MonitorsPublished on Dec 17, 2018
Energy News Monitor | Volume XV; Issue 27


Power News Commentary: November - December 2018


Trade volumes rose 19 percent at the IEX in the first six months of this financial year. This was aided by a pan-India 6.2 percent increase in electricity generation during the period. In all, 28,584 million units of power were traded between 1 April and 30 September, counting both the day-ahead and term-ahead markets. Total volume trade on IEX went up 34 percent, to 33,705 million units in the period. During the period, the market was congestion-free on most days. Volume curtailment due to congestion was only 0.6 percent.

Buoyed by a good response for the first tender of mid-term (3 years) PPA auction, the power ministry will bring its second round for 2,500 MW capacities to give relief to stressed power assets. A PPA is a prerequisite for getting coal supplies for power plants. Power sector is facing stress due to coal shortage and other issues. Many power projects are starving for coal in the absence of PPAs. The government's scheme to auction 2,500 MW medium-term PPAs evoked good response and PPAs for 1,900 MW capacities were signed under the scheme last month. The power ministry in April 2018 had issued guidelines for a pilot scheme to facilitate aggregation of procurement of power (2,500 MW for 3 years) from commissioned coal-based power plants through competitive bidding. The power procuring distribution companies were Telangana and Tamil Nadu for 550 MW each, West Bengal and Bihar for 200 MW each. Haryana consented to sign for 400 MW.

Led by revival in electricity demand, Vedanta recorded a 19 percent rise in its commercial power sales during July-September quarter. Total power sales from all generating units during the period stood at 3,514 million units as against 2,950 million units in the comparable period of last fiscal year. Vedanta’s coal-fired generating unit at Jharsuguda of 600 MW and HZL unit were the key drivers of power sales. The Jharsuguda power station logged 35 percent year-on-year growth in power sales in Q2FY19 after a tepid performance in the last fiscal year. HZL’s power sales were up 29 percent in the period under review, according to an investor presentation by Vedanta. Total power generation capacity by Vedanta-owned units stands at 9,000 MW. Of this, 5,100 MW is meant for captive consumption and the rest for commercial sales.

Residents and commercial establishments, particularly those in rural areas across the state, will have to pay higher electricity bills from next year if a proposal as per the ARR petition of the Jharkhand Bijli Vitaran Nigam Ltd, the state owned power distribution company, is passed next year. The last time power tariffs were hiked was on 1 May, this year. As per the ARR petition, power tariffs for Kutir Jyoti or tribal beneficiaries below poverty line presently being fixed at Rs 4.40/kWh has been proposed to be hiked to Rs 6 /kWh, a jump of over 36 percent. Similarly fixed charges now at Rs 20/month has been proposed to be hiked to Rs 75/month. For other rural consumers, power tariff has been proposed to be hiked from the present Rs 4.75/kWh and a fixed charge of Rs 35/month, to Rs 6//kWh, with an enhanced fixed charge of Rs 75/month. For urban domestic consumers, the present tariff of Rs 5.50 /kWh has been proposed to be hiked to Rs 6.00 /kWh with no change in fixed charge of Rs 75 /month. Similarly for commercial establishments located in rural areas, the power tariff, standing at Rs 5.25 /kWh and a fixed charge of Rs 60 has been proposed to be hiked to Rs 7 /kWh and a fixed charge of Rs 225/month. For commercial establishments located in urban areas, the present tariff of Rs 6.00/kWh has been proposed to be hiked to Rs 7.00 /kWh with no change in fixed charge of Rs 225/month.

Uttar Haryana Bijli Vitran Nigam said that they would provide a list of electricity defaulters to village Sarpanches and zila parishad members, as part of a new campaign to be launched in Jind district. He said that nearly Rs 15 bn is pending from unpaid electricity bills by more than 100,000 consumers in the district. Consumers can take advantage of the Bijli Niptan Yojna and pay in instalments and that interest on the pending bill would be waived off. The deadline for the scheme is 31 December. The government's focus is on providing electricity connection to every household in the country under the Saubhagya scheme instead of achieving a set of numbers. It is said that household electrification has led to an increase in aggregate, technical and commercial losses of power distribution utilities. 21 million households have already connected and eight states have achieved 100 percent saturation (in household electrification)-- Madhya Pradesh, Tripura, Bihar, Jammu & Kashmir, Mizoram, Sikkim, Telangana and West Bengal.  States that are close to achieving 100 percent household electrification are Maharashtra, Uttrakhand, Himachal Pradesh, Arunachal Pradesh and Chhattisgarh. Some states were already 100 percent electrified, inlcuding Gujarat, Goa, Andhra Pradesh, Tamil Nadu, Kerala, Punjab and the Union Territories.

In a relief to power consumers ahead of the general elections 2019, power discoms in Andhra Pradesh made it clear that there will be no increase in electricity tariff for the next year financial year 2019-20. Farmers will get seven hours of free power supply a day. The no-hike proposal comes in the wake of assurance by the state government that it will bear the additional financial burden in the form of subsidy to discoms. Charging stations for electric vehicles will get power at a reduced tariff.

Delhi BSES discoms expect peak hour electricity demand to scale upto 4,800 MW this winter and plan to buy short-term power from spot market in case of contingency. The discoms will resort to electricity banking and backdown techniques to dispose surplus electricity. Last year, winter electricity demand had peaked at 4511 MW. The peak winter power demand in BRPL and BYPL areas had reached 1,888 MW and 1,136 MW, respectively, during last winter. This year, it is expected to reach 1,950 MW and 1,225 MW for BRPL and BYPL respectively, it said. BSES discoms will bank surplus power with hilly states, which need additional power during the winter months. This banked power will be available during the summer months. BRPL will bank between 300-400 MW with states like Himachal Pradesh, Meghalaya, Manipur and Jammu and Kashmir. BYPL will return around 200 MW to states like Himachal Pradesh, from whom it had taken the quantum during the summer-months.

Just three months after it began operations, Adani Energy is drawing flak from consumers whose bills have shot up to unprecedented levels. Some consumers claim their bills for September and October have shot up by as much as 100 percent. Previously known as Reliance Energy, the Mumbai distribution company of Reliance Infrastructure, was acquired by the Adani Group earlier this year. The distribution company has been maintaining that the spike in bills was caused by a change in the weather condition, which in turn reportedly led to a change in the consumption pattern. According to consumer groups and analysts, an average tariff hike approved ranges from 2-8 percent depending on the distribution circle as well as the consumer category. However, the hike could be even more pronounced after April 2020. The protests has prompted Adani Electricity to set up a 24x7 helpline that has promised a response to all the queries related to billing within 24 hours. The company has also organised several camps to respond to queries related to billing.

The Uttar Pradesh Cabinet approved selection of Adani Transmission and Power Grid Corp for setting up transmission networks for evacuation of power from two thermal power projects —2×660 MW Obra-C project and 2×660 MW Jawaharpur project. Both these projects, which have been awarded through the tariff-based competitive bidding process, will bring an investment of Rs 14 bn in the state. Both the transmission projects are being primarily constructed to establish transmission system for evacuation of power from the projects once they are ready. Two 400 kV sub-stations are also being built. While the Obra-C project will also involve setting up of a 400 kV sub-station in Badaun, the Jawaharpur project will have a 400 kV sub-station in Firozabad.

The World Bank will extend $310 million loan for Jharkhand Power System Improvement Project to provide reliable, quality, and affordable 24x7 electricity in the state. An agreement in this regard was signed between the Centre, Jharkhand government and World Bