Energy News Monitor | Volume XI; Issue 37

[Pressure on Property Rights: The Case of Coal in India]

                             “The value of output from fuel minerals of which coal constitutes the bulk in India has increased by over ten times in the last three decades and consequently the pressure to alter or reduce Governments control of property rights over coal has been growing. What the private sector wants is a bigger share of increase in value of these resources through a larger role in exploiting coal resources…”

Energy News

[GOOD]

Aggressive bidding for coal blocks is a good sign only it is not a sign of desperate self-destructive bidding!                                   

                                                                                                 [BAD]

Delhi government should stay out of the business of bidding for coal blocks unless it wants to go out of business!  

[UGLY]

Auction of coal blocks may not lower power tariff but competition and efficiency will! 

NEWS BRIEF

[NATIONAL: OIL & GAS]

February 19, 2015. Oil and Natural Gas Corp (ONGC) is planning to develop DWN-98/2 offshore block in Krishna-Godavari Basin on fast-track which start production by 2018-19. ONGC announced that projects worth ` 22,500 crore had been approved in the last six months including DWN 98/2 block in KG Basin. Once the project is through, there would be huge volume of financial output from the offshore block for the ONGC. The State would be the first beneficiary once production commenced. The production was badly affected with Nagaram GAIL pipeline blast. Production which dropped from three million cubic meters per day (mcmpd) to 0.02 mcmpd now increased to 1.7 mcmpd. It would take another four months to reach the actual target after GAIL restores all pipelines in Nagaram and other areas in East Godavari district before June. (www.thehindu.com)

February 18, 2015. Oil and Natural Gas Corp (ONGC) said it has entered into a technological partnership with a private firm which will ease it in shale gas exploration. With this partnership, ONGC will provide assistance to Super Wave Technology Pvt. Ltd (the partner) for developing Shock Wave Assisted Fracking Technology (SWAFT), an alternate to the conventional hydraulic fracturing which if proven effective as a substitute to hydraulic fracturing, in particular for shale gas exploitation, will be a game changer for the oil & gas industry, the state-owned firm said. According to the company, hydraulic fracturing requires very large quantity of fresh water and huge quantity of energy for pumping the same at very high pressures. Post hydraulic fracturing, the well produces substantial quantity of effluent water which needs to be disposed. This issue can be addressed by adopting SWAFT. The company said the collaboration will provide impetus for development and field implementation of Shock Waves technology for oil and gas fields. (www.newkerala.com)

February 24, 2015. The Petroleum and Natural Gas Regulatory Board (PNGRB) has invited bids for issuing licences for retailing CNG and piped cooking gas in 20 cities like Haridwar and Aligarh. PNGRB said that April 23 is the last date of bidding for development of city gas distribution networks in East Godavari, West Godavari, Belgaum, Ahmadnagar, Krishna, Muzaffarnagar, Badaun, Aligarh, Bulandshahr, Banaskantha, Tumkur, Latur, Dhar, Dahod, Shivpuri Haridwar, Dharwad, Bidar, Osmanabd and Udham Singh Nagar. Bidders have been asked to quote the tariff they will charge for the pipeline network to be laid in the city and the compression charge for dispensing CNG (compressed natural gas) over the 25 years. They have also been asked to quote the inch-kilometre of steel pipelines they will lay during first five years and the number of domestic consumers proposed to be connected by piped natural gas, according to the regulator. This will be the fifth bid round even though PNGRB is yet to award licenses of the previous rounds.

Fourteen cities offered in the fourth round announced in October 2013 are yet to be awarded. These were Eranakulam in Kerala; Rangareddy/ Medak, Nalgonda and Khammam in Andhra Pradesh; Bengaluru rural and urban districts in Karnataka; Raigarh, Pune and Thane in Maharashtra; Daman; Dadar & Nagar Haveli; Shahjahanpur in Uttar Pradesh; Guna in Madhya Pradesh; Panipat in Haryana and Amritsar in Punjab.              

To accelerate deployment of the CGD network in the country, PNGRB had invited bids in 2009 for 13 cities in first two rounds. GAIL Gas Ltd walked away with four of the six cities offered in round one. It won Sonepat in Haryana, Dewas in Madhya Pradesh, Meerut in Uttar Pradesh and Kota in Rajasthan while Bhagyanagar Gas Ltd got Kakinada in Andhra Pradesh and DSM Infratech Mathura in Uttar Pradesh. The third round of bidding was opened in July 2010 and concluded in February 2011 (after extension), but final awards of most cities are yet to be made because of certain litigation involving PNGRB and a few other parties. City-based Jay Madhok Energy won rights to Jalandhar city, according to PNGRB. (economictimes.indiatimes.com)

February 19, 2015. The KG Basin Isolated Wells Consumers Association (KGBICA), an association of gas-based small and medium industries located in the interior rural areas of Andhra Pradesh, is opposing Oil and Natural Gas Corp (ONGC)’s proposal to re-auction the isolated gas wells instead of extending the current gas supply agreements (GSAs) with the allottee industries. The GSAs executed by ONGC with the industries prior to 2000 were valid initially for a period of five to six years, which on expiry were extended for additional blocks of five years. Such GSAs are now due for expiry during 2015 and 2016. It is understood that ONGC is proposing to re-auction these wells instead of extending the validity of the existing GSAs as was done on earlier occasions, said Sarath Joseph Gummadi, coordinator of KGBICA. He alleged ONGC had abruptly stopped gas supplies from Vygreswaram isolated fields (in East Godavari district) to one of their members, Steel Exchange from January this year without any notice. The corporation was supplying around 2,000 standard cubic meters per day (SCMD) as against the allocation of 10,000 SCMD to the company. Gummadi said ONGC had informed that they wanted to re-tender the gas from this well since they got a quote of $11 in one of the tenders last year elsewhere in the state. For another industry, Vijai Bhavani Power, he said the GSA for 3,000 SCMD from Kesanapally fields was expiring on March 31, 2015, and ONGC was going for re-tendering. According to Gummadi, most of these industries are also categorised as small consumers by the ministry of petroleum and natural gas (MoPNG), with gas allocations of up to 50,000 SCMD. The total gas allocation of these industries is 330,000 SCMD. (www.business-standard.com)

February 19, 2015. GAIL India Ltd has not found any bidder for its $ 7 billion tender to hire newly-built LNG ships to ferry gas from the US. GAIL's ` 42,370 crore tender to hire nine newly-built liquefied natural gas (LNG) tankers drew a blank due to the government's condition of building a third of the ships in India. GAIL had in August last year floated a global tender to charter nine newly-built ships for transportation of natural gas in its liquid form at sub-zero temperature (LNG) from the US. The tender required bidders to build one-third of the ships in India, a condition that found no takers. It first postponed the last date of bidding from October 30 to December 4, then to January 6 and February 17. GAIL was originally not in favour of the condition but succumbed to Oil Ministry's dictate once it was threatened with a Presidential directive. The company may have to re-float the tender without the 'Make in India' condition. GAIL had on April 4 last year approved hiring of up to 11 newly-built LNG ships. The Ministry saw the chunky contract to be the perfect opportunity for India to exercise buyer's clout and wanted a part of the contract be set aside for Indian shippers to kick-start domestic manufacturing by compelling global majors to transfer LNG shipbuilding technology to India. Oil Minister Dharmendra Pradhan and External Affairs Minister Sushma Swaraj had tried to persuade South Korea, the world's largest LNG tanker manufacturer, to rescue the tender. Four Korean shipyards qualify for GAIL's tender requirements -- Samsung Heavy Industries, Daewoo Ship Building and Marine Engineering, Hyundai Heavy Industries and STX Offshore and Shipbuilding -- but none of them showed any interest in the tender. GAIL will start receiving LNG from the US from December 2017 and it needs the tankers before that. It has already lost one year in the tendering process. (economictimes.indiatimes.com)

February 24, 2015. Prices of petrol and diesel will increase in Jharkhand from midnight after the state government decided to raise VAT and impose one rupee cess per litre on the fuel to mop up additional revenue. As per the Cabinet decision, VAT on petrol has increased from 20 percent to 22 percent and on diesel from 18 percent to 22 percent, besides the cess, and would be effective from midnight tonight. Presently, the price of petrol per litre is ` 56.69 and of diesel is ` 48.63 per litre. (economictimes.indiatimes.com)

February 22, 2015. The proposed gas price pooling policy of the government is expected to increase the Gross Domestic Product (GDP) by 0.50-0.88 percent, the study conducted jointly by National Council of Applied Economic Research (NCAER) and GMR Energy said. The gas price pooling policy would lead to an increase inGDP of 0.50 percent or Rs 69,431 crore with a plant load factor of 30 percent, 0.7 percent (or ` 96,107 crore) with a PLF of 40 percent, and 0.88 percent (or ` 1.23 lakh crore) with a PLF of 50 percent, the study said. The proposed gas price pooling policy would pool existing limited supply of domestic gas with imported regasified LNG to help operationalise about 16,100 MW of stranded, gas-based, power plants to start operating from their current zero percent of plant load factor (PLF) to about 30-40 percent. Also, it will help increase employment in 2015-16 by creating about 13 lakh new jobs with 30 percent PLF; 18 lakh with 40 percent PLF and 23 lakh with 61 percent PLF, the study said. However, it pointed out that price of pooled natural gas would be higher than domestic price which will hike power production cost. The revenue shortfall is proposed to be partially borne by government as subsidies and tax concessions, and partially borne by inter-linked sectors taking cuts in their revenues. NCAER said the proposed gas price pooling policy will have positive growth multiplier effects on economy. (www.business-standard.com)

February 19, 2015. India will soon revive talks with Oman for an undersea pipeline as the government looks to supplement its sources of energy. The decision was taken during external affairs minister Sushma Swaraj's meeting with her Oman counterpart Yousuf bin Alawi bin Abdullah. During Swaraj's visit, India and Oman reviewed their strategic ties and decided to expand defence and maritime cooperation in maintaining stability and security in the Indian Ocean region. The two sides explored opportunities on how Oman can plug into the expanding opportunities in India, including as a natural gas supplier. Swaraj briefed the Omani leadership about the economic reforms and growth agenda of the new Indian government and welcomed increased investments from this oil-rich nation. (timesofindia.indiatimes.com)

February 18, 2015. The oil ministry plans to give local companies a juicy share of the ` 6-7 lakh crore investment planned in the next five years by helping local equipment makers compete successfully against foreign vendors, and setting up manufacturing clusters with attractive funding with the help of the ` 10,000-crore collected as oil industry development cess every year. The ministry hopes to make significant contribution to the NDA government's Make-in-India programme in which Prime Minister Narendra Modi wants to make the country a manufacturing hub and create jobs. The oil ministry, as part of its initiatives for the programme, plans targeted fiscal measures such as long-term funding and interest subvention for manufacturing clusters. The ministry is likely to modify procurement norms for public sector entities by aggregating their requirements and has set a target of 50% indigenisation for investments in the upstream sector over the next three years. The ministry has said in the medium term, it would aim to set up dedicated manufacturing zones and clusters focused on oilfield services such as building ships, offshore platforms and rigs. (economictimes.indiatimes.com)

February 18, 2015. The new government has pursued pro-growth initiatives and we expect the 2015 budget to continue in this vein to further boost the economy and restore investor confidence. We await the passage of the GST Bill and its implementation to include all petroleum products viz. Crude Oil, Motor Spirit, Aviation Turbine Fuel, High Speed Diesel, Natural Gas, LNG (including LNG regasification Services) which will go a long way in streamlining the economy and introduce efficiencies which will contribute to GDP growth. As in the case of petrol, the inclusion of Excise duty on branded diesel would help reduce the cascading effect on the economy and reduce the burden on the consumers. The proliferation of Natural Gas (including LNG) is limited due to the current taxes structure that adds costs and tests the affordability limits of the customer. Despite being a primary fuel source like coal and crude oil, Gas does not get the benefit of customs duty exemption (as does crude oil) or status of a "declared good" as enjoyed by crude oil and coal, consequently attracting VAT along the supply chain. A selective exemption of customs duty applicable only to the power sector disables customers from others sectors to leverage the benefits of Gas as their fuel source. To ensure parity, this anomaly needs correction by waiving customs duty on LNG for all users and for gas to be accorded the status of a "declared good". By doing so, this will expand the scope of Gas which is the cleanest burning fossil fuel and also enable reduction in the Government's subsidy bill (e.g. replacing household LNG). We would welcome the Government to also further augment the initiative of supporting 15,000 km of gas pipelines announced in the previous budget through encouragement of additional pipelines including city gas networks that should provide larger number of potential users' access to gas. Customers would not only benefit from financially but a move towards this will also be environmentally beneficial. In addition, development of petroleum carrying, storage and handling infrastructure alongside encouragement to private investment in the retail fuel business would help improve utilisation and efficiencies while reducing waste that will benefit the consumers. Continued focus of the government's reform agenda would help bring in more capital, employment and opportunities to India that would greatly benefit all sections of society. (economictimes.indiatimes.com)

February 18, 2015. Slamming the new natural gas formula as making "no sense", world renowned energy expert Fereidun Fesharaki has said only guaranteed market prices along with stable policy regime would bring in investments from global majors. The $ 3-4 per million British thermal unit (mmBtu) price in United States was reflective of the surplus gas scenario in US and rates will rise the moment exports are allowed, he said. Similarly, Russia flares gas equivalent to India's annual production and rates prevalent there are not reflective of market scenario. He said US gas in form of LNG will be $ 7 higher than the current Henry Hub price of under $ 3 per mmBtu on account of liquefication, transport, pipeline and regassification cost. The rate will compare to the $ 5.61 per mmBtu price approved by the government for period upto March end. Similarly, bringing gas through a transnational pipeline like Turkmenistan-Afghanistan-Pakistan-India (TAPI) will cost no less than $ 10-11 at the Indian border, he said. The new price was 33 percent higher than $ 4.2 per mmBtu old rate but lower than $ 8.4 per mmBtu approved by the previous UPA government. The new price is also lower than $ 5.71 rate charged for western offshore gas field and $ 8 that Cairn charges for gas from its Rajasthan block. India, he said, has to allow a free float of gas price and put a cap at say $ 10. (economictimes.indiatimes.com)

February 18, 2015. The oil ministry has moved a proposal to pool or average out prices of domestic natural gas and imported LNG used by fertilizer plants to make the cost of fuel uniform and affordable. Fertilizer plants consume about 42.25 million standard cubic meters per day (mmscmd) of gas for manufacture of subsidised urea. Out of this, 26.50 mmscmd comes from domestic fields and the rest 15.75 mmscmd is imported liquefied natural gas (LNG). The $ 4.2 per million British thermal unit price of domestic gas is about one-third of cost of LNG. The cost of gas, which is the most important component for production of urea, varies from plant to plant owing to differential rates at which imported LNG is contracted as well as cost of transportation. The proposal moved for inter-ministerial consultations, before being put up to the Cabinet Committee on Economic Affairs (CCEA), calls for averaging of different rates of domestic and imported gas to ensure supply of fuel to all urea plants at a uniform delivery cost.

Presently, a proposal to pool gas prices for power plants is under consideration of the government. The ministry has proposed to make state- owned gas utility GAIL India Ltd as the pool operator. The Department of Fertilizer will determine the total requirement of natural gas and draw plant-wide requirement, which would then be informed to the pool operator, GAIL. The pool operator will tie-up imports after considering domestic availability and after averaging out price of both, delivery the fuel at uniform rate to all plants. The ministry wants the pooling mechanism to be effective from April 1. (economictimes.indiatimes.com)

 [NATIONAL: POWER]

February 24, 2015. The importance of safety in nuclear power generation was stressed by Vinod J. Katti, Regional Director of Atomic Energy (DAE), during the inaugural function of the Atomic Science Exhibition and the Anuvigyan Week at the Islamiah College in Vaniyambadi. The exhibition and Anuvigyan Week were organised jointly by the Department of Atomic Energy (DAE), Government of India and the college. (www.thehindu.com)

February 23, 2015. Tata Power announced signing an initial agreement with Russia's largest coal producer Siberian Coal Energy Company (SUEK) for tapping opportunities in the energy sector. As part of the agreement, both Tata Power and SUEK will cooperate on identifying and targeting opportunities in the energy sector in Russia and other geographies of common interest in order to develop mutually beneficial transactions. Tata Power generates about 8,621 MW of power of which 7,407 MW is from thermal power generation. According to information on SUEK website, the company delivers coal to more than 30 countries all over the world. (economictimes.indiatimes.com)

February 22, 2015. Lanco Group has approached lenders to reschedule ` 1,000 crore debt of two of its gas-based power plants in Andhra Pradesh till January 2018. The infra major has also sought similar reprieve from lenders for some of its power plants under Reserve Bank of India's 5/25 formula. Lanco Kondapalli Power Limited (LKPL) operates three gas-based power plants in Andhra Pradesh. Two plants, Unit-II and III, are not able to operate due to lack of gas supplies from KG-Basin. Unit-III is yet to declare Commercial Operation Date. The Group is also in the process of approaching lenders to rescheduling of loans of some of its power plants under the Reserve Bank's 5/25 Rule. This rule enables a bank to extend loans to an infra developer for 25 years with an option to rewrite or reset the terms of the loan or transfer it to another bank or financial institution after five years. (economictimes.indiatimes.com)

February 21, 2015. Prime minister, Narendra Modi pitched for increasing power generation from hydro source in Arunachal Pradesh. Several projects in Arunachal Pradesh are facing protests and have failed to take off. Centre is investing close to ` 7500 crore infrastructure projects in frontier state. Already the Arunachal Pradesh which is often referred as "power house of India" is in the process of developing 41,400.5 MW capacities of power and its hydro power potential is estimated to be around 60,000 MW. NHPC's 2000 MW Lower Subansiri Hydroelectric Power Project (LSHPP) along the Assam-Arunachal Pradesh has been stalled for the last three years. Modi said Arunachal Pradesh could provide electricity to the entire country. (economictimes.indiatimes.com)

February 19, 2015. The Arvind Kejriwal government has come up with an ambitious plan to increase Delhi's electricity generation. It is exploring the possibility of setting up a coal-based thermal power station to meet the capital's rising power demand. The government has decided to bid for coal blocks to set up the new power plant and will take up the matter with the Centre soon. A meeting with the union power minister will be sought. Delhi government officials said they were aiming for the capital to generate at least 4,000 MW for its own consumption. Currently, Delhi produces less than 2,000 MW. In its manifesto, AAP had promised to make Delhi self-reliant in power generation. The city witnesses an annual growth of 10%-15% in peak power demand and produces less than 20% of its own power. For the rest, Delhi is dependent on central sector generation. Delhi currently has four power stations that are specifically meant for the city - Rajghat, Pragati I, Pragati II in Bawana, Gas Turbine and NTPC's Badarpur thermal station. A 108-MW power plant in Rithala has also been set up by Tata Power Delhi but it has not been operating for the last two years due to gas shortage. Out of these, Rajghat and Badarpur, are coal-based plants. The Bawana power plant was set up at a cost of ` 4,500 crore but generates only up to 350 MW due to non-availability of gas. The city gets 3,500 MW of power from various power plants, including of NTPC, under the central quota. As per projection by Central Electricity Authority, the power demand in Delhi will jump to 8,700 MW by 2017. The Delhi government, along with Haryana, was given a coal block in Madhya Pradesh in 2006. But it could not go ahead with exploration of that block - Mara II Mahan in Singrauli district - due to regulatory hurdles. The block was primarily allocated to Delhi and Haryana for supply of coal to the Jhajjar power plant in Haryana. (timesofindia.indiatimes.com)

February 18, 2015. Private power generation companies were now leading in generating additional capacity in India, but were being hampered by a number of factors, according to an Indian businessman. Venerable Energy Solutions Managing Director Mayank Garg said financial difficulties at the state-owned distribution companies were a serious threat to India's huge power demands. Speaking at the South African Coal Exports Conference, Garg said the deregulation of the sector had led to private companies generating additional capacity, but one of their primary challenges was getting sufficient coal supplies. Although India has vast coal deposits, it imports a substantial amount of its needs, including from South Africa. Garg said the financially-constrained state-owned distribution companies were reluctant to sign long term deals with private power generators who did not have their own coal mines, which in turn reduced the ability of these companies. A lack of finance at the distributors also greatly impacted on their ability to invest in new infrastructure and maintenance, and to buy power from other generators. Other factors were using power as a political instrument, such as the agricultural sector getting free power; as well as lack of control over theft, which was as high as 50 percent in some instances. But it was not all gloom and doom in the Indian power sector, he said. Garg said the new government had introduced a number of initiatives which could assist, including setting new targets for domestic coal production and speeding up administrative processes for adding new capacity. Participants at the conference drew parallels between the power challenges in India and South Africa, where the embattled national distributor Eskom has had to implement large-scale load-shedding countrywide in recent weeks due to a lack of capacity to meet demand. (economictimes.indiatimes.com)

February 20, 2015. Four companies, including Power Grid Corp of India Ltd (PGCIL), have bid for two transmission projects, Gadarwara A and B, worth ` 6,000 crore even as seven other pulled out of the bids after showing interest. The four companies to bid for these projects at the end of the deadline were PGCIL, Essel Infra, Sterlite Grid and Adani Group. The Gadarwara A and B transmission lines would primarily be used to evacuate electricity generated at NTPC's power plant at Gadarwara in Narsinghpur district in Madhya Pradesh. The bid winner will be announced. Some of the other bidders pulled out anticipating aggressive bids by PGCIL, which bid 40-70% lower and bagged two projects last year — Unchahar Transmission and transmission projects under Northern Region Strengthening System for the northern grid. (economictimes.indiatimes.com)

February 18, 2015. Private discoms BSES Rajdhani Power Ltd and BSES Yamuna Power Ltd told the Supreme Court that they were in an "unviable" financial position and their revenue gap could be bridged through a 20-25 percent hike in power tariff. BSES Yamuna Power Pvt Ltd (BYPL) and BSES Rajdhani Pvt Ltd (BRPL), which owe money to various power generating PSUs including NTPC and NHPC, had moved the court seeking various reliefs including a direction that the power supply to them should not be cut by the PSUs for ensuring uninterrupted supply in Delhi. Delhi Electricity Regulatory Commission (DERC), which fixes the power tariff, opposed the plea of the private discoms saying they have "buffered up" the losses. Tata Delhi Power Distribution Limited (TDPDL) is the third private discom which supplies power in Delhi. It also acts under the same so-called draconian regulatory regime and it has paid every penny to the power generating companies. (economictimes.indiatimes.com)

February 24, 2015. World Bank called for more transparency in India's power subsidy regime and suggested re-identification of the target population to improve the balance-sheets of losses-stricken discoms. The global development finance body said the key sector should be allowed to operate in a commercially viable manner by making sure that who are not eligible for subsidy pay for what they consume. World Bank Senior Energy Specialist Mohua Mukherjee parried a question on the viability of the almost-free power promise made to the lower-end consumers in Delhi by the new AAP Government. The World Bank identified the customer-facing distribution companies as the vertical that needs attention. At present, the industrial and commercial users cross-subsidise by paying more for their power usage, which should be avoided to the extent possible, she said. Mukherjee said the sector should be allowed to operate in a commercially viable manner by making sure who are not eligible for subsidy pay for what they consume. Such an approach can lower the subsidy burden on the Government. (economictimes.indiatimes.com)

February 24, 2015. The Centre informed the Delhi High Court (HC) that it has revised its schedule for auction of nearly operational coal mines and the bidding process is set to begin next week. The schedule was re-worked by the Coal Ministry after the court had said it has to give a detailed hearing to the petitions, which have also challenged the tender rules of eliminating 50 percent of the players in round one of the auction, and there was no urgency as far as nearly operational mines are concerned. Bhushan Power and Steel Ltd (BPSL) had opposed the government's decision to classify end-use of Jhamkhani coal block in Odisha for non-regulated sector, saying the move went against the 2014 coal ordinance provisions. BPSL and Monet Ispat and Energy Ltd have challenged the two-round financial bidding process under the ongoing coal auction, saying such a method was "arbitrary and irrational" as the ordinance and the rules under it did not provide for such a procedure. (economictimes.indiatimes.com)

February 23, 2015. After the auction of 19 coal blocks, power consumers in the country stand to gain over ` 30,000 crore over a period of time by way of a cut in electricity tariff, Power and Coal Ministry Piyush Goyal said. As per official estimates, auction of coal blocks will fetch over ` 1 lakh crore, including royalty, to six states. In the reverse bidding adopted for coal auction, government had set a ceiling price that was representative of production cost of Coal India. The private sector companies, which are considered more efficient, were expected to bid at lower price. For example, if the ceiling price is ` 1,000 and the bidder bids ` 800, then the benefit of ` 200 is directly passed on to consumers. This would mean if the power is sold at ` 3.50, out of which is ` 1 is cost coal and the same will become 80 paise because of pass through benefit of ` 200. Thus the new price of power will be ` 3.30 per unit. In case the bids touch zero, meaning that the private producer is ready to pass on the benefit of coal extraction to power consumers, there would be a forward bidding.

Of the total 204 coal blocks whose allocation was cancelled by the Supreme Court in September 2014, 19 were auctioned in the first tranche that concluded. Madhya Pradesh, Odisha, Jharkhand, West Bengal and Chhattisgarh and Bihar are the six states which will get ` 1 lakh crore from the auction. Hindalco Industries has bagged the maximum number of mines --three two in Chhattisgarh and one in Jharkhand. Other companies include Balco, Reliance Cement and GMR. In the entire auction, the lowest closing bid price was ` 108 per tonne for the Gare Palma IV 2 & 3 coal blocks in Chhattisgarh, won by Jindal Power Ltd. (economictimes.indiatimes.com)

February 23, 2015. The government is committed to bringing transparency in the allocation of natural resources including coal, the auctions for which have started and would result in lowering power tariff, President Pranab Mukherjee said. The swift and timely action taken by the government in this regard prevented the closure of mines which otherwise would have rendered thousands jobless, he said. In the coming years, the government would make focused efforts to expand exploration capacity and to increase domestic coal production to 1,000 million tonnes per annum (MTPA), he said. The government has already sold 19 coal blocks in the first phase of coal auctions. The coal auctions will fetch the states over ` 1 lakh crore. The auction of the first phase, which began on February 14, was completed. The second round of auction in which government has put on sale 21 mines will begin from February 25. (economictimes.indiatimes.com)

February 23, 2015. Monnet Ispat & Energy bagged one coal block in Chhattisgarh on the last day of the auction, bringing down the curtains on the first phase of coal auctions that will fetch the states over ` 1 lakh crore.  Hindalco Industries has bagged the maximum number of mines in the first phase of auction, winning three that includes two in Chhattisgarh and one in Jharkhand. In the entire auction, the lowest closing bid price was ` 108 per tonne for the Gare Palma IV 2 & 3 coal blocks in Chhattisgarh won by Jindal Power Ltd, while the highest closing bid price was ` 3,502 per tonne for Gare Palma IV/5 coal mine in Chhattisgarh alloted to Hindalco Industries. Gare Palma IV-7 mine in Chhattisgarh, earmarked for the non-power sector, was the most sought after one in the current lot put on auction in the first tranche. The Coal Ministry had earlier shortlisted 12 technically qualified bidders for the mine. Besides Monnet Ispat & Energy Ltd, other companies that were in the race for the coal blocks include Balco, Hindalco, JSPL and Jaiprakash Associates. Gare Palma IV-7 mines has extractable reserves of 52.98 million tonnes. (economictimes.indiatimes.com)

February 23, 2015. Coal block auctions will fetch a whopping ` 1.47 lakh crore and boost job creation, mining baron Anil Agarwal, who heads Vedanta Resources, said. Vedanta group has bid for the most number, 14 coal mines, putting in as many as 25 bids through several group firms but could grab only two through BALCO in the first round of auctions that concluded. However, Coal Secretary Anil Swarup said after the first round of auctions that ` 1.09 lakh crore of e-auction amount and ` 12,800 crore royalty would go to states in the next 30 years.

Vedanta Group firm Balco had won Chotia and Gare Palma IV/1 blocks, both in Chhatisgarh in the first tranche of auctions on February 17 and 21 respectively. For Chotia, the company had quoted ` 3,025 a tonne, the highest bid beating rivals Godawari Power & Ispat Ltd, Hindalco Industries, Prakash Industries, Rungta Mines and Ultratech Cement. The mine has extractable reserves of 13.57 million tonnes. The e-auction proceeds for the mine are calculated at ` 5,593 crore (for 30 years) for the state besides ` 489 crore royalty. (economictimes.indiatimes.com)

February 23 2015. Calling spent fuel of Kudankulam Nuclear Power Project (KKNPP) ‘nuclear waste’ would be a misnomer as India was one among the three countries in the world that followed “closed cycle” process in nuclear power generation, said S. Kalirajan, its Additional Chief Engineer. Delivering a talk on ‘Nuclear power and its benefits’ at a meeting organised by Tamil Nadu Chamber of Commerce and Industry, Kalirajan explained how uranium, used in KKNPP, got converted into plutonium as spent fuel, which would be used in fast breeder reactors, along with a blanket of thorium. The thorium blanket, in turn, transformed into uranium after its use and this could be used in breeder reactors as fuel. With this “closed cycle” technology, it would be possible to generate five lakh MW of power for 500 years with thorium-based reactors, he said. India had about one third of world’s thorium reserves. India, France and Russia were the only countries to adopt the “closed cycle” technology in nuclear power generation, Kalirajan said. Kalirajan said the current installed capacity from all energy sources was 2.4 lakh MW, which should provide 1,600 units per capita power per annum. But, the per capita power available was 860 units. The shortfall was caused due to low efficiency and transmission losses. By bringing down consumption levels and improving efficiency and production, the county could meet future power demands. Referring to the objective of achieving 7.5 lakh MW in 2032, Kalirajan said this would become a reality only through “energy mix,” by not depending on a single source. Power generation in the KKNPP’s second reactor was likely to begin by the year-end and tenders for excavation had been floated for the third and fourth reactors. Work on the fifth and the sixth reactors would begin in a few years, Kalirajan said. On completion, the nuclear power park would generate 6,000 MW. (www.thehindu.com)

February 23, 2015. The Samajwadi Party (SP) accused the Centre of being biased against Uttar Pradesh (UP) in the matter of power allocation.  Chowdhary, party spokesman and cabinet minister said the casual attitude of the BJP-led NDA government at the Centre created problems for Uttar Pradesh, which is facing a power crisis. While the state government has already taken several measures, including promotion of solar energy, Chowdhary said efforts were also made to ensure more purchase of electricity with the onset of summer. The Uttar Pradesh government is committed to its promise of providing 22-hour power supply to urban areas and 16-hour to district headquarters by 2016. The government is doing everything to make it (promise) possible, he said. Modalities for the purchase of additional power to the tune of 500-1,000 MW in April from Himachal Pradesh are also underway, the minister said. Referring to letters written by Chief Minister Akhilesh Yadav to Prime Minister Narendra Modi, Chowdhary said no action has been taken on these issues. (zeenews.india.com)

