of the total from 17 percent, will mainly be for maintenance. Iberdrola is investing in regulated businesses including distribution networks, which will account for 57 percent of spending through 2016, and renewables. (www.bloomberg.com)

February 19, 2014. Ferrostaal Industrial Projects GmbH, a German industrial services company, will take a major stake in a 52 MW wind farm project planned for a remote city in Mongolia’s Gobi Desert. The $120 million Sainshand Wind Farm Project is scheduled to go online in late 2015 and will produce 190 GW hours of electricity a year, the company said. (www.bloomberg.com)

February 19, 2014. China spent more on smart grids than the U.S. for the first time in 2013, with the $4.3 billion it invested accounting for almost a third of the world’s total. Global spending rose almost 5 percent to $14.9 billion, according to data. North American investment declined as much as 33 percent to $3.6 billion. Smart grids allow power generators and users to monitor usage, helping utilities adjust supply to demand and reducing costs by saving energy in transmission. China has installed almost 250 million smart meters, which enable customers to provide immediate feedback to utilities that are able to use the data to set pricing and smooth fluctuations in consumption. (www.bloomberg.com)

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