MonitorsPublished on Jan 24, 2017
Energy News Monitor | Volume XIII: Issue 32


Monthly Non-Fossil Fuels News Commentary: December 2016 – January 2017


The call to make solar roof tops mandatory for all upcoming residential societies along with a ban on use of diesel generator sets in highly-polluted urban areas like Delhi from CSE made it to the headlines.  Decline in cost of solar panels including the capital cost is said to have reduced the levelised cost of electricity from solar panels to ₹ 10/kWh compared to ₹ 27-33/kWh for electricity from diesel generators. While one cannot dispute the numbers, especially when the sun is shining, these widely quoted figures ignore some basic facts about electricity and the way in which users view electricity.  Electricity is a heterogeneous good along time, space, and lead time.

Laws of electromagnetism constrain storage, transmission and flexibility of electricity and different sources such as coal, diesel and solar produce different goods with different heterogeneity and marginal value.  Fuels that can be used at any time, any place and at the lowest lead time to generate electricity command a premium because users want electricity at any time, any place and with the lowest possible lead time. That is among many reasons why residential complexes in Delhi and its surrounding areas invest in a diesel generator rather than in solar systems notwithstanding the campaign by the activist groups that solar power is cheaper. If any energy fuel for electricity generation is really cheap and in addition met the expectations on reliability, robustness and lead time one would not require activist groups to promote that source of energy. The recommendation on making roof top solar mandatory also ignores the finding that when it comes to evaluating the impact of subsidies for solar, roof tops produce lower ‘bang for the buck’ than utility scale plants. Moving to transmission corridors being built especially for renewable energy, Mercom Capital report that said that infrastructural development under the green energy corridor was slow and not at par with the pace of tenders coming out was surprising. Over the next three quarters, solar projects of approximately 9 GW is expected to be commissioned, but the grid is said to be unprepared. The Power Grid Corp of India is reportedly developing the inter-state transmission corridor and the state transmission utilities are said to be responsible for setting up and strengthening the intra-state transmission infrastructure. The MNRE is reported to be providing 40 percent of project costs in the form of a grant. The argument that there is inadequate transmission capacity to evacuate power is not new and is heard even in the case of hydro power projects in remote locations. The presumption is that demand will materialise if there is transmission capacity. The reality probably that transmission capacity will materialise if there is demand.

After a long pause of many years news on bio-fuels has started appearing in the media. One was that poll-bound Punjab would get a Second Generation Ethanol Bio-refinery as the Centre at village Tarkhanwala, Bathinda. With an investment of nearly ₹ 600 crore, HPCL, a Public Sector Undertaking, is setting up the project. The production of Second Generation Ethanol from agricultural residues to provide additional sources of remuneration to farmers. It is also expected to address the growing environmental concerns and support the EBP programme for achieving 10 percent Ethanol Blending in Petrol. Oil PSUs are reportedly planning to set up twelve 2G Ethanol Bio-refineries across 11 States such as Punjab, Haryana, UP, MP, Bihar, Assam, Odisha, Gujarat, Maharashtra, Karnataka and AP. IOC and BPCL are said to have a pact with the Pune-headquartered engineering company Praj Industries to set up plants to manufacture ethanol.


Moving to nuclear power, it was reported that the government had decided to increase the nuclear power generation capacity of atomic reactors at Kovvada in Andhra Pradesh by nearly 20 percent, and that a fresh Environment Impact Assessment was being carried out.  The capacity of 6×1000 MW has been increased to 6×1280 MW. The reactors at Jaitapur, being built by French company EDF, have a capacity of 1,650 MW, while the Kudankulam Nuclear Power Plant, being built with Russian assistance, has the generation capacity of 1,000 MW.

The IWT has remained in the news for some months now.  The latest development is that the World Bank, one of the original sponsors of the IWT had decided to stall the two parallel processes – appointment of a neutral expert and setting up of a court of arbitration – to resolve the disputes over Kishenganga and Ratle hydroelectric projects in J&K. The hope probably is that India and Pakistan would resolve the issues in an amicable manner and in line with the spirit of the Treaty.

Rest of the World

The global renewable finance sector has been at the forefront in declaring the death of coal. The latest is the report in Bloomberg that in 2016, countries from Chile to the United Arab Emirates broke records with deals to generate electricity from sunshine for less than $0.03/kWh half the average global cost of coal power. Auctions in other countries such as Saudi Arabia, Jordan and Mexico are expected to take the prices even lower.  According to the report, since 2009, solar prices have fallen by 62 percent, with every part of the supply chain trimming costs. By 2025, solar will be cheaper than using coal on average globally, says Bloomberg New Energy Finance. Surprisingly the report also included the rebuttal from the coal industry that cost comparisons involving renewables do not take into account the need to maintain backup supplies and that when those expenses are included, coal remains more economical.

In the nuclear sector there was disappointing news for advocates of nuclear energy in USA with the announcement that the aging Indian Point nuclear power plant will be shut down in 2021. Located along the lower Hudson River about 30 miles north of New York City, Indian Point produces 2,000 MW of electrical power, which is a quarter of the power used in New York City and Westchester County.  The plant’s two reactors went online in 1974 and 1976.

In Japan, a government panel that has held intensive meetings since October said the next six months will be ‘make or break’ for TEPCO’s reform efforts, after it earlier nearly doubled the estimated costs of the Fukushima disaster to more than $180 billion.

MW: Megawatt, GW: Gigawatt, kWh: Kilowatt hour, EBP: Ethanol Blended Petrol, TEPCO: Tokyo Electric Power Company, UP: Uttar Pradesh, MP: Madhya Pradesh, AP: Andhra Pradesh, J&K: Jammu and Kashmir,   IOC: Indian Oil Corp, BPCL: Bharat Petroleum Corp Ltd, HPCL: Hindustan Petroleum Corp Ltd, IWT: Indus Waters Treaty, MNRE: Ministry of New and Renewable Energy, CSE: Centre for Science and Environment, PSUs: Public Sector Undertakings


MobiKwik registers 10 times growth in oil, gas sector

January 17, 2017. Domestic mobile wallet major MobiKwik announced that it registered 10 times growth within the past week in transactions from the oil and gas sector. Mobikwik powers digital payments for all major petrol vends of Hindustan Petroleum Corp, Bharat Petroleum Corp and Indian Oil Corp in 20 cities. MobiKwik recently announced zero surcharge on all transactions from oil and gas sector.

Source: The Economic Times

For RIL, demonetisation had positive impact on retail but petrochemicals demand hit

January 17, 2017. Reliance Industries Ltd (RIL) saw a positive impact of demonetisation on its organised retail business, but demand growth was affected in petrochemicals and petrol pumps, the company said. The company’s petrochemicals business did well, but not without hiccups, which are temporary. In the petrol pumps segment, Public Sector Undertakings (PSUs) gained as scrapped notes were made valid for fuel purchases from their retail outlets but the same concession was not extended to private pumps.

Source: The Economic Times

Oil, gas conservation fortnight Saksham 2017 begins with petroleum industry support

January 17, 2017. To create awareness among the public about the need for judicious use and conservation of petroleum products and help protect environment, the oil industry under the aegis of the ministry of petroleum and natural gas and the Petroleum Conservation Research Association (PCRA) will organize oil and gas conservation fortnight this month. This year, ‘SAKSHAM 2017’ (Sanrakshan Kshamta Mahotsav) is being observed by the oil industry across the country from January 16 to February 15. Also, mass awareness campaigns will be organized by oil companies in Punjab during the fortnight. Governor of Punjab and UT administrator VP Singh Badnore inaugurated ‘SAKSHAM- 2017’ at a function organized by the oil industry at Tagore Theatre. The governor appreciated the efforts of oil and gas companies in spreading the message of conservation of petroleum products.

Source: The Economic Times

Budget 2017: Ministry seeks cut in excise duty on ATF

January 17, 2017. The civil aviation ministry, as part of its Budget recommendations, has sought a reduction in excise duty on aviation turbine fuel (ATF), or jet fuel, to 8% from 14%, by rolling back an increase made last year. The government had raised the duty to compensate for its tax loss, as global crude oil prices fell to below $30 a barrel. Crude oil prices have doubled now. Rising fuel cost is a concern for the airline industry, which has started reporting profits after a long spell of losses. A more than 20% increase in air passengers and low fuel prices were the key drivers of the improved performance. To be sure, the duty hike helped temper volatility in fuel prices — though local prices didn’t fall in line with global rates earlier, they may not rise too much either now, if the government rolls back the tax increase it made.

Source: The Economic Times

Karnataka allows sale of kerosene in open market

January 17, 2017. The Karnataka government has decided to allow the sale of white kerosene in open market. State Food and Civil Supplies Minister UT Khader said that the government has issued an order this effect. Those interested in selling white kerosene in open market can approach the office of the Food and Civil Supplies in their districts, he said. He said the government will take steps to distribute pulses to the PDS (public distribution system) cardholders below the poverty line. Chief Minister Siddaramaiah had announced that PDS cardholders below the poverty line would get protein-rich commodities in addition to the carbohydrate-rich ones.

Source: The Hindu Business Line

Petrol price hiked by 42 paise a litre, diesel by  1.03

January 16, 2017. Following the recent spurt in oil prices to well over $50 a barrel, Indian Oil Corp (IOC) hiked prices of petrol by 42 paise a litre, and of diesel by ₹ 1.03, both in Delhi. Petrol per litre now costs ₹ 71.14 in Delhi, ₹ 73.66 in Kolkata, ₹ 77.96 in Mumbai and ₹ 70.61 in Chennai. Similarly, the new diesel price is ₹ 59.02 in Delhi, ₹ 61.27 in Kolkata, ₹ 64.89 in Mumbai and ₹ 60.73 in Chennai. Rates were last hiked on January 1, petrol by ₹ 1.29 a litre, and diesel by ₹ 97 paise, both in Delhi, with corresponding changes in other states.

Source: Business Standard

India fuel consumption to hit 200 mt in 2016/17: Oil Ministry

January 16, 2017. India’s fuel consumption is likely to hit 200 million tonnes (mt) in 2016/17, the oil ministry said, in what would be the highest such level in at least 16 years. India’s fuel consumption surged 10.9 percent to 183.5 mt in 2015/16. A level of 200 mt would compare to almost 1 billion tonnes in United States (US) fuel consumption and to around 575 million tonnes of demand in China.

Source: Reuters

No returning to subsidies on petrol, diesel: Govt

January 16, 2017. The government ruled out reverting to the system of subsidising auto fuel but said it may resort to cut in excise duties if rate hike “pinches hard” even as there has been ₹ 5.21 per litre hike in petrol price and ₹ 4.45 in diesel rates since December. The surge in international oil prices has led to petrol prices being hiked for the fourth time since December and thrice in case of diesel. When oil prices slumped in the second half of 2014 and early 2015, the government hiked excise duty on petrol and diesel nine times to mop up additional revenues that helped it meet its revenue and fiscal deficit targets. In all, it raised excise duty on petrol by ₹ 11.77 a litre and that on diesel by ₹ 13.47.

Source: The Economic Times

BJP, SP at war over cut in kerosene quota for distribution in UP

January 15, 2017. Bharatiya Janata Party (BJP) has raised voice against the ruling Samajwadi Party (SP) on the issue of distribution of kerosene. Alleging that the state government is deliberately trying to brew resentment among people against the BJP-led NDA government at Centre on the issue of kerosene, BJP Kashi Pranth (regional) unit has made a complaint with the Election Commission (EC). In a complaint forwarded to EC on behalf of party, vice-president of BJP Kashi Pranth unit Neelkanth Tiwari said the Union government had allocated the quota of 2,23,416 kl of kerosene to Uttar Pradesh (UP) on December 28, 2016 for distribution through fair price shops. However, the food and civil supply department of UP issued an order on January 9 to release this quota to the dealers by curtailing 22,782 kl of kerosene. According to joint secretary of Superior Kerosene Oil (SKO) Dealers Association Lalit Kumar, the quota of kerosene of states is released by the Centre on quarterly basis. He said that on getting 10% less quota of third quarter of 2016-17 financial year, the 11 dealers of three petroleum companies in the district contacted the state office-bearers when it came to light that Centre had not reduced the quota but it had been curtailed by the civil supply department of the state. The dealers are also supplying 10% less oil to the fair price shop owners.

Source: The Economic Times


India’s 2016 Iran oil imports hit record high

January 13, 2017. India’s annual oil imports from Iran surged to a record high in 2016 as some refiners resumed purchases after the lifting of sanctions against Tehran, according to ship tracking data and a report. The sharp increase propelled Iran into fourth place among India’s suppliers in 2016, up from seventh position in 2015. It used to be India’s second-biggest supplier before sanctions. For the year, the world’s third-biggest oil consumer bought about 473,000 barrels per day (bpd) of oil from Iran to feed expanding refining capacity, up from 208,300 bpd in 2015, the data showed. In December, imports from Iran trebled from a year earlier to about 546,600 bpd. In 2015 refiners slowed purchases due to sanctions which choked payment routes, insurance and halved Iran’s exports. Indian refiners Reliance Industries Ltd, Hindustan Petroleum Corp Ltd (HPCL), Bharat Petroleum Corp Ltd and HPCL-Mittal Energy Ltd (HMEL) last year resumed imports from Tehran, attracted by the discount offered by Iran.

Source: Business Standard

Consumers, petrol pumps not to bear card transaction fee: Oil Minister

January 12, 2017. Oil Minister Dharmendra Pradhan said consumers and petrol pump owners will not have to bear the transaction charge for using plastic money to pay for fuel. He said banks and government-run fuel retailers will bear any burden of merchant discount rate (MDR, or transaction fee) on card transactions at petrol pumps.

Source: The Times of India


ONGC’s KG gas field to touch peak in July

January 17, 2017. Oil and Natural Gas Corp (ONGC) expects to scale peak output of about 5 million metric standard cubic meters per day (mmscmd) from its Vashishta gas field in Krishna-Godavari (KG) Basin by July this year. Vashishta and S1 gas fields, located in the KG Offshore Basin off the east coast of India, began operations in September last year. The fields were developed under a greenfield deepwater development project at an investment of $751.65 million. The Vashishta field is estimated to produce 9.56 billion cubic metres (bcm) over a period of nine years with peak production reaching 3.55 mmscmd during the first five years. The S1 field is expected to deliver 6.22 bcm over a period of eight years with a peak production of 2.2 mmscmd for the first five years. As part of the Vashishta and S1 field development, ONGC is drilling four wells and shipping the gas from them through a sub-sea pipeline to an onshore terminal at Odalarevu in Andhra Pradesh, he said. Vashishta is the first field in the country to get the premium price of gas. In March last year, the government had allowed higher price for new gas production from difficulties areas like deep sea, ultra deepwater and high pressure, high temperature areas. When ONGC started production the premium price was $6.61 per million British thermal unit (mmBut) as against a cap price of $3.06 per mmBut for regular fields. The premium price for period between October 2016 and March 2017 was cut to $5.3 per mmBtu based on benchmark rates in gas surplus economies. The rate for regular gas price also declined to $2.50 per mmBtu. The gas was sold to state gas utility GAIL.

Source: The Economic Times

Cairn India gets nod for drilling 64 exploratory, appraisal wells in KG Basin

January 17, 2017. A committee under the Ministry of Environment, Forests and Climate Change has given a green signal to Cairn India for undertaking drilling works of 64 exploratory and appraisal wells in KG-OSN-2009/3 block in KG Basin at Prakasam and Guntur districts of Andhra Pradesh. The Expert Appraisal Committee (EAC) while according to environmental clearance set a few conditions along with other specific and general environmental conditions relevant to the project proposal. Cairn India has proposed for drilling of 55 exploratory and 11 appraisal wells in KG-OSN-2009/3 block in Offshore KG Basin. The offshore block in the Bay of Bengal along the coast of Andhra Pradesh is spread over an area of about 1988 km. The block covers partly the offshore areas of Prakasam and Guntur districts.

Source: The Indian Express

Centre’s penalty on producing gas from ONGC share not sustainable: RIL

January 17, 2017. Reliance Industries Ltd (RIL) said it was confident that the Union government’s penalty on producing natural gas from ONGC’s share of natural gas in the KG Basin is “not sustainable”.  In November, the government slapped a $1.55 billion penalty on RIL. The company has served an arbitration notice against the penalty.

Source: Business Standard


CIL to restart search to secure coal assets overseas

January 17, 2017. Coal India Ltd (CIL) will again scout for reserves of coking coal and high-grade low ash thermal coal in countries such as the US, Colombia, Canada, Australia, Indonesia and South Africa. Mozambique, where last year it had to surrender a block taken for exploration because of its unfavourable geology, is not among the target countries this time, according to bid documents released by CIL. The public sector behemoth appears to be a little behind in seizing the opportunity to secure assets when coal prices were low, experts said. But the CIL management is of the view that asset prices may have still not bottomed out. Several coal producers in the US, including Peabody Energy Corp—the world’s largest private sector coal miner—were until recently wallowing in losses and had filed for bankruptcy last year in the wake of falling coal prices. But coal prices have started to firm up again, and many of them might emerge from the crisis within months with the help of fresh bank funding. Inviting bids from investment bankers, CIL said it will not be able to meet the demand for coking coal and high-grade low ash thermal coal from its own mines in India, despite efforts to ramp up production. Reserves of recoverable coking coal, which is used in production of steel, is limited in India, and high-grade low ash thermal coal is almost unavailable in India, the document said. This isn’t the first time CIL is scouting for assets abroad. Under the leadership of Partha S. Bhattacharyya, who retired as CIL chairman in February 2011, the company had almost concluded a deal to acquire a 10% stake in Peabody Energy, which would have given it access to a large volume of coking coal mined in Australia at a concessional price. But the deal didn’t materialise because there were no clear guidelines on overseas acquisitions, Bhattacharyya had then said.

Source: Livemint

Coal imports down 25 percent at 14 mt in December

January 16, 2017. Coal imports fell by 25 percent to 14.31 million tonnes (mt) in December, due to higher availability of domestic fuel. The country had imported 19.15 mt of coal in December 2015. The coal import in November, 2016 was at 12.51 mt. Further, mjunction, an online procurement and sales platform floated jointly by Steel Authority of India Ltd and Tata Steel said, there was sharp increase in non-coking coal imports in December as compared to November last year as non-power sector consumers started stocking up the material in the aftermath of softness in international prices towards end of November. International coal prices softened by 15 percent in the first week of December 2016 compared with the prices prevailing in the third week of November and this prompted price-sensitive Indian consumers to bring in higher quantities of imported coal that has consistency in quality, mjunction said. Expressing concern over import of coal despite being surplus in the dry fuel, Coal Minister Piyush Goyal had said that Coal India Ltd (CIL) has set a target to replace about 15 mt of imported coal with indigenous fuel in the next few months. Helped by a record coal production by the world’s largest coal miner CIL, India reduced its import bill of the dry fuel by more than ₹ 28,000 crore in the last fiscal.

Source: The Economic Times

Coal consumers express concern on coking coal price hike by CIL

January 14, 2017. Coal consumers said hike in coking coal prices by Coal India Ltd (CIL)’s subsidiaries could lead to an increase of power generating cost by ₹ 0.40 per unit and would hurt the steel industry, which is facing subdued demand. Bharat Coking Coal Ltd (BCCL) increased its coking coal prices by about 20 percent while Central Coalfields Ltd (CCL) raised its prices. Coal consumers said price hike would compel power utilities along with steel and related industries buying coal from BCCL and CCL to import fossil fuel. Overall impact is huge on power houses buying coal from BCCL as well as steel industry which is reeling under dampening demand, she said, adding that this hike would discourage fair competition and buying coal from BCCL may not be viable for power utilities as per unit cost would be much more than others.

Source: Business Standard

MCL’s coal corridor reduces pollution at Talcher

January 13, 2017. Opening of the 21 km-long coal corridor at Talcher in Odisha has led to significant reduction in pollution and has impacted its environment in a positive manner. The coal corridor constructed by Mahanadi Coalfields Ltd (MCL) at an estimated cost of ₹ 243 crore and thrown open last month, it has reduced daily movement of about 3000 heavy vehicles through village roads and colonies which had become a matter of great concern. The average pollution index has shown a significant drop in Talcher township after December 15, 2016, as coal laden vehicles plied on the dedicated coal corridor by-passing eight thickly populated villages and nine colonies. Covering over 500 sq km area in Angul district of Odisha, Talcher Coalfields has reserves of 38.65 billion tonne dry fuel, the highest in India.

Source: Business Standard

Court pulls up CBI on final coal block probe report

January 13, 2017. A court pulled up the Central Bureau of Investigation (CBI) for not filing in the proper manner the final report in the coal block allocation case against former Congress MP and industrialist Naveen Jindal and others. The final investigation report was filed on the basis of the statement given by prosecution witness, Chartered Accountant and New Delhi Exim Pvt Ltd Director Suresh Singhal, who has turned approver in the case. Special Judge Bharat Parashar pulled up the probe agency for not filing the report in a proper format and asked it to file it as per the provisions of law by January 23. Meanwhile, the CBI Investigating officer (IO) of the case told court that further investigation in the matter is complete. The CBI with its report has also submitted expert opinion from the Central Forensic Science Laboratory (CFSL) and statement of at least 50 prosecution witnesses, including Singhal, and supplementary list of documents and articles. The case relates to the allocation of Jharkhand’s Amarkonda Murgadangal coal block to Jindal Steel and Gagan Sponge. Besides the industrialist, former Minister of State for Coal Dasari Narayana Rao, former Jharkhand Chief Minister Madhu Koda, former Coal Secretary H.C. Gupta are also accused in the case. The CBI in April 2015 filed a chargesheet against Jindal, Koda, Rao and Gupta. The other accused in the case include Jindal Realty Director Rajeev Jain, Gagan Sponge Directors Girish Kumar Juneja and R.K. Saraf and Sowbhagya Media’s Managing Director K. Ramakrishna. Five private companies — four based in Delhi and one in Hyderabad — were also named in the chargesheet. The companies are Jindal Steel and Power Ltd., Gagan Sponge Iron Pvt Ltd, Jindal Reality Pvt Ltd, New Delhi Exim Pvt Ltd and Sowbhagya Media Ltd. The accused have denied the charges.

Source: Business Standard

Jharkhand coal mine reopens after 18 killed in collapse

January 13, 2017. The coal mine in Jharkhand where 18 people died last month after a collapse has resumed partial production, the operator said, even as operations continued to recover five bodies still believed trapped in another part of the mining area. The accident on December 29 at the Lalmatia mine, one of India’s largest, forced a complete halt in production of the 50,000 tonnes of coal mined daily. The mine is run by a subsidiary of state giant Coal India Ltd (CIL), which has a patchy safety record, with 135 accidents reported in 2015. The mine is now producing 15,000 tonnes of coal per day, with a plan to increase output gradually to 30,000 tonnes within two days, Eastern Coalfields Ltd (ECL) said. The company said in December that fog had slowed rescue operations as authorities tried to clear the collapsed mine waste. The Lalmatia open cast mine has an annual capacity of 17 million tonnes and accounts for about half of ECL’s coal production. Coal output from the mine this month could fall 30 percent, the company said. ECL last month accounted for about 9 percent of CIL’s total production of 50 million tonnes.

Source: Reuters


Haryana power utilities giving digital payment a push

January 16, 2017. Giving digital payments a push, the Dakshin Haryana Bijli Vitran Nigam (DHBVN) has decided to accept payments of electricity bills exceeding ₹ 25,000 and ₹ 15,000 through Real Time Gross Settlement (RTGS) or National Electronic Funds Transfer (NEFT) in two phases. In the first phase, up to March 31, all payments of electricity bills for more than Rs 25,000 in urban and rural areas will be accepted only through RTGS, NEFT or online mode. The existing limit is ₹ 1 lakh. Thereafter, in the second phase, with effect from April 1, all payments of electricity bills exceeding ₹ 15,000 in urban and rural areas will be accepted through RTGS or NEFT or online mode. Payment made through online mode such as net banking, credit card and debit card will be considered on a par with RTGS and NEFT for the purpose, the DHBVN said.

Source: The Economic Times

Sikkim likely to join power distribution reform scheme UDAY

January 16, 2017. Sikkim is likely to join Ujjawal Discom Assurance Yojana (UDAY) taking the tally of states accepting the centre’s electricity distribution revival scheme to 22, amid growing focus on power reforms. The north-eastern state had an average aggregate technical and commercial (AT&C) loss level of 45.51 percent, at the end of March 2015. The state government has projected bringing down the losses to 20 percent by 2021-22. UDAY was launched by the government in November 2015 to ensure financial stability for debt-ridden distribution utilities. Sikkim’s power department had nil outstanding debt at the end of March 2015, Power Minister Piyush Goyal had said.

Source: The Economic Times

Surplus power in India: Now heavy users to pay lower tariffs

January 14, 2017. Major reforms of power tariffs are on the horizon as an official committee has recommended lower tariffs for heavy users to encourage electricity consumption as the country moves from a deficit to surplus situation. In India, power consumers have always been paying higher bills for higher consumption. Slabs are fixed and if you fall in the higher consumption range, you pay more. It’s time the country doles out incentives for high power consumption, a committee constituted to advise the government on ways to increase electricity demand has said. The committee comprises of chairman of the Central Electricity Authority, secretary of the Central Electricity Regulatory Commission (CERC), president of industry body FICCI, energy secretaries of Bihar and Tamil Nadu and principal energy secretaries of Madhya Pradesh, Gujarat and Uttar Pradesh. The committee is in the process of finalising its report and is likely to present it to the power ministry by January-end. The committee is of the view that to boost electricity demand, rebates and incentives in electricity bills be extended to consumers. The state electricity regulatory commissions should revise the tariff design for all consumers, particularly industry, commercial and service sectors. Presently, consumers are penalised by way of higher tariffs for higher consumption. The committee opines in the draft report that more states can offer power at lower rates to industries during night and off-peak hours. Such system of differential tariff is in place in some states and Madhya Pradesh has seen increase in power consumption. The committee has also explored other short term and long term options for enhancing power consumption. These include promoting manufacturing under Make in India through electricity assurance, encouraging use of electric vehicles and electric equipment in construction activities. The government planned to introduce a new tariff structure to charge more from large domestic power consumers rather than industrial units that currently share the cross subsidy burden. Most states categorise households consuming more than 800 units of power a month as large domestic consumers.

Source: The Economic Times


Sterlite Power commissions Purulia-Kharagpur project

January 13, 2017. Sterlite Power announced commissioning of Purulia-Kharagpur transmission project that will supply 1,200 MW electricity to Jharkhand and West Bengal. The project consists of two 400-kv double circuit lines with a total length of 273 km, including the 112-km Purulia-Ranchi and 161-km Kharagpur-Chaibasa lines. Sterlite Power will operate and maintain the project — traversing through Jharkhand and West Bengal — for 35 years. The Purulia-Ranchi line connects Purulia Pumped Storage Power Project (PSPP) in West Bengal and the 765/400-kv sub-station of Power Grid Corporation in Jharkhand. The Kharagpur-Chaibasa line connects sub-stations of PowerGrid and West Bengal utility in Chaibasa and Kharagpur, respectively. With the commissioning of its fifth project, Sterlite Power is now managing a portfolio of 4,063 circuit km of operational transmission lines and two sub-stations spread across 11 states.

Source: Business Standard

Modi govt’s reforms creating positive impact on India’s power sector: WCA

January 12, 2017. Global coal industry body World Coal Association (WCA) said it welcomes the news that ratings agency Moody’s has upgraded the outlook for India’s power sector to stable from negative in view of surge in domestic coal production. The WCA will continue to support India’s energy sector, especially in the deployment of available technologies that will ensure coal is used as cleanly as possible, WCA said. According to the International Energy Agency (IEA), coal will continue to make the largest contribution to electricity generation in India through to 2040. The country is also predicted to drive global demand for coal in the decades to come. More than 300 million people in India are without access to electricity.

Source: The Economic Times

NTPC takes over 2.3 GW power capacity in Rajasthan

January 12, 2017. NTPC will take over Chhabra Thermal Power Plant (1,000 MW) and Rajya Vidyut Utpadan Nigam (1,320 MW) in Rajasthan from Rajasthan Rajya Vidyut Utpadan Nigam and Rajasthan Urja Vikas Nigam respectively. To this effect the three entities signed memorandum of understanding for the takeover. NTPC is in discussions with Rajasthan Rajya Vidyut Utpadan Nigam to take over its entire generation capacities through joint ventures. The Rajasthan utility runs plants with a total capacity of about 5,000 MW.

Source: The Economic Times

All states except UP ink pact with centre to achieve round-the-clock power

January 11, 2017. All states barring Uttar Pradesh (UP) have inked agreements with the Centre to achieve the milestone of providing ’24×7 Power For All (PFA)’. The power ministry said it is the most significant milestone in this initiative founded on the principles of cooperative federalism. This milestone was achieved when the ministry signed the Memorandum of Understanding (MoU) for Ujwal Discom Assurance Yojana (UDAY) with Tamil Nadu. The ministry said that providing access to reliable and quality power supply to all citizens/establishments by 2019 is at the core of the Prime Minister Narendra Modi’s vision for the nation. The power ministry’s 24×7 program is aimed at delivering on it. The Program has been instrumental in mainstreaming the Ministry’s focus on energy efficiency and demand side management interventions and has resulted in increased participation with speedy rollout of the UJALA/ DELP and other EESL led schemes. UJALA has emerged as the world’s largest and most successful LED bulbs program, it said. Besides, development of segment wise coordinated physical rollout plans and rigorous analysis on financial viability of state utilities under the 24×7 PFA program in Rajasthan and Andhra Pradesh, the plans for which were made in first 100 days of coming of this government, led to the formulation of the UDAY, it said.

Source: The Economic Times


Solar energy can help in poverty alleviation: Goyal

January 17, 2017. Solar energy can help in poverty alleviation programmes as it can provide income to a large number of people having land but no income from it, Power, Coal, New and Renewable Energy and Mines Minister Piyush Goyal has said. The Minister is of the view that solar is an economically sound business proposition. The spread and success of the solar story will happen on its own merit. The whole world is conspiring to make this happen. Goyal said that the International Solar Alliance can play an important role as a catalyst to bring the recipients of technology and capital.

Source: The Indian Express

Expert bats for using solar power in cooking

January 17, 2017. Hundred units of fossil fuel is used to produce one unit of food – consumption of which leads to lifestyle diseases like cancer and diabetes. In contrast, one unit of solar energy can produce 100 units of food which is natural. This is what Vandana Shiva, renowned environmental activist and policy researcher, said. Shiva was one of the speakers at the inaugural day of the 6th Solar Cookers International World Conference which kicked off at Muni Seva Ashram at Goraj on the outskirts of the city. She said that fossil agriculture, in which artificial fertilizers are used, is highly inefficient. She said that increasing use of fossil fuels has resulted in migration of farmers to the city. Dr Janak Palta McGilligan, secretary of the conference, said that they will be sending their recommendations to the Union Ministry of New and Renewable Energy after the conference.

Source: The Times of India

SPML Infra bags new orders worth  8 bn for power substations, solar plants

January 17, 2017. SPML Infra Ltd said it has bagged new orders worth ₹ 800 crore for various projects including developing power substations. SPML Infra has received several new orders for developing power substation, rooftop solar power plant, water and wastewater treatment and municipal solid waste management projects from different states across the country, the company said. The order for solar power projects is in line with the company’s efforts to develop renewable energy source to meet many challenges facing the world with benefits to the people and the environment, the company said.

Source: The Economic Times

TRAI seeks industry feedback on tower emissions to cut carbon footprint

January 17, 2017. Telecom Regulatory Authority of India (TRAI) has floated a consultation paper seeking industry feedback on ways to compute carbon footprint in telecom networks, and the need to involve third-party auditors for running checks on such emissions in step with the government’s plans to ring in green phone networks. Carbon footprint is the extent of CO2 and other greenhouse gas emissions. In a paper issued, TRAI has estimated that carbon emission level from mobile operators has jumped by over 70% over the past two-three years, and in 2014-15 it was pegged at 58.3 million tonnes. The government’s green telecom policy unveiled nearly five years ago entails mobile carriers to migrate 50% and 20% of their cell towers in rural and urban areas, respectively, to hybrid power by December 2015, and as much as 75% and 33% by December 2020. Hybrid power is a mix of grid supplies and renewable energy based on solar, wind, biomass or fuel cells. In so far as carbon emissions go, telcos had been mandated by the telecom department to target 12% and 17% reductions by FY17 and FY19, respectively. In its consultation paper, the TRAI has also invited suggestions on suitable formulae to compute carbon footprint stemming from grid power supply and diesel gensets.

Source: The Economic Times

Railways on a ‘Mission 41K’ to save energy worth  410 bn

January 17, 2017. Railway Minister Suresh Prabhu unveiled ‘Mission 41K’ to save ₹ 41,000 crore on the Indian Railways’ expenditure on energy consumption over the next 10 years. This target will be achieved by taking a slew of measures which include moving 90 percent of traffic to electric traction over diesel. Presently, this is at 50 percent of the total rail traffic. The ministry plans to achieve this target by doubling the current pace of electrification, Railway said. The railways aim to procure more and more electricity at cheaper rates through open market instead of sourcing it through distribution companies and thereby hopes to save as much as 25 percent on its energy expenses. New technologies are being explored to bring down electric consumption. In the last Budget the railways have already set a target of generating 1000 MW of solar power and 200 MW of wind energy. Indian Railways consumed over 18.25 billion units of electrical energy for its traction and non-traction application during 2014-2015 for which it paid a total of ₹ 12,635 crore. For diesel traction it spent ₹ 18,586 crore in the same period.

Source: The Hindu Business Line

Bids for 750 MW Rewa solar tender may break  4 per unit barrier

January 16, 2017. Solar power tariffs are expected to fall substantially below ₹ 4 per unit in the bids for 750 MW Rewa solar project anticipates Bridge to India. Tariff of ₹ 4 per unit is the lowest till now for any utility scale project in India. According to the solar sector analysis firm, bids for the proposed and much delayed 750 MW solar power tender in the Rewa district of Madhya Pradesh are expected to be submitted early next week. The project is being tendered by Rewa Ultra Mega Solar (RUMS), a joint venture between Solar Energy Corp of India (SECI) and the Madhya Pradesh government. Developers can bid for three project units of 250 MW each in a solar park being developed by RUMS. Price bids are expected to break the ₹ 4 per unit tariff barrier because the tender offers large scale and enhanced bankability because power generated will be sold to Madhya Pradesh utilities and Delhi Metro Rail on an open access basis. According to Bridge to India the overall risk profile for Rewa tender is amongst the best in India and similar to projects tendered by National Thermal Power Corp (NTPC), which received the lowest-ever tariff bid in India of ₹ 4.34 per unit for a 70 MW project in Rajasthan in January 2016. The Rewa tender addresses two of the most critical risks for solar project developers in India – offtake and grid availability. If the tender results are as competitive as expected, it would provide a template for other states for solar power procurement.

Source: The Economic Times

India’s entry into NSG cannot be a farewell gift: China

January 16, 2017. Sticking to its stand, China said India’s entry into the Nuclear Suppliers Group (NSG) cannot be a “farewell gift” to the outgoing United States (US) President Barack Obama. The reaction by China, which has been consistently opposing India’s membership to the elite club, came after US Assistant Secretary of State for South and Central Asia Nisha Desai Biswal described China as an “outlier” in the process of letting India join the nuclear trade bloc. The US administration, under Obama, has strongly backed India’s membership in the 48-member NSG, which regulates global nuclear trade. China has opposed India’s entry into the grouping, which has been an irritant in Sino-India ties.

Source: Business Standard

Haryana to install 1 lakh solar lighting system

January 16, 2017. A new programme known as Manohar Jyoti will be implemented in Haryana to set up one lakh solar lighting systems in the state. To be launched in a phased manner by the Haryana Renewable Energy Department, the Ministry of New and Renewable Energy (MNRE) has sanctioned financial assistance of ₹ 23.65 crore to set up 21,000 solar lighting systems in its first phase. The MNRE had approved financial assistance of ₹ 45.89 crore so as to make available 3050 solar pumps to the farmers. The farmers were required to pay only ten percent amount to get the power pumps installed. The state government has made it mandatory to install solar power plants in different category of buildings. The MNRE has honoured Haryana in recognition of its achievement in the field of installing roof top solar power plants.

Source: India Today

Suzlon, Gamesa achieve milestones in wind-power capacity installation

January 16, 2017. At the end of one year and the beginning of another, wind turbine manufacturers Suzlon and Gamesa have crossed certain milestones. Suzlon said it had achieved 10,000 MW of wind power capacity installations in India. Gamesa, it is learnt, sold over 1,500 MW of turbines in calendar year 2016. Because a MW of capacity sells for ₹ 7 crore, Gamesa’s sales means that the company’s turnover in 2016 crossed the ₹ 10,000 crore mark. Suzlon has said that 35 percent of the wind turbines standing on Indian soil is its.  The company, only six-years-old in India, sold over 1,500 MW in 2016. Cumulatively, Gamesa has close to 4,000 MW of turbines in India. The company aims to raise its sales to 4,000 MW a year from 2020.

Source: The Hindu Business Line


25 states fail to meet solar capacity target this fiscal

January 16, 2017. With six years left for India to achieve its goal of generating 100 GW of electricity from solar projects, 25 states have fallen short of adding capacity by some 2,000 MW so far in 2016-17. The biggest laggards are Maharashtra, Uttar Pradesh, Haryana, Jharkhand, Odisha, J&K and West Bengal, each of them missing the mark by more than 100 MW. In terms of renewable power purchase obligations during 2015-16, only Andaman & Nicobar Islands, Meghalaya, Karnataka, Nagaland, Himachal Pradesh and Andhra Pradesh exceeded their targets, according to the government. Tamil Nadu, Maharashtra, Rajasthan, Gujarat, Haryana, Madhya Pradesh, Chhattisgarh and Punjab managed to meet about 60% of their obligation. The remainder achieved up to 59% of their targets, with Manipur and Goa not meeting any. Similarly, it is estimated that 22 states and UTs require over 9,080 MW of non-solar power capacity to fulfil their obligations to purchase energy from other renewable sources. Promotion of renewable generation sources has now been added as an objective of the new tariff policy. The policy has provisions such as 8% solar purchase obligations by 2022 and renewable energy generation obligation on new coal/lignite-based thermal plants. Fully depreciated power plants whose purchase obligations have expired can now bundle their output with renewable energy. Renewable energy has also been exempted from inter-state transmission charges.

Source: The Economic Times

BHEL commissions 500 MW thermal unit in West Bengal

January 16, 2017. Bharat Heavy Electricals Ltd (BHEL) has successfully commissioned another 500 MW thermal unit in the state of West Bengal. The unit was the second 500 MW set to be commissioned at Sagardighi Thermal Power Station (TPS) Phase II project in Murshidabad district of West Bengal. The first unit of the 1,000 MW project was commissioned earlier by BHEL in December, 2015. The project has been set up by the West Bengal Power Development Corp.

Source: Reuters

KNPP unit 2 touches 870 MW generation

January 15, 2017. The Unit 2 of Kudankulam Nuclear Power Plant (KNPP) reached a new power generation high on January 13. The unit began to generate 870 MW of its full capacity of 1000 MW. The unit 2 which was to be commissioned in 2008 attained criticality in July 2016 and has been generating power since. After more than a month after it attained criticality, the power generated in the unit was synchronized with the southern grid in August last year. Meanwhile, the maintenance of Unit 1 is underway and it is likely to attain criticality by the end of this month.

Source: The Times of India

Pathankayam hydel project ready for commissioning

January 15, 2017. The first small hydroelectric power project completed with the participation of a private agency on build-own-operate-and-transfer (BOOT) basis in north Kerala will be commissioned at Pathankayam in Kodenchery on January 17. Chief Minister Pinarayi Vijayan will inaugurate the project that can generate 8 MW power using water from the Iruvazhinji river. Mohammed Shafi, the managing director of Minar Renewable Energy Projects Pvt Ltd that was awarded the BOOT project by the government, said the work was completed within 17 months. The Kerala State Electricity Board and the Energy Management Centre extended technical support to help complete the undertaking on time, he said.

Source: The Hindu

Indian Army’s CME to save on power with solar plant

January 14, 2017. The Indian Army’s College of Military Engineering (CME) would install a solar power plant on its Dapodi campus to reduce its electricity bill — around ₹ 9 crore annually. CME authorities stressed the move would reduce 75% of the electricity expenses of the 35,000 acre campus, housing about 15,000 people. The ₹ 100 crore project was sanctioned by the government in the last financial year. The project has commenced and will be completed in three phases. The first phase is expected to be completed by the end of this year. The excess electricity will be passed on to the state electricity distribution company’s grid. The institute requires 3 MW electricity monthly. It costs around ₹ 75 to ₹ 80 lakh.

Source: The Times of India

More takers for solar water heaters in Kochi

January 13, 2017. In a bid to beat power crisis and to save electricity, demand for solar water heaters has increased in the district. The Agency for Non-conventional Energy and Rural Technology (ANERT), an organization for renewable energy projects, has been flooded with applications to avail subsidy for setting up the water heaters. The agency has stopped accepting further application this year as it met its district target within a month after inviting application. This year, it received 696 applications for availing subsidy of ₹ 34 lakh in a month. Last year, it had given subsidy on 621 applications for ₹ 28.72 lakh in two months. ANERT had started receiving application on December 5, 2016. The subsidy is given for two types of solar water heaters. The heater, which is set up on one msq area, will be given a subsidy of ₹ 3,000, while it is ₹ 4,000 for two msq. ANERT gives an average amount of ₹ 2,000 per msq area. As per the Kerala Solar Energy Policy of 2013, all individual residential buildings with 3,000 sq ft area should have solar water heaters. Besides residential buildings, hotels, government and private hospitals, resorts and other firms should set up solar water heaters.

Source: The Times of India

Hartek Power doubles solar capacity to 528 MW in this fiscal

January 13, 2017. Hartek Power has completed solar power projects of 270 MW spread across Punjab, Uttar Pradesh and Karnataka in the first three quarters of this fiscal, taking its total solar projects capacity under engineering, procurement and construction (EPC) contracts to 528 MW. The Chandigarh-based company undertakes EPC projects from independent power producers and specialises in grid connectivity. As of March 31, 2016, it had completed 258 MW of solar projects. The company has presence in 18 states for solar projects. It is focusing in South India and places like Jharkhand to consolidate its position. India’s installed solar generation capacity has increased four times to 10 GW from 2.5 GW in less than three years, offering huge opportunities for growth to companies like Hartek Power.

Source: The Economic Times

Solar-powered boat starts service in Kerala

January 13, 2017. Launching a solar-powered boat service at Vaikom in the district, Power, Coal, New and Renewable Energy and Mines Minister Piyush Goyal said the Centre would extend support to introduce more such boats in Kerala’s waters as it is keen to promote environment friendly projects. Goyal launched the service in Vaikom-Cherthala-Thavanakadavu waterways along with Chief Minister Pinarayi Vijayan. The first solar-powered boat was launched recently by Prime Minister Narendra Modi in Varanasi, Goyal said. Power production from solar energy that stood at 2000 MW in 2014 has gone up to 9500 MW at present, he said. The target was to take the production level to one lakh MW by 2020. Vijayan said the government is committed to strengthening water transport in the state. The solar-powered boat, introduced by the State Water Transport Corporation, can accommodate 75 passengers. The boat service would be from 7 AM to 7 PM evening, State Transport Minister A K Saseedharan said.

Source: The Economic Times

Centre moves SC against NGT ban on 10-year-old diesel vehicles

January 13, 2017. Challenging the ban on 10-year-old diesel vehicles, the Centre moved Supreme Court (SC) to appeal against the directive of the National Green Tribunal (NGT). Earlier in August, the top court had lifted the ban on registration of diesel vehicles above 2000cc in Delhi and NCR. It also noted that a 1 percent cess on ex-showroom price will be levied as green cess on such vehicles and the cess will likely be passed on to buyers. The court had said that the one percent green cess will be deposited before Central Pollution Control Board, which will open a separate account in a Public Sector Undertaking (PSU) bank. In 2015, the SC had temporarily banned the sale of large diesel vehicles in New Delhi, which had triggered strong protests from car manufacturers. The Central government had thrown its weight behind the auto industries, saying “diesel cannot be termed as an undesirable fuel.”

Source: The Indian Express

TPREL commissions two projects in Andhra Pradesh, Tamil Nadu

January 12, 2017. Tata Power Renewable Energy Ltd (TPREL), a renewable energy company and Tata Power’s wholly-owned subsidiary, announced the commissioning of 36 MW wind capacity of a 100 MW wind farm (under construction) at Nimbagallu in Andhra Pradesh, and 49 MW solar plant at Kayathar, Tamil Nadu, under Welspun Renewable Energy Private Ltd (WREPL). With these, the operating renewable energy capacity of TPREL grows to 1,876 MW, comprising 841 MW wind, 915 MW solar, and 120 MW waste heat recovery capacity as of today. In FY16, Tata Power Renewable Energy Ltd increased its operational capacity by 1169 MW. TPREL completed the acquisition of WREPL last year to become the largest Renewable Energy company in India. In 2016, TPREL has won 320 MW of solar bids, which are under development and will be commissioned in 2017. The company has also added 304 MW wind capacity in 2016, which are under development and construction in Gujarat, Andhra Pradesh, Madhya Pradesh and Karnataka.

Source: New Kerala

Suzlon bags 226.8 MW wind power project in Andhra Pradesh

January 11, 2017. Wind Turbine maker Suzlon Group said it won a 226.8 MW wind power project from an independent power producer (IPP) in Andhra Pradesh. Suzlon said it has entered into an exclusive Supply and Installation Agreement and Engineering and Construction of the project. Suzlon will be responsible for operation and maintenance services with dedicated life cycle asset management services for an initial period of 10 years, it said.

Source: Livemint


Brazil may hold second sub-salt oil licensing round this year

January 17, 2017. Brazil may hold a second licensing round this year for new oil exploration areas in an offshore region known as the sub-salt where massive discoveries have been made, the energy ministry said. Seeking to attract investment and avoid a third year of recession in 2017, the government was already planning one licensing round for sub-salt prospects to take place by the end of June. A second round could take place before the end of this year, the ministry said. Brazil’s government has said it expects to raise some 3 billion reais ($937 million) from the first sub-salt licensing round of this year. The areas on offer will include four blocks close to large existing oil discoveries near Rio de Janeiro.

Source: Reuters

Tullow finds oil in Kenyan Erut-1 well

January 17, 2017. Tullow Oil plc has announced that the Erut-1 well in Block 13T, Northern Kenya, has discovered oil. The well encountered a gross oil interval of 180 feet with 82 feet of net oil pay at a depth of 2,296 feet. The overall oil column for the field is considered to be between 328 and 410 feet. The objective of the well was to test a structural trap at the northern limit of the South Lokichar basin. Fluid samples taken, and wireline logging, all indicate the presence of recoverable oil, Tullow said.

Source: Rigzone

Operations at Venezuelan oil terminal halted by spill

January 17, 2017. Shipping operations at one of three docks of Venezuela’s main crude exporting port were halted after an oil spill occurred while loading a vessel bound for India. The spill, which happened over the weekend at Jose port’s Eastern dock and whose size has not yet been disclosed, also affected other tankers close to the very large crude carrier (VLCC) Nave Quasar, chartered by India’s Reliance Industries. Venezuelan state oil company PDVSA, which operates the terminal, did not immediately respond to a request for comment. Jose is Venezuela’s largest crude port. Most crude shipments are made from there due to its capacity to load Suezmaxes and VLCCs. The port also receives imports of diluents for PDVSA’s extra heavy oil output, such as light crude and naphtha.

Source: Reuters

Africa Oil makes oil discovery on Erut prospect in Kenya

January 17, 2017. Africa Oil announced that the Erut-1 well in Block 13T, Northern Kenya, has discovered a gross oil interval of 55m with 25m of net oil pay at a depth of 700m. The overall oil column for the field is between 100 and 125 meters. Potential exists for additional pay but will need to be confirmed by laboratory analysis.

Source: Energy Business Review

China’s crude oil output will fall 7 percent by 2020: Govt

January 17, 2017. China’s crude oil output is expected to drop by 7 percent by 2020 compared with the previous five-year plan as output from some of the nation’s largest, but oldest, wells falls, while natural gas supplies will rocket by almost two-thirds. Under a plan covering the period 2016-2020 published by the National Development and Reform Commission (NDRC), crude output will be around 200 million tonnes by 2020, equivalent to 4 million barrels per day (bpd). That would be down from 215 million tonnes in the 2011-2015 plan. The drop reflects falling output at aging, high-cost fields as producers scale back production in a lower oil price environment. For the first 11 months of 2016, production was down 6.9 percent at 182.91 million tonnes, just under 4 million bpd. Consultancy Wood Mackenzie forecasts a decline of nearly 500,000 bpd in Chinese crude oil production over the next four years at 3.5 million to 3.6 million bpd. Meanwhile, the NDRC said natural gas supply would be 220 billion cubic metres (bcm) by 2020, compared with 134 bcm under the 2012-2015 five-year plan as Beijing prioritises the sector’s growth. The government is maintaining an earlier target for shale gas output at 30 bcm, or 13.6 percent of the total. In the oil sector, pipeline capacity will be around 650 million tonnes for crude – equivalent to 13.1 million barrels per day – and 300 million tonnes for refined products by 2020. China will also further improve fuel quality to cut emissions, aiming to roll out the “national six” grade for gasoline and diesel from 2019, after implementing “national five” specifications from this year.

Source: Reuters

Mexico’s Pemex imports first diesel cargo via train from US

January 17, 2017. Mexico’s state oil company Pemex began receiving imported fuel by train at a new privately run terminal for the first time in January as companies expand storage and transportation operations under the country’s energy opening. The cargo of just under 60,000 barrels arrived from Port Arthur, Texas, at the new private San Jose Iturbide storage terminal in central Guanajuato state via train, marking another first for the company which normally uses pipelines and seaports for fuel imports. Isaac Volin, head of Pemex’s trading arm PMI Comercial Internacional, said the initial cargo was used to test the new process, but he expects similar diesel cargos to supply the terminal via rail about every eight days. The new stream of imported fuel will help Pemex supply the Mexican capital and several central Mexican states, some of which were hit by sporadic shortages in recent weeks. Volin said gasoline imports via rail should get started in “a few weeks” with planned cargos of 75,000 barrels arriving about once a week at the San Jose Iturbide terminal, which is located about 160 miles (260 km) northwest of Mexico City. The terminal is owned by Grupo Simsa, a Mexican conglomerate that transports fuels with its fleet of trucks, and is operated by United States (US) company Howard Energy Partners. It features total storage capacity for 65,000 barrels of diesel and 75,000 barrels of gasoline.

Source: Reuters

US shale oil output set to grow in February as prices rise

January 17, 2017. The United States (US) shale production is set to snap a three-month decline in February, the US government said, as energy firms boost drilling activity with crude prices hovering near 18-month highs. The month-on-month increase in production would be the first since October and the third rise in a year, according to the US Energy Information Administration (EIA)’s drilling productivity report. February production will edge up 40,750 barrels per day (bpd) to 4.748 million bpd, the EIA said. In January, it was expected to drop by 5,900 bpd.

Source: Reuters

Oil, gas discovery in Norwegian Sea: Eni

January 17, 2017. Eni S.p.A. announced that a new oil and gas discovery has been made within the PL128/128D licenses in the Norwegian Sea. The discovery was made through well 6608/10-17S, which encountered 91 feet of oil and gas with good reservoir properties in the Cretaceous sandstones of the Cape Vulture prospect. A preliminary estimate of the size of the discovery ranges between 70 and 200 million barrels of oil in place, with a further additional potential to be evaluated.

Source: Rigzone

Asian oil refinery margins jump on outages in Mideast, Asia

January 17, 2017. Several refineries in the Middle East and Asia have shut down in the past week due to fires and other technical problems, leading to a jump in profit margins for facilities still operating. The higher Asian refining margins have beat back concerns that profits would fall as crude oil prices gained as the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers began to implement their agreed production cuts from January to reduce global oversupply. Besides the fires and other shutdowns, maintenance and repairs at refineries in Indonesia by Pertamina and in Singapore by Royal Dutch Shell have further boosted oil product margins. Operators that had to shut fire-hit or other units include the Abu Dhabi National Oil Company and Russia’s Rosneft, as well as India’s Hindustan Petroleum Corp Ltd and Bharat Petroleum Corp Ltd.

Source: Reuters

Iranian Oil Minister certain that oil prices will rise

January 16, 2017. Iran’s Oil Minister Bijan Namdar Zanganeh said that he was confident the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC members would commit to the output cut deal agreed in November, noting that prices of oil would rise further as a result. OPEC agreed to cut output by 1.2 million barrels per day (bpd) to 32.5 million bpd for the first six months of 2017, in addition to 558,000 bpd of cuts agreed to by independent producers such as Russia, Oman and Mexico.

Source: Reuters

Oil prices will be much more volatile in 2017: IEA

January 15, 2017. Global oil prices will witness “much more volatility” in 2017 even though markets may rebalance in the first half of the year if output cuts pledged by producers are implemented, the International Energy Agency (IEA) said. The Organization of the Petroleum Exporting Countries (OPEC) agreed to cut output by 1.2 million bpd to 32.5 million bpd for the first six months of 2017, in addition to 558,000 bpd of cuts agreed by independent producers such as Russia, Oman and Mexico. IEA said that a recent trend of declining Chinese oil production due to low prices could be reversed if the market strengthened.

Source: Reuters

Venezuela will circulate new proposal to support oil prices

January 15, 2017. Venezuela will circulate a new proposal to crude producers in a bid to support oil prices, President Nicolas Maduro said. The Organization of the Petroleum Exporting Countries agreed to cut output by 1.2 million barrels per day to 32.5 million bpd for the first six months of 2017, in addition to 558,000 bpd of cuts agreed to by independent producers such as Russia, Oman and Mexico. Venezuela has long pushed for high prices of oil, which accounts for over 90 percent of its export income amid a brutal recession.

Source: Reuters

US pipeline regulator completes rule to boost safety standards

January 13, 2017. The United States (US) Pipeline and Hazardous Materials Safety Administration (PHMSA) said it has passed a rule to boost safety requirements on the country’s oil and refined products pipelines. The rule requires pipeline operators to have a system for detecting leaks and to establish a timeline for inspecting affected pipelines following an extreme weather event or natural disaster, PHMSA said. Pipeline safety has become a key topic of debate in recent months after massive protests against Energy Transfer Partners’ crude oil Dakota Access Pipeline due to concerns about contaminated water supply in the event of a leak. The incoming Donald Trump administration has said it supports Dakota Access, along with other pipeline projects.

Source: Reuters

North Dakota oil output seen below 1 mn bpd soon

January 13, 2017. North Dakota’s oil production will likely fall below 1 million barrels per day (bpd) by the end of January due to harsh winter weather and low oil prices, state regulators said. The state’s Bakken oil formation has higher operating expenses than parts of Texas, for instance, due to its remoteness and lack of physical infrastructure. North Dakota must contend with winter blizzards that southern oil-producing states lack, further threatening output. Already this winter, North Dakota has had three major blizzards, a sharp increase from recent years. North Dakota pumped 1,033,693 bpd in November, down from 1,043,693 bpd in October, according to data from the North Dakota Department of Mineral Resources, which reports on a two-month lag.

Source: Reuters

Iraq wants crude price around $65 a barrel: Oil Minister

January 12, 2017. Iraq is abiding by an agreement among global oil producers to cut production and wants to see an oil price of around $65 a barrel, the Oil Minister Jabar Ali al-Luaibi said. Iraq is “hoping for a better price”, Luaibi said. Brent crude is now around $55 a barrel. The Iraqi oil ministry said that it had cut its production by 160,000 barrels per day (bpd) since the beginning of January. By the end of the month, production would be cut by 210,000 bpd, it said. Luaibi said that Iraq had reduced exports by 170,000 bpd and was cutting them by a further 40,000 bpd.

Source: NDTV

Hess to spend more on E&P this year

January 12, 2017. Hess Corp said it expected to spend $2.25 billion on exploration and production (E&P) this year, higher than the $1.9 billion it spent in 2016, in one of the first signs that oil firms will raise their budgets in 2017 after years of declines. Global oil and gas companies are expected to raise exploration and production (E&P) spending in 2017 by 7 percent, Barclays said. Oil prices are recovering after a more than two-year slump, partly due to an agreement OPEC signed in November to curb supply. Hess said its budget would go toward deploying additional rigs in North Dakota’s Bakken field, developing a field in Guyana and restarting drilling at the Valhall Field in Norway.

Source: Reuters

Saudi Energy Minister expects tight oil market in 2 to 3 yrs

January 12, 2017. Saudi Arabian Energy Minister Khalid al-Falih said that he expected tightness in the global oil market in two or three years. Falih predicted global demand for oil would grow by well over 1 million barrels per day in 2017. The oil market has been moving toward a balance of supply and demand and December’s agreement by Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers to cut output will accelerate that process, he said. The deal is for six months and producers will consider later whether to renew it, he said.

Source: Reuters

China’s oil refining capacity will rise 4.6 percent in 2017

January 12, 2017. China’s total refining capacity will increase 4.6 percent to 790 million tonnes in 2017 and net crude oil imports will rise 5.3 percent to 396 million tonnes, China National Petroleum Corp (CNPC) forecast. In an annual report released by CNPC’s research institute, it forecast net exports of diesel will grow 55 percent to 22.41 million tonnes.

Source: Reuters


California moves toward reopening Aliso Canyon gas storage field

January 17, 2017. California regulators took a step toward reopening the Aliso Canyon natural gas storage facility after a major methane leak in 2015 forced the evacuation of thousands of nearby residents, but new injections will not be authorized until the public has the chance to weigh in. Under the state’s proposal, the amount of natural gas Southern California Gas would be able to store in the Los Angeles-area field would be limited to about one third of its capacity.

Source: Reuters

Ukraine has to pay $5.3 bn for unused gas in 2016: Russia’s Gazprom

January 17, 2017. Russian gas giant Gazprom said it had charged Ukrainian energy firm Naftogaz with a $5.3 billion bill for gas it did not buy under a take-or-pay clause. Gazprom said the bill related to supplies in the second to fourth quarters of last year and that Ukraine had to pay the bill within 10 days. Ukraine has not bought Russian gas since November 2015. Take-or-pay requirements make consumers pay for gas whether they take physical delivery or not.

Source: Reuters

PetroVietnam, Exxon Mobil sign deal on gas generation

January 13, 2017. State energy group PetroVietnam (PVN) signed an agreement with the Vietnamese unit of US Exxon Mobil Corp to develop the country’s biggest gas project for power generation, the state firm said. The Blue Whale project aims to produce the first gas for power plants by 2023. PVN said the project would contribute nearly $20 billion to the state budget, but it gave no timeframe for that contribution. Blue Whale is Vietnam’s biggest gas project with an estimated 150 billion cubic meters of reserves.

Source: Reuters

Gas output down 2.7 percent in 2016: Russia’s Novatek

January 13, 2017. Russia’s No.2 natural gas producer Novatek said its gas output declined by 2.7 percent in 2016, while gas condensate and oil production jumped by almost 37 percent as it commissioned new fields. Novatek’s natural gas output declined to 66.10 billion cubic metres last year. Production of gas condensate and crude oil, classified as “liquids”, rose to 12.44 million tonnes, helping Russia’s overall oil output reach a new post-Soviet high of 10.96 million barrels per day last year. Novatek had planned to keep natural gas production flat in 2016 while targeting a 30 percent rise in output of crude oil and gas condensate. For 2017, it expects a small decline in gas output.

Source: Reuters

Thailand’s PTT picks Marubeni-Itochu venture to supply natural gas pipeline

January 12, 2017. Thailand’s largest energy firm PTT Pcl has chosen a Marubeni and Itochu joint venture to supply a natural gas pipeline, the Thai company said. Marubeni-Itochu, a joint venture between Japanese companies Marubeni and Itochu, won bids to supply state-controlled PTT with its fifth natural gas pipeline, Chavalit Punthong, Chief Operation Officer, Infrastructure and Sustainability Management Group, said. He said the pipeline will stretch 430 kilometres (267 miles) from Rayong to Nonthaburi, just north of the capital Bangkok. The pipeline project is expected to cost 99 billion baht ($2.8 billion) and will be completed by 2020.

Source: Reuters

Argentina’s Vaca Muerta shale may not be developed until oil prices rise

January 11, 2017. Argentina made a move to lower its high labor costs with a deal to reduce benefits for workers in the country’s immense Vaca Muerta shale oil formation, but the resource may remain largely untapped until world oil prices recover further Vaca Muerta is a shale gas and oil formation the size of Belgium in the heart of the region of Patagonia and is essential to Argentina being able to become self-sufficient in energy. President Mauricio Macri hopes a pact he has negotiated with unions and provincial authorities will jumpstart investor interest in developing the field. The government trumpeted signs this is already happening with $5 billion in planned 2017 investments from major oil companies including $2.3 billion from the state-owned YPF SA. Argentina will offer a subsidized price of $7.50 per million British thermal units of natural gas produced at new wells through 2020. The price is more than double that of front-month natural gas futures on the New York Mercantile Exchange.

Source: Reuters


US coal miner Peabody secures $1.5 bn in loans to exit bankruptcy

January 16, 2017. Peabody Energy, the largest coal producer in the United States (US), has secured $1.5 bn in financing from a group of banks including Goldman Sachs and JPMorgan Chase to exit bankruptcy in the coming months. The group filed for bankruptcy protection for the majority of its US entities in April 2016, due to falling prices. Peabody owns stakes in 26 mines in the US and Australia, with about 3/4 of its production sold to the US power sector, that is increasingly shifting toward gas-fired generation.

Source: Enerdata

China halts over 100 coal-fired power projects

January 16, 2017. China’s energy regulator has ordered 11 provinces to stop more than 100 coal-fired power projects, some of which are under construction, with a combined installed capacity of more than 100 GW. The National Energy Administration (NEA) suspended coal projects already under construction in some provinces and autonomous regions including Xinjiang, Inner Mongolia, Shanxi, Gansu, Ningxia, Qinghai, Shaanxi and other northwestern regions. About 430 billion yuan ($62.30 billion) was invested in these projects. In October, the NEA said it would postpone construction of some coal-fired plants that already had approvals.

Source: Reuters

China’s 2016 coal imports jump 25 percent

January 12, 2017. China’s coal imports dipped slightly in December from the previous month but were still up more than 50 percent from a year ago at 26.84 million tonnes, customs data showed. For 2016, China’s coal imports rose 25.2 percent from a year earlier to 255.5 million tonnes, reflecting China’s campaign to reduce overcapacity in the domestic coal sector. Analysts have forecast that the pace of coal imports could slow in 2017 as the restart of domestic coal mines dampens demand for imports. China’s efforts to clean up overcapacity unexpectedly triggered a rally in domestic coal prices as well as international coal prices.

Source: Reuters


ITC secures US DOE presidential permit for 1 GW Lake Erie transmission project

January 16, 2017. ITC Lake Erie Connector, a wholly-owned subsidiary of United States (US) power transmission firm ITC Holdings, has secured presidential permit from the US Department of Energy (DOE) for the planned 1,000 MW ITC Lake Erie Connector transmission project. The proposed connector will be a +/- 320kV bi-directional, high-voltage direct current merchant transmission line. It will be the first direct link connecting the markets of the Ontario Independent Electricity System Operator and PJM Interconnection, a regional transmission organization in the US.

Source: Energy Business Review

Greek banks concerned over PPC’s power grid spin-off scheme

January 13, 2017. Greece’s four biggest lenders are concerned about the spin-off of the country’s power grid operator ADMIE, a key condition of a bailout agreement between Athens and its official creditors. ADMIE is fully owned by Greece’s state-controlled electricity utility Public Power Corp (PPC). Under a legislated scheme, PPC will sell a 24 percent stake in ADMIE to China’s State Grid for € 320 million ($340 million) and transfer another 51 percent stake to the state and its current private shareholders for free. But banks which have extended sizeable loans to PPC sent a letter to the finance ministry, expressing worries over the plan. Finance Minister Euclid Tsakalotos and Energy Minister George Stathakis met executives of the four big banks to discuss the successful completion of the power grid spin-off, the finance ministry said.

Source: Reuters


Oil majors, car makers to push hydrogen technology to help cut emissions

January 17, 2017. The heads of some of the world’s biggest oil firms and automakers agreed to push for broader global use and bigger investments in using hydrogen to help reduce emissions and arrest global warming. The oil firms’ and car makers’ chiefs said the plan was part of global efforts to keep global warming well below 2 degrees Celsius, an ambitious goal agreed by 195 countries in Paris in 2015. The declaration was also signed by the chief executive officers (CEOs) of car makers BMW, Daimler, Honda, Hyundai, Kawasaki and Toyota as well as miner Anglo American and energy and engineering firms Engie, Linde and Air Liquide. Hydrogen does not release any CO2 at the point of use and its technologies and products have progressed significantly, the firms said. They aim to accelerate investment in developing and commercializing the hydrogen sector, currently amounting to just € 1.4 billion a year – compared with the hundreds of billions of dollars invested annually by the oil sector.

Source: Reuters

Saudi to launch $30-50 bn renewable energy program soon: Energy Minister

January 16, 2017. Saudi Arabia will launch in coming weeks a renewable energy program that is expected to involve investment of between $30 billion and $50 billion by 2023, Saudi Energy Minister Khalid al-Falih said. Falih said Riyadh would in the next few weeks start the first round of bidding for projects under the program, which would produce 10 GW of power.

Source: Reuters

TEPCO should remain state-run for at least 3 yrs

January 16, 2017. Japanese power utility Tokyo Electric Power Company (TEPCO) could remain under the control of the government for at least three additional years (until 2020) due to the Fukushima disaster burden on the company’s finances. TEPCO plans to merge its nuclear and power distribution operations with other companies, but the process remains unclear.

Source: Enerdata

ADFD to fund $44.5 mn to four renewable energy projects in Pacific and Africa regions

January 14, 2017. Abu Dhabi Fund for Development (ADFD) and the International Renewable Energy Agency (IRENA) have identified four renewable energy projects in developing countries in the Pacific and Africa to grant $44.5 mn in funding.

Source: Energy Business Review

Taiwan amends its Electricity Act, plans nuclear exit by 2025

January 13, 2017. Taiwan lawmakers have approved draft amendments to the Electricity Act, which will introduce the first change in the law for five decades. Under the draft Electricity Act, all nuclear power plants will have to stop operations by 2025. By 2025, the monopoly of Taiwan Power Company will be removed, the company will be privatised between 2023 and 2026 and a holding company will be set up and split into a generation company and a distribution company.

Source: Enerdata

New York seeks to develop US’s biggest offshore wind projects

January 12, 2017. New York Governor Andrew Cuomo proposed to develop up to 2,400 MW of offshore wind power by 2030 capable of powering 1.25 million homes as the state seeks to lead the nation in renewable energy production. The offshore wind proposal came after the Governor said that Entergy Corp’s 2,069 MW Indian Point nuclear power plant in Westchester County would shut by 2021 and the state planned to replace its power output with renewable and low carbon energy sources.

Source: Reuters


State-wise Free Electricity Connections to BPL Households

As on Oct 31, 2016

State % of BPL households with free Electricity Connections
Bihar 15.1
Odisha 11.1
Andhra Pradesh 9.7
West Bengal 8.8
Uttar Pradesh 7.6
Madhya Pradesh 6.7
Jharkhand 5.1
Maharashtra 4.9
Assam 4.8
Rajasthan 4.7
Chhattisgarh 4.6
Karnataka 3.8
Gujarat 3.4
Telangana 2.8
Tamil Nadu 2.0
Uttarakhand 1.0
Haryana 0.8
Kerala 0.6
Tripura 0.6
Meghalaya 0.4
Punjab 0.4
Manipur 0.3
J & K 0.3
Nagaland 0.2
Arunachal Pradesh 0.2
Mizoram 0.1
Himachal Pradesh 0.1
Sikkim 0.1
Total 2,49,89,940

Source: Rajya Sabha, Unstarred Question No.1368 for Ministry of Power


Publisher: Baljit Kapoor
Editorial advisor: Lydia Powell
Editor: Akhilesh Sati
Content development: Vinod Kumar Tomar

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