February 23, 2015. The Government of India and the Asian Development Bank (ADB) signed a $50.2 million loan agreement to continue to support improvements to transmission and distribution systems in the State of Assam for better electricity service to end users. The fourth tranche loan under the $200 million multi-tranche financing facility for the Assam Power Sector Enhancement Investment Program will build on earlier loans which aimed to improve operational efficiency in the sector through better transmission and distribution networks. The project, which is expected to be completed by December 31, 2018, will help Assam Power Distribution Company Limited (APDCL) add an additional 222 megavolt amperes (MVA) substation capacity and reduce system losses by 4%. Part of the loan will be used to enhance energy efficiency through renovation and modernization of existing 33/11 kilovolt (kV) substations. It will also deliver a dedicated power supply to tea estates by undertaking feeder separation for better service to the economically important tea sector. The loan of $50 million from ADBs ordinary capital resources makes up to 74% of the total project cost of almost $68 million, with the Government of Assam providing counterpart finance of $18 million. (www.business-standard.com)

February 22, 2015. World Bank Group's audit arm CAO (Compliance Advisor Ombudsman) will continue to monitor steps taken to address various environmental and social issues related to Tata Power's 4,000 MW Mundra power plant where IFC has invested USD 450 million. The move comes after CAO concluded that actions taken by the International Finance Corporation (IFC) were not "sufficient" with regard to addressing concerns over environmental and social impact of the Mundra project. In its response, the IFC -- a lender to the Gujarat-based Mundra Ultra Mega Power Project (UMPP) -- has agreed with conclusions of the CAO. The CAO reviews complaints from communities affected by development projects undertaken by IFC and the Multilateral Investment Guarantee Agency - the private sector lending arms of the World Bank Group. CAO had raised various concerns over environmental and social impact of the Mundra project. Following the same, IFC came out with an action plan in November 2013. Mundra project is being implemented by Coastal Gujarat Power Ltd (CGPL), a wholly-owned subsidiary of Tata Power. IFC said that it agrees with the CAO's conclusion. (economictimes.indiatimes.com)

February 21, 2015. At a time when the Delhi government is eyeing allocation coal blocks to set up a power plant, discoms have moved the central regulator complaining of low-grade coal being supplied to thermal stations at Dadri and Badarpur. In a letter to Central Electricity Regulatory Commission (CERC), discoms claimed they were paying more for lesser power being produced from low-grade coal and the costs were invariably being passed on to the consumers. Even the state-run NTPC expressed concern over the quality of the coal being supplied. According to the discoms, if the coal allocated to the Badarpur thermal plant is diverted to newer plants like Aravalli, the power production cost will go down and it will become affordable for the Delhi discoms. At present, the power companies do not buy power from Aravalli as it is "too costly". NTPC said it had no control over the quality of coal being used in these power plants as it was supplied directly by Coal India. Discoms said in their petition that until NTPC was completely transparent in their details of coal dispatched, coal burnt and quantum of power produced from Dadri and Badarpur stations, the increased variable costs paid to NTPC should be discontinued. Discoms said that with NTPC dilly-dallying on providing these cost details, state regulator DERC had denied them their quarterly fuel surcharge. A power plant like the one at Badarpur receives 90% of its coal supply from Coal India. Badarpur and Dadri plants collectively supply about 1,500 MW power to Delhi. According to the petition, the coal dispatched to these plants is about 5,000 kcal but the power produced from burning this coal only amounts to about 3,000 kcal coal. (economictimes.indiatimes.com)

February 20, 2015. The Aam Aadmi Party (AAP) government sought unhindered access to accounts of discoms for Comptroller and Auditor General (CAG) to carry out its comprehensive audit. It also claimed continuity with the previous regime as far as the decision to audit discom accounts is concerned, saying even the last government favoured the move. The state government assured the court it is not trying to interfere in the functioning of discoms but wants to subject the accounts to public scrutiny given the fact it has a substantial stake of 49% in them. The high court is hearing a batch of petitions filed by the discoms against the order of a single judge refusing to stay Delhi government's decision to a CAG audit of their accounts. The court is also hearing a PIL filed by NGO United RWAs Joint Action seeking the audit. (economictimes.indiatimes.com)

February 20, 2015. Coal India Ltd (CIL) said it is gearing up to invest about ` 6,000 crore towards capital expenditure in the next fiscal and an equal amount on augmenting other infrastructure, including rail connectivity. The announcement comes at a time when the company has a target to achieve an output of one billion tonnes by 2019-20. Further, an amount of around ` 6,000 crore has been earmarked by CIL for railway and other infrastructure development for 2015-16, the company said. The capex for entire infrastructure in Coal India for 2015-16 is close to ` 12,000 crore, CIL said. CIL said that annually ` 6,000 crore would be spent on mining and the remaining ` 6,000 on rail infrastructure and other related work. CIL also unveiled its roadmap, of strategies to be adopted, to attain the one billion tone coal production by 2019-20. With the projected coal demand of the country hovering around 1,200 million tonnes by 2019-20, at an envisaged growth rate of 7 percent, CIL is expected to chip in one billion tonnes, of which, 908 million tonnes is the expected contribution from the identified projects. (economictimes.indiatimes.com)

February 19, 2015. Indian metal and cement companies have bid aggressively for coal blocks in the country's first auctions to sell mines as they look to cut imports and their dependence on inefficient government monopoly Coal India Ltd (CIL). The auction follows a court cancellation of all previous licences and the initial bidding suggests companies are keen to secure supplies as the economy improves. The companies are allowed to bid for enough coal to fuel a 50 percent expansion of their current metal or cement capacity. The stiff competition may strain the balance sheets of the winners, including aluminium makers Hindalco Industries and BALCO, Jaiprakash Associates, Sunflag Iron and Steel, OCL Iron & Steel, Reliance Cement and Essar Power. Most of the winning bids so far have been higher than analysts' expectations based on the benchmark price of CIL. OCL, for example, would pay ` 2,302 ($37) per tonne, 50 percent more than Coal India's average price for the grade available in the mine OCL has won. The companies have declined to comment on the auctions until the whole process is complete, which should be March 5. Though world coal prices have fallen about 30 percent over the past year, a tonne of imported steelmaking coal costs about $120 in Indian ports while the thermal variety comes for $70. India is on track to overtake the United States as the second-largest coal consumer after China this decade, but Coal India has failed to ramp up supply in line with demand. Coal India's prices are set according to cost rather than based on supply and demand in the market and its costs are high at ` 1,118 per tonne, more than half of which comes from employee and social costs. (in.reuters.com)

February 18, 2015. The United States (US) has welcomed the signing of civil nuclear cooperation agreement between India and Sri Lanka, saying it is consistent with IAEA (International Atomic Energy Agency) safeguards and other international standards and practices. India and Sri Lanka signed a civil nuclear cooperation agreement, the first such deal signed by Sri Lanka with any foreign country, reflecting the new Lankan government's pro-India approach. The pact was signed after talks between Prime Minister Narendra Modi and new Sri Lankan President Maithripala Sirisena who chose India for his maiden foreign visit after assuming charge following a bitter presidential poll. According to the nuclear deal, India will assist Sri Lanka in developing its civil nuclear energy infrastructure, including sharing of resources, training of personnel and extending expertise. It will also facilitate cooperation in radioactive waste management and nuclear and radiological disaster mitigation and environmental protection. (www.business-standard.com)

 [INTERNATIONAL: OIL & GAS]

February 23, 2015. Statoil ASA reported the start of production from Oseberg Delta 2 in the North Sea. The field is tied back 14 km to Oseberg field’s center by two subsea templates with total capacity for eight wells. The initial phase involves three oil producers and two gas injectors. Total investment is slightly less than 7 billion kroner, Statoil said. The development plan was submitted to the Ministry of Petroleum and Energy in May 2013 and approved that October. Recoverable reserves are estimated at 77 million barrel of oil equivalent (boe) during an estimated life of 20 years. Oil accounts for 32 million boe and gas 45 million boe. Production is from 3,100 m under the seafloor. Statoil said oil from two wells on the “Delta terrace” has been produced since 2008. (www.ogj.com)

February 23, 2015. Gulfsands Petroleum has confirmed as a gas discovery the Douar Ouled Balkhair 1 gas exploration well (DOB-1) in northern Morocco. Gulfsands said that, during testing of the discovery, gas flowed to the surface at rates in excess of 10 million cubic feet per day. DOB-1 has been suspended as a future gas production well. The first two wells – LTU-1 and DRC-1 – to be drilled on this permit were also successful in finding gas and flowing it to surface. While the primary reservoir target found gas that flowed at a rate of 10 million cubic feet per day, the secondary target was unable be tested due to mechanical problems with well bore integrity above the interval. The company is currently attempting to determine the optimal path for further exploration of this reservoir. (www.rigzone.com)

February 22, 2015. Chevron Corp said it will give up shale gas exploration plans in Romania, after an assessment showed the Black Sea state does not compete favourably with other investment opportunities. Energy firms have been attracted by estimates of massive shale gas reserves in Poland and Romania. The U.S. energy major took a similar decision to discontinue its operations in Poland. (www.reuters.com)

February 19, 2015. U.S. oil production is set to fall this year as drastic drilling cutbacks take hold faster than world governments expected, according to the biggest, fastest-growing shale company. EOG Resources Inc.’s forecast contradicts most estimates that see U.S. production rising, including those by the U.S. Energy Information Administration and the International Energy Agency. The company said the crude market would rebound quickly and labeled the current downturn a “short cycle.” The Texas producer said its own production would bottom in the second and third quarter, resulting in output remaining unchanged for the year compared to last year’s breakneck pace of growth. The deciding factor in what has been viewed as a price war with Saudi Arabia and its OPEC allies is how many of the thousands of U.S. producers will follow suit. So far company response has been mixed as some producers focus on preserving cash flow to fund their operations. Others are insulated from the effect of the market crash by hedging contracts that locked in a higher price for some of their production in 2015. Noble Energy Inc., Devon Energy Corp. and Marathon Oil Corp., three other companies with significant shale operations, said they will boost output this year. More than half of Devon’s 2015 oil production is hedged at a price of $90.75 a barrel. Apache Corp. plans to pump about the same volume of oil as last year. Meanwhile, Saudi Arabia is boosting production in a bid to maintain market share. Crude oil output is about 10 million barrels a day, New York-based Pira Energy Group said. That would be the highest since July and up from an average of 9.7 million barrels a day in the second half of 2014, according to data from the Joint Organisations Data Initiative, an industry group supervised by the Riyadh-based International Energy Forum. (www.bloomberg.com)

February 19, 2015. GeoPark has discovered new oil field following completion of drilling operations on exploration well Tilo 1, which is located on the Llanos 34 Block in Colombia. GeoPark operates the Llanos 34 Block with 45% working interest. The tests resulted in a production rate of approximately 1,000 barrels of oil per day of 14.2 degree API, with approximately 10% water cu, the company said. The company will carry out technical evaluation to determine if the Tilo field is potentially a northeast extension of the larger Tigana field. GeoPark is an oil and gas explorer, operator and consolidator and has operations in Chile, Colombia, Brazil, Argentina and Peru. (www.energy-business-review.com)

February 18, 2015. Independent oil and gas firm Aminex has edged closer to first commercial gas production from its Kiliwani North field in Tanzania, after reporting that the pipeline construction from Songo Songo has been completed. The firm reported that Tanzanian Petroleum Development Corporation is constructing the skid metering unit within the boundaries of the Kiliwani North Development Lease prior to tying-in the Kiliwani North-1 wellhead. Pressure testing of the pipeline is expected to begin shortly and the final construction equipment required to connect KN-1 is also expected soon. The KN-1 well, when connected to the export pipeline, is expected to produce at least 20 million cubic feet of gas per day. Gas from KN-1 will be processed at Songo Songo and then be sold in the Dar es Salaam to Mnazi Bay pipeline. (www.rigzone.com)

February 23, 2015. French energy company Total is planning to expand its network of petrol stations in Germany, its chief executive Patrick Pouyanne said. Total operates about 1,200 petrol stations in Germany, ranking it a distant third after Aral and Shell. Pouyanne called for dialogue in the current spat between Moscow and the West. Total's refinery in Leuna, Germany, uses Russian oil, Pouyanne said. (af.reuters.com)

February 22, 2015. The largest U.S. refinery strike in 35 years entered its fourth week as workers at 12 refineries accounting for one-fifth of national production capacity were walking picket lines. Talks may resume by mid-week to end the walkout by 6,550 members of the United Steelworkers union (USW) at 15 plants, including the 12 refineries. Representatives of both sides said no date has been set to restart negotiations, however. The strike comes as U.S. workers seek more pay in a strengthening economy. Wal-Mart Stores Inc has said its U.S. workers will get a raise to at least $9 an hour, while West Coast port workers have reached a tentative deal for a new contract after a months-long dispute. The refinery work stoppage began on Feb. 1 when talks for a new three-year contract between the USW and lead oil company negotiator Shell Oil Co broke down. The work stoppage includes the nation's largest refinery, Motiva's 600,250 barrel per day (bpd) Port Arthur, Texas, refinery. USW members are also picketing at Motiva's 235,000 bpd Convent, Louisiana, and 238,000 bpd Norco, Louisiana, refineries and the Shell chemical plant in Norco. (www.downstreamtoday.com)

February 21, 2015. Brazil's state-run oil company Petroleo Brasileiro SA (Petrobras) plans to complete repairs to a broken catalytic cracking unit at its REDUC refinery by March 7, the union representing workers at the plant said. The problem at the 240,000-barrel-a-day refinery near Rio de Janeiro forced Petrobras to cut oil processing by about 7,000 cubic meters (44,029 barrels) a day for more than 10 days. The U-1250 unit produces gasoline and liquefied petroleum gas (LPG). It had to be shut down unexpectedly of problems inside the unit tower led to lower-than-normal output and a leak of catalysts. Petrobras said that the stoppage of the U-1250 unit was planned. The union says the stoppage was an emergency shutdown, the result of the company reducing maintenance in order to run its 13 principal refineries in Brazil at nearly full capacity to meet surging local demand and reduce imports. Until the recent decline in world oil and fuel prices, Petrobras was forced by Brazil's government to sell imported fuel at below world market prices, causing large losses for the company at a time when it was making some of the world's largest corporate investments. (www.downstreamtoday.com)

February 23, 2015. Train derailments involving crude oil and ethanol in the United States will cost more than $18 billion over the next 20 years, according to an assessment by the United States Department of Transportation (USDOT). USDOT forecasts there will be just over 200 derailments involving trains carrying 20 or more tank cars of crude or ethanol between 2015 and 2034, an average of more than 10 per year, based on analysis of previous accidents and predicted growth in traffic volumes. USDOT calculates the risks posed by oil and ethanol by rail shipments using the same method RAND Corp has developed for estimating risks associated with terrorism. Risk is the product of threat, vulnerability and consequence. In the case of oil by rail, the threat is the probability of a major rail accident involving multiple tank cars carrying flammable liquid. Vulnerability is the probability flammable liquids will be released and catch fire, given an accident has occurred. And consequence is based on estimated damages. USDOT identified 36,500 miles of rail corridors being used to transport crude and ethanol across the United States in 2012. Population density averages about 283 persons per square kilometre along these rail corridors, according to USDOT. (www.reuters.com)

February 19, 2015. Russia's Gazprom said it had discussed possible cooperation with Algeria's state energy firm Sonatrach on supplies of liquefied natural gas (LNG). It said that drilling at the El Assel oil and gas block in Algeria, jointly developed by Gazprom and Sonatrach, has confirmed the existence of hydrocarbon resources. (www.downstreamtoday.com)

February 19, 2015. Slovak gas pipeline operator Eustream has sold additional capacity in a pipeline carrying supplies to Ukraine through the end of 2016, bringing total capacity to 14.6 billion cubic metres per year, it said. Eustream said demand was high for extra capacity in the pipeline. (www.downstreamtoday.com)

February 19, 2015. The Canadian company behind the long-delayed Keystone XL oil pipeline will seek U.S. government approval for another pipeline — this one going north. The proposed Upland Pipeline could reduce reliance on the railroads to ship crude following recent concerns about safety. TransCanada Corp.'s proposed $600 million Upland Pipeline would begin near the northwestern North Dakota oil hub of Williston and go north into Canada about 200 miles. At peak operation it would transport up to 300,000 barrels of oil daily, connecting with other pipelines, including the Energy East pipeline across Canada. TransCanada hopes to have the Upland Pipeline operating in 2018, pending approval from the U.S. State Department, North Dakota's Public Service Commission and Canada's National Energy Board. The company plans to submit an application to the State Department in the second quarter of this year. TransCanada has been trying for years to get U.S. approval for the 1,179-mile Keystone XL, which would connect Canada's tar sands to refineries on the U.S. Gulf Coast but has sparked environmental objections. Congress last week approved construction, but President Barack Obama has threatened to veto the measure. North Dakota, the nation's No. 2 oil state behind Texas, is producing about 1.2 million barrels of crude daily. Several pipeline projects are proposed to move the oil, 60 percent of which is being hauled by rail, according to North Dakota Pipeline Authority. (www.downstreamtoday.com)

February 18, 2015. Gulf energy company Qatargas is in the final stages of talks on a deal to supply Pakistan with 3 million tonnes of liquefied natural gas (LNG) annually for 15 years. The deal would help Pakistan tackle serious energy shortages and power cuts which can last up to 20 hours a day. Nearly half the country's electricity is generated by gas and its output of 4.1 billion cubic feet per day is well short of demand for as much as 6 billion, depending on the time of year. The deal would be signed in weeks, while a second said the first shipment would be received by March. Pakistan State Oil (PSO) frequently suffers severe cash flow problems due to payment delays from its customers. It was forced to slash petrol imports by half in January and stop fuel oil imports altogether. The company said the situation was resolved. (www.downstreamtoday.com)

February 18, 2015. Middle East oil producers already scrapping for share in Asia must now contend with more supply from Russia. Russia, the world’s second biggest crude producer, boosted sales to China, Japan and South Korea by 25 percent last year, increasing its portion of shipments to 8.7 percent, from 7.2 percent in 2013, according to government data. Saudi Arabia accounted for 24 percent, down from 26 percent, while Qatar and Kuwait also ceded market share. Gulf producers are offering record discounts for Asian buyers amid a global crude glut. As European demand weakens and shale takes the U.S. closer to energy self-sufficiency than at any time since the 1980s, suppliers are focusing on Asia, which the International Energy Agency forecasts will replace the Americas as the biggest consuming region this year. Rising sales to Asia are helping Russia’s economy weather the conflict in Ukraine, sanctions and collapsing energy prices. Russia sold about 51 million metric tons of crude to China, Japan and South Korea last year, from 41 million in 2013, the data show. (www.bloomberg.com)

February 24, 2015. OPEC has no plans to hold an emergency meeting amid falling oil prices, according to a delegate from the group. Crude prices have dropped almost 50 percent from a June peak as the Organization of Petroleum Exporting Countries (OPEC) refused to cut production and U.S. output reached a three-decade high. There have been no concrete discussions about holding an emergency meeting, said the delegate, who asked not to be identified because the group’s talks are private. OPEC’s next regular meeting is schedule for June 5. Brent for April settlement, the international benchmark, slipped 5 cents to $58.85 a barrel on the London-based ICE Futures Europe exchange. Prices rebounded to gain as much as 45 cents in intraday trading after OPEC President Diezani Alison-Madueke said. OPEC, which supplies about 40 percent of the world’s crude, pumped 30.9 million barrels a day in January, exceeding its target for an eighth straight month, according to production estimates. The Energy Information Administration forecast that U.S. output will increase to 9.3 million barrels a day this year, the most since 1972. Crude stockpiles in the country rose to 425.6 million barrels as of Feb. 13, the most in EIA weekly data beginning 1982. (www.bloomberg.com)

February 20, 2015. Royal Dutch Shell Plc and any oil drilling company that prospects in the Arctic Ocean must boost safety practices to prevent spills in the frigid and often hostile waters or mitigate the impact, U.S. regulators proposed. The Interior Department’s first Arctic-specific drilling rules respond to mishaps that plagued Shell’s efforts three years ago, by shortening the drilling season and requiring companies to have a backup rig nearby. Shell had already agreed to do much of what’s in the proposal as part of its 2012 exploration plan, which was suspended after the stumbles. The plan from Interior marks the latest in a series of measures from President Barack Obama’s administration to regulate offshore or Alaskan oil production. Obama declared Alaska’s Bristol Bay and the Arctic National Wildlife Refuge as off limits for oil drilling last month, and issued an offshore drilling plan that reduced areas for exploration in the Arctic. Those plans were denounced by oil industry lobbyists and Republican lawmakers from Alaska. Still, Shell neither complained nor praised the proposed rule. Shell has said it wants to resume exploration when the weather gets warmer this year after halting operations in 2012 when a drilling rig ran aground and it was fined for air pollution. Environmental groups, citing harsh conditions and a fragile ecosystem, say it’s a mistake to drill in the region. Oil exploration and production companies in the past decade stepped up plans to drill in the Arctic, using technology that may let them reach reserves trapped in the sea floor beneath ice. The Chukchi and Beaufort Seas may contain 24 billion barrels of oil, according to the U.S. Geological Survey. (www.bloomberg.com)

February 18, 2015. Woodside Petroleum Ltd., Australia’s second-largest oil and gas producer, cut its spending plans by about 20 percent, joining global energy companies in trimming costs after a plunge in crude prices. Woodside expects to spend about $6.2 billion in 2015 with low oil prices expected to continue for an “extended period,” the Perth-based company said after posting a 38 percent gain in full-year profit. It wrote down the value of oil and gas assets last year by $196 million. The slide in crude prices has forced the industry to reduce more than $40 billion in spending and lower the value of their oil holdings. Santos Ltd., Australia’s third-largest oil producer, is slashing spending, cutting jobs and considering asset sales to cope with the downturn. Even after its $2.75 billion agreement in December to purchase stakes in Apache Corp. assets, Woodside has a strong balance sheet that may allow the company to make another acquisition and take advantage of low crude prices, according to a report from Goldman Sachs Group Inc. (www.bloomberg.com)

February 18, 2015. South Africa’s inflation rate fell to 4.4 percent in January as gasoline prices fell, giving the central bank room to keep interest rates unchanged. Inflation slowed from 5.3 percent in December, the Pretoria-based statistics office said. The median estimate of 24 economists surveyed was 4.5 percent. Prices fell 0.2 percent in the month. Brent crude oil prices dropped by almost 60 percent between June and January, helping to contain inflation in Africa’s second-largest economy as gasoline costs declined. The central bank, which aims to keep inflation in a range of 3 percent to 6 percent, left its benchmark repurchase rate unchanged at 5.75 percent on Jan. 29. The slowdown in inflation gives policy makers room to pause its rate-tightening cycle, the bank said. The core inflation rate, which excludes food, non-alcoholic beverages, gasoline and electricity costs, rose to 5.8 percent in January from 5.7 percent in the previous month. (www.bloomberg.com)

February 18, 2015. Warren Buffett’s decision to dump his stake in Exxon Mobil Corp. after oil prices plunged is pointing investors toward smaller, more nimble producers that will deliver higher returns during a market recovery. Buffett’s Berkshire Hathaway Inc. sold its entire position in Exxon during the final three months of last year, according to a regulatory filing. The exit marks the end of a $3.7 billion investment in 2013 that at the time was Buffett’s biggest single bet since he bought into International Business Machines Corp. two years earlier. Buffett’s fourth-quarter divestments in the energy sector also included ConocoPhillips, the Houston-based crude and gas producer that spun off its oil-refining business in 2012. The spinoff created Phillips 66, which comprised the second-largest energy holding in Buffett’s portfolio on a dollar basis as of Dec. 31, after Suncor. (www.bloomberg.com)

 [INTERNATIONAL: POWER]

February 23, 2015. Bosnia state-owned coal mine operator Banovici has selected four firms for the final round of a qualifying tender to develop a 350 MW coal-fired power plant in the country. Banovici said that Shanghai Electric Group, China Gezhouba Group, Dongfang Electric and a Abengoa-led consortium have been shortlisted. Construction on the project is scheduled to begin in 2016 and the plant is expected to be commissioned in 2020. Bids were received from 13 companies and consortia last year, and 11 of them were shortlisted in May 2014. Banovici said that the lowest preliminary bid was placed by Dongfang Electric for €388mn ($440.69 mn) for the construction of the power plant. Banovici is planning to float a tender in the second half of this year for final technical and financial offers from bidders and the award the contract by the end of the year. The company will feed the new facility from the adjacent Banovici brown coal mines. It currently operates coal mines which are estimated to have reserves of 147 million tons and average annual output of 1.5 million tons. Bosnia sources 60% of its electric power from coal-fired facilities. (fossilfuel.energy-business-review.com)

February 22, 2015. President Goodluck Jonathan inaugurated the rehabilitated Unit 6 and the overhauled Unit 4 of the Egbin Power Station in Lagos, which effectively added 240 MW to the national grid and also restored the power plant to its full capacity of 1,320 MW. With the completion of the projects, the country’s power generation capacity now stands at 5,500 MW for the first time in history but actual generation was 3,800 MW as a result of the recent acts of vandalism one of the Escravos-Lagos pipeline network, which supplies gas to some power stations. President Jonathan stated that based on the progress made so far, the country would get out of the current epileptic power supply very soon. He said the fact remained that electricity would continued to be the catalyst for the growth of economy, adding that a successful stabilisation of power would ultimately improve the lives of millions of Nigerians. He said the power reform was to actualise the essence of the Electric Power Sector Reform Act of 2005, which strives to open up the sector and bring in the private ownership, management and financing to the industry. He said the planned rehabilitation of the remaining four units by the new owners would increase the lifespan of the power station by additional 20 years. (www.thisdaylive.com)

February 22, 2015. Plans for a hydro-electric power plant between Zambia and Zimbabwe have been expanded to 2,400 MW from 1,600 MW. A recent study showed that the Batoka Gorge power plant would produce more electricity than previously envisaged, according to Munyaradzi Munodawafa, chief executive of the company in charge of the project, the Zambezi River Authority. The completion of the project, which will involve the construction of a dam and a hydro power plant on the Zambezi River, is expected to ease an electricity shortage in the two countries and southern Africa. Munodawafa said a feasibility study was almost complete and a report would be ready by May after which an environmental impact assessment study would be done by June. The cost, previously estimated at $2.5 billion, would be known in May after the feasibility study, Munodawafa said. (af.reuters.com)

February 20, 2015. One of Brazil's two nuclear reactors has been disconnected because of a flaw in a condenser that cools the steam used by the plant's electric power generator. Eletronuclear that operates the Angra Nuclear I power plant in the coastal city of Angra dos Reis in the state of Rio de Janeiro said that the plant was disconnected to safeguard of other equipment such as steam generators. Eletronuclear said the condenser is not located in the "nuclear area of the plant" and that the flaw did not represent risks to workers, the public or the environment. (www.business-standard.com)

February 23, 2015. As the country braces for an energy shortage in the next months, Sen. Miriam Defensor-Santiago has expressed concern about China’s stake in the National Grid Corp. of the Philippines (NGCP), which manages electricity transmission in the country. The power industry has been infected with a “national security virus” since a firm run by the Chinese government holds 40 percent of NGCP’s capital stock, Santiago said. Santiago did not name the Chinese company but State Grid Corp. of China is one the companies that comprise the private consortium making up the NGCP. The others are One Taipan Holdings Corp. and Calaca High Power Corp., each with a 30-percent stake. The Senate is deliberating on a joint resolution that would give President Aquino special powers to address the looming power shortage. The House of Representatives approved its version of the measure last year. Among other things, the resolution seeks to encourage businesses to join the interruptible load program in which they would use their own generators during peak hours, with the government reimbursing them. The Malampaya Fund royalties from the gas fields off Palawan province would be tapped for the program. Santiago said the joint resolution was too broad, noting that it cannot fix problems in the Electric Power Industry Reform Act. (business.inquirer.net)

February 22 2015. Some residents of the Upper Lake Melville area will be without power for most of the afternoon. Newfoundland and Labrador Hydro is conducting repairs to the transmission line between Churchill Falls and Happy Valley-Goose Bay between 1-6 p.m. While Hydro is able to provide power to the majority of residential customers in Goose Bay with back-up generation other areas will be left in the dark. The area spanning from the Happy Valley-Goose Bay dock to North West River including the communities of North West River and Sheshatshiu will be without power as will be some isolated streets in the town. (www.vocm.com)

February 20, 2015. France and Spain inaugurated a cross-border power line, doubling the amount of electricity the countries can exchange as the European Union (EU) pushes for stronger ties between national grid systems within the bloc. The Santa Llogaia-Baixas link will raise electricity interconnection capacity between France and Spain to 2,800 MW from 1,400 MW, the European Commission said. One megawatt can supply about 2,000 European households. The EU contributed € 255 million ($290 million) toward the project’s total cost of € 700 million, said the commission, the bloc’s executive arm. The EU wants its 28 member nations to be able to transmit at least 10 percent of the power they produce across borders by 2020. Until now, interconnection capacity between France and Spain covered only 3 percent of peak demand in the Iberian Peninsula, preventing companies in the region from participating in the EU’s internal power market. (www.bloomberg.com)

February 18, 2015. Prysmian Group has received two new contracts, valued more than €50mn, to support the power transmission system expansion projects in Kuwait. As part of the contract awarded by Kuwait Minister for Electricity & Water (MEW), Prysmian will support MEW 06 Jaber Al Ahmed City project, which is a part of the Kuwait power transmission system expansion plan. The Kuwait power transmission system expansion plan is intended to boost the main transmission networks and also enable secure power supplies across the country. As part of the two contracts, Prysmian will be responsible for design, engineering, procurement, construction, installation and commissioning services of HV underground cable systems for a total of 210km of 132kV cable and related network components for both projects. Installation work is scheduled to commence in 2015 and is expected to be completed during 2016. (www.energy-business-review.com)

February 22, 2015. A group of Qatari state-linked investors and three Japanese power firms have signed an agreement to study the possibility of developing projects in Turkey's Afsin Elbistan region, one of the Qatari firms said. The Afsin-Elbistan region holds up to 45 percent of Turkey's reserves of lignite, or brown coal, and Turkish authorities have been keen to attract investment into the region to help meet growing electricity demand. (www.reuters.com)

February 22, 2015. U.S. Secretary of State John Kerry joined negotiations in Geneva over Iran’s nuclear work amid pressure from Israeli Prime Minister Benjamin Netanyahu to halt the talks with the Islamic Republic. Kerry and U.S. Energy Secretary Ernest Moniz met with Iranian Foreign Minister Mohammad Javad Zarif and the country’s top atomic-energy official, Ali Akbar Salehi. The IAEA (International Atomic Energy Agency) reported that while Iran was sticking to an interim deal with world powers, cutting its most sensitive nuclear work in exchange for limited sanctions relief, inspectors couldn’t guarantee that its past work was exclusively peaceful. Iran has said IAEA inspectors are basing their 12-year-old case on forged documents. The U.S. said that providing fake blueprints was part of its strategy to stifle suspected weapons work. The biggest differences separating the sides are over Iran’s uranium-enrichment capacity and the pace at which international sanctions will be lifted. The Persian Gulf country, which holds the world’s fourth-largest oil reserves, has resisted cutting its installed enrichment capacity, something world powers have said is a nonstarter for lifting sanctions. Diplomats have given themselves until March 24 to agree on the framework for a deal. (www.bloomberg.com)

February 19, 2015. Colombia’s main coal railway is taking legal action to alter a ban on nighttime transportation that threatens to squeeze exports to European power producers including Electricite de France SA and Germany’s EON SE. Railway operator Ferrocarriles del Norte de Colombia SA, or Fenoco, is asking the Constitutional Court to revise a Feb. 13 ban on transportation between 10:30 p.m. and 4:30 a.m. following noise complaints from locals, Mines and Energy Minister Tomas Gonzalez said. The ministry has sent a request to the court. Coal is Colombia’s main export after oil and a key source of government revenue. The Andean nation produced 88.6 million metric tons last year and is targeting 100 million tons by 2018, Gonzalez said. The Netherlands and Turkey are the top destinations for Colombia’s coal exports, according to the government’s mining and energy planning unit. (www.bloomberg.com)

 [RENEWABLE ENERGY / CLIMATE CHANGE TRENDS]

February 24, 2015. The Environment Ministry is likely to take a call this week on giving a green clearance to Jindal Power Ltd for setting up 3,097 MW hydro electric project in Dibang Valley of Arunachal Pradesh. It is also expected to decide on granting green nod to two major irrigation projects - the Lower Penganga Inter-state Irrigation project in Maharashtra and construction of flood carrier canal project in Tamil Nadu. These three proposals are listed for environmental clearances before the 82^nd meeting of the Expert Appraisal Committee of the Environment Ministry, which is scheduled to be held on February 26-27. (economictimes.indiatimes.com)

February 24, 2015. Power and automation technology company ABB India sees a huge business potential in converting diesel-powered or grid-power irrigation water pump sets to solar pumps. At present, only 10,000 solar pump sets have been installed of which 3,000 are by ABB India. Western states, especially Maharashtra, Madhya Pradesh, Rajasthan and Gujarat, have taken the lead in converting or installing solar pumps. Installation has begun to pick up in southern states led by Karnataka and then followed by Andhra Pradesh and Tamil Nadu, ABB India said. (www.thehindubusinessline.com)

February 24, 2015. Maharashtra government will implement the central scheme of distributing solar pumps to farmers in the state on pilot basis. The approval to implement the scheme was given in a Cabinet meeting chaired by Chief Minister Devendra Fadnavis, wherein sanction is given to distribute 7540 solar pumps as a pilot project, with an estimated expenditure of ` 445 crore. Most of the power generation in the state is coal-based and it results in air pollution thus hurting environment while non-conventional energy is everlasting and hence use of solar pumps for agriculture will prove useful. At present, substantial amount of electricity is used for agriculture in the state and is given at concessional rates to agriculturists who also receive various grants. The Central government has decided to provide one lakh solar pumps to reduce dependence on the coal-based energy. Farmers with less than five acres of land for irrigation, specially in drought-prone areas as well as those in remote areas where there is a shortage of electricity would be benefited from the scheme. Contractors for the pumps will be decided through e-tendering and the beneficiary will have to share 5 percent of the expenditure for installing the solar pump. (zeenews.india.com)

February 24, 2015. Sumeet Industries is going to setup 10.5 MW (5 Turbines of 2.1 MW each) wind power plant at a capital cost of ` 77.51 crore and for the said project IDBI Bank has sanctioned ` 57.75 crore. This power plant will be operational within six months. Pursuant to this, the company’s profitability will improve further due to low cost of energy. Not only that, after completion of six years from this project, company will receive 2.70 crore units of Electricity only at a cost of ` 1.30 paise. (money.livemint.com)

February 23, 2015. President Pranab Mukherjee said that the share of renewable power generation will be enhanced to 15 percent of the total energy mix in the next seven years. The scheme for setting up 25 mega solar parks has been approved. The implementation of the Green Energy Corridor Scheme has also been accelerated. Setting up solar generation capacities along the international borders will be a key area, he said. Mukherjee said that similar attention is being paid to bio-mass and hydro energy. (timesofindia.indiatimes.com)

February 22, 2015. The Goa government is promoting the use of solar cookers through grant of subsidy under a scheme to be implemented under Goa energy development agency (GEDA). An allocation of 24 lakh has been earmarked to allow beneficiaries to purchase box type solar cookers and a total of 1,500 sets will be distributed under the scheme. The cost of the cooker will be shared equally by GEDA and the beneficiary. As the depletion of conventional energy sources is a global problem, the government has promoted the scheme to utilize non-conventional renewable energy sources. Only those beneficiaries residing in Goa and holding ration cards are entitled for benefits under this scheme. The grants will be disbursed as one installment to the beneficiary on receipt of application. In another scheme, the government will promote Sarai cookers, also to save energy by use of natural sources of energy. The government has allocated 1,60,000 as the amount of subsidy for this scheme. The grants shall be disbursed to the beneficiary of 40% or 800 whichever is less on successful installation, supply of Sarai cookers of 12 litre capacity. (timesofindia.indiatimes.com)

February 22, 2015. Madhya Pradesh-based Aakriti Group plans to diversify into renewable energy sector to generate 20 MW power through solar and biomass sources in the state's Narmada belt. The group presently owns four sugar factories in the Narmada belt at Kareli (near Narsingpur), Shahpura (near Jabalpur), Saikheda (near Gadarwara) and Salichouka (near Narsinghpur) where a lot of sugarcane waste is generated. The group, which came into existence in 1996, also has major interest in infrastructure and housing sector. It has a turnover of ` 350-400 crore at present and is planning to take it to ` 3,000 crore by 2020. The company plans to enter Indore, Raipur (Chhattisgarh) and Nagpur (Maharashtra) in real-estate sector.

Besides setting up environment-friendly projects in the state capital, the group has also come up with a unique housing project - 'The Nest' - for senior citizens. The Nest has a tie-up with leading hospitals of the city for providing round-the-clock medical services with a dedicated ambulance and also has a well secured campus with fool-proof security for the senior citizens. The group has diversified into health care and education sector by setting up a state-of-the-art nature cure centre and also a school providing value-based education to children. (economictimes.indiatimes.com)

February 21, 2015. Many of India's coal-based power plants are way below global standards in terms of efficiency and several among them violate air pollution norms and are struggling to dispose fly ash generated by them, a study by a leading NGO working in the environment sector has claimed. Centre for Science and Environment (CSE), in its two-year long study 'Heat in Power', analysed and rated 47 coal-based thermal power plants on nearly 60 environmental and energy parameters and found that the sector scores poorly overall. The study claimed the average efficiency of the plants, it assessed, was 32.8 percent, one of the lowest among major coal -based power producing countries. It claimed that average CO₂ emission was 1.08 kg per kWh, 14 percent higher than that of China.

Among the top performing units, as per the study, were West Bengal based CESC-Budge Budge Generating Station, followed by JSEWL power station Toranagallu in Karnataka and Tata-Trombay Thermal Power station in Mumbai. However, 40 percent of the plants received less than 20 percent score pointing to a dismal state of affairs, the CSE claimed. The CSE report was critical of National Thermal Power Corporation (NTPC) and said its plants that were rated received scores of 16-28 percent. The poorest of the lot was Delhi's Badarpur plant. CSE functionaries, however, added that NTPC did not disclose its data and was rated based on a primary survey and publicly available information. The study had found that plants were operating at 60-70 percent capacity only and if capacity utilisation is improved, the sector can meet additional power requirement without emphasising too much on building new plants. As per the study, India's thermal plants are estimated to withdraw around 22 billion cubic metre of water, which is over half of India's domestic water need. Even plants with cooling towers consume water which is way above what is consumed in countries like China, the study claimed. (economictimes.indiatimes.com)

February 20, 2015. The 24 government-run companies that have promised to generate 18,819 MW of green energy capacity in five years include NTPC Ltd., Satluj Jal Vidyut Nigam Ltd., Coal India Ltd., National Hydroelectric Power Corporation Ltd. and SAIL (India) Ltd. Other than power generation, Green Brilliance Energy Pvt. Ltd. and CVC India Infrastructure Pvt. Ltd. have committed $2 billion to produce 3 lakh tonnes each of bioethanol and pellets. K.C. Renewable Energy Pvt. Ltd. have committed to producing 4,000 cubic metres of biogas, while Jakson Engineers Ltd. plans to set up Solar RO systems and mobile and semi-mobile generators. Twelve private firms have committed to manufacturing equipment that could generate 43,300 MW of renewable energy. (www.thehindu.com)

February 19, 2015. Real estate developer Hallmark has made a foray into the renewable energy sector and plans to set up a 50 MW solar power plant in Tamil Nadu. On the real estate front, Hallmark Grouphas completed over 0.5 million square foot of construction activities and has set a target to construct over 10 million square foot over the next four years. The company's upcoming project Hallmark Emerald was launched by popular film actress Hansika Motwani. Hallmark Emerald would come up on a 6.82 acre land at Singaperumal Kovil near Chennai. It would have 860 apartment of 11 to 18 floors with single and double bed room units. The apartments range from ` 28 lakh. The delivery of the project was expected to happen by December. The company is eyeing generate revenue of ` 450 crore from this project. (economictimes.indiatimes.com)

February 19, 2015. The wholesale market complex in Koyambedu which supplies fresh produce for the city will soon supply fuel to cook the produce. The biomethanation plant, which has been generating electricity from vegetable waste, will now also use waste from slaughterhouses, hotels, treated sewage sludge and banana stems to supply biogas to neighbouring houses. Chennai Metropolitan Development Authority (CMDA), which set up the biogas plant along with CSIR-Central Leather Research Institute, will work on upgrading the existing plant. The upgrade, which will be done after feasibility tests, is expected to cost around ` 10 lakh. The plant, which started in 2006 and operated through a private agency, had been generating biogas which was converted into electricity through an engine. With the market complex generating 30 tonnes of waste daily, the plant was producing between 500 units and 4,000 units of electricity. But since its launch, the plant faced glitches with the engine failing and for a few years, the biogas was not put to any use. With the present 30 tonnes of waste generating about 2,400 cubic meters of biogas, CMDA said the fuel can be supplied to about 2,000 households. Apartment complexes near the plant have been identified for the direct supply of biogas and officials plan to approach the residents and conduct a workshop. They will also check the feasibility of supplying gas either through pipeline or bottling it. The corporation also showed interest in converting slaughterhouse waste and hotel waste to biogas fuel. Before it can be supplied to households, biogas will be subjected to a procedure where the carbon-dioxide and hydrogen sulphide content is removed and the overall pressure compressed. (timesofindia.indiatimes.com)

February 19, 2015. Renewable energy player ACME Group said it will invest ` 600 crore to develop 74 MW of solar PV power projects in Punjab. Delhi-based ACME is one of several companies that have won mandates to install solar power projects in the state. According to the bid document floated by the Punjab government, ACME will be signing two power purchase agreements—one for 24 MW at 7.16/ kWh and the other for 50 MW at 7.06/ kWh. Punjab, which receives sunshine for about 300 days in a year, has the potential to generate solar energy at 4-7 KWh/sqm, the company said. ACME, which has 701 MW of installed capacity including the proposed Punjab project, aims to touch 7,500 MW by 2019. (economictimes.indiatimes.com)

February 18, 2015. Defence Minister Manohar Parrikar inaugurated the state's first concentrated solar thermal technology at the 53-year-old Lakaki dry cleaners and art dyers factory premises at Dicarpale, near 3 MTR office mess, Quepem road, Navelim. Parrikar appreciated the initiative of the proprietor Venkatesh Naik Dalal to conserve energy by utilising solar power instead of the uneconomical diesel. Recalling his efforts to harness wind power during his tenure at chief minister of Goa, Parrikar emphasized that petrol, being imported from other countries, would soon be exhausted and urged those gathered to switch to non-conventional energy as promoted by Prime Minister Narendra Modi. (timesofindia.indiatimes.com)

February 23, 2015. The world’s states should commit to a legally binding emissions cut of 60% by 2050, with five-yearly reviews, in a Paris Protocol to replace the moribund Kyoto agreement at a climate summit later this year, according to a leaked European Union (EU) document. But environmentalists have questioned the integrity of the headline 60% figure, and a strategy which is seen as overly-tilted towards the US. The EU accounts for nine percent of global emissions, compared to China’s 24%, and the 12% emitted by the US, according to the document. As soon as that number reached 80% - or 40 Gigatones of CO₂ equivalent pollution - the new Paris Protocol would kick in. Environmentalists welcomed the EU’s attempt to keep emissions cuts within the rubric of a legally binding deal, rather than seeing it relegated to a protocol annex. But many noted that the 60% CO₂ cut would be measured against 2010 levels, and was thus the same as the bloc’s previous aspiration of a 50% cut measured against 1990 levels - itself a genuflection to a 2007 IPCC report seen as outdated. The five-yearly review suggestion is viewed by green NGOs as a concession to advance the EU’s ten-year emission-cutting model onto other countries. The previous Kyoto agreement had begun with a five-year commitment period, which President Obama implicitly acknowledged in his offer of CO₂ reductions by 2025. (www.theguardian.com)

February 20, 2015. Southern Co., the third-largest U.S. utility owner by market value, bought two solar power plants in Georgia from developer Tradewind Energy Inc. The Southern Power unit acquired the 80 MW Decatur Parkway Solar Project and the 19 MW Decatur County Solar Project, the Atlanta-based company said. The projects are expected to use solar panels from a top supplier, Southern Co. said. Construction on the larger project is scheduled to begin this month while work on the 19 MW plant will begin in June. Southern’s regional utility Georgia Power has agreed to buy electricity from the plants. With the acquisitions announced, Southern Power owns or has under development about 670 MW of renewable energy capacity. (www.bloomberg.com)

February 20, 2015. Deutsche Bank AG said it’s working to boost its investment in green bonds to €1 billion ($1.1 billion), joining competitors including Citigroup Inc. and Barclays Plc in tapping profit from the quickly growing market. The Frankfurt-based institution has invested €200 million in green bonds and intends to expand that starting with purchases of a 10-year issue from the World Bank, according to Deutsche Bank. The funds are for the bank’s liquidity reserves. The decision adds to evidence that the green bond market is blooming after issuances of securities linked to climate projects more than doubled to a record $38.8 billion last year. Investors are snapping up bonds to finance the global expansion of clean energy, promoted by governments from the U.S. to China to tackle climate change. The debt, issued by development banks or by project sponsors themselves, offers investors an alternative to volatile equities. It’s also increasing the flow of cash for clean-energy developments in nations from Spain to Romania, which have reined in support for the industry. Investment in clean energy rose 16 percent last year to a record $310 billion. KfW Group, Germany’s state-owned development bank, sold $1.5 billion of green bonds in the U.S. in 2014 after receiving demand for $2.5 billion of the securities. (www.bloomberg.com)

February 20, 2015. Apple Inc., which has been working secretly on a car, is pushing its team to begin production of an electric vehicle as early as 2020. The timeframe -- automakers typically spend five to seven years developing a car -- underscores the project’s aggressive goals and could set the stage for a battle for customers with Tesla Motors Inc. and General Motors Co. Both automakers are targeting a 2017 release of an electric vehicle that can go more than 200 miles on a single charge and cost less than $40,000. Tesla’s success in creating a startup car company has shown that the traditional barriers of entry into the auto industry aren’t as difficult to overcome as originally thought. At the same time, automakers have struggled to bring technical leaps to car development, something that Silicon Valley is also seeking to accomplish. For example, Google Inc. has invested in developing an autonomous vehicle since 2010. (www.bloomberg.com)

February 20, 2015. Pattern Energy Group’s parent company Pattern Energy Group LP (Pattern Development) has inked a joint venture (JV) agreement with Cemex Energia, which is a subsidiary of Cemex, SAB. de CV. The JV will develop renewable energy projects throughout Mexico. Mexico is a natural expansion market due to Pattern Development's headquarters in Houston and its team's experience in developing over 1,000 MW of wind projects in California, New Mexico and Texas. Following recent reforms in the country's energy laws, which includes a mandate for 35% of generation to come from clean resources by 2024, there is significant opportunities for development of wind and solar resources in the country. Pattern Development owns about 25% stake in Pattern Energy, which has the right of first offer to acquire projects developed by Pattern Development. (www.energy-business-review.com)

February 20, 2015. General Motors Co. (GM) signed its first wind power contract, agreeing to buy 34 MW from a project being built in Mexico by Enel Green Power SpA. The American carmaker will use power from the wind farm in Palo Alto, Mexico, at its Toluca facility west of Mexico City, GM said. Remaining power from the 17 wind turbines will be used at the Silao, San Luis Potosi and Ramos Arizpe complexes, it said. When the project is operating, GM will get more than 12 percent of its North American energy consumption from renewable sources. (www.bloomberg.com)

February 19, 2015. The U.S. Environmental Protection Agency (EPA) plans to offer a proposal for Renewable Fuels Standards for 2014, 2015, and 2016 this spring, and will use actual production levels to determine last year's mandated volumes. The agency will address all three years at once and plans to look at broader changes to address long-term issues of demand as well as arguments from refiners that ethanol blending capacity has hit its peak, said Christopher Grundler, a director at the EPA's Office of Air Quality and Transportation, at an industry conference in Grapevine, Texas. Further, the agency will likely set mandated volumes for 2014 that are near last year's actual production levels. The EPA is late in designating volumes for ethanol and other biofuels to be blended into the domestic fuel supply.

The agency has struggled to increase the mandated levels as designated in a plan laid out by Congress in 2007 as growth of overall fuels demand has slowed. Last year, makers of ethanol and other renewable fuels pumped out more than 17 billion gallons, above the revised target of 15.2 billion the EPA proposed in late 2013. Grundler said he could not give specific plans for determining the 2015 volumes, but said the agency hopes to get on track in setting targets for the 2016 year.

The EPA is meant to issue mandates for a year of fuel blending by November of the preceding year. The EPA has been inundated with public comments after proposing in 2013 sharp cuts to blending volumes for ethanol and other biofuels. Broader changes to the RFS program are needed, he said. Grundler said industry expectations that the EPA could propose the targets by March would not likely be met. (www.downstreamtoday.com)

February 18, 2015. Citigroup Inc. plans to lend, invest and facilitate deals worth $100 billion by 2025 to support projects that will fight climate change and protect the environment. Citigroup expects the effort to lead to deals supporting renewable power, energy efficiency and sustainable transportation opportunities. The effort builds on an earlier goal to arrange $50 billion in deals that the bank set for itself in 2007 and achieved in 2013, three years ahead of schedule.

Citigroup’s new target puts it well ahead of other financial companies, including Bank of America Corp., which said in 2012 it would support $50 billion in deals for low-carbon initiatives, and Goldman Sachs Group Inc., which announced a $40 billion program the same year. Citigroup helped arrange financing for the $2.74 billion Solar Star projects in California. SunPower Corp. is building the two solar farms for Warren Buffett’s MidAmerican Energy Holdings Co. They’re expected to have a total of 579 MW of capacity when completed this year. (www.bloomberg.com)

February 18, 2015. Iberdrola SA, Spain’s largest electricity company, said profit declined for a fourth year after the government cut renewable-power subsidies to the industry. Net income fell to €2.33 billion ($2.65 billion) from €2.57 billion a year earlier, the Bilbao-based company said. That compared with the average €2.37 billion estimate of 37 analysts surveyed.

Iberdrola’s power output increased 1.8 percent last year as industrial demand in Spain grew 5 percent, helping to compensate for lower demand in the U.K. and the U.S. The company lost €339 million of state subsidies during the year from changes to the Spanish’s government’s renewable-energy policies. (www.bloomberg.com)

February 18, 2015. Orix Corp. and Kyudenko Corp. started building a 23 MW solar power station in western Japan. The plant in Nara prefecture will begin operations in February, 2017, the two companies said. Separately, Orix, a Tokyo-based finance and leasing company, and Kyudenko, a builder of power transmission facilities based in Fukuoka, said that they’re building an 11 MW solar power plant in the southwestern prefecture of Kumamoto. (www.bloomberg.com)

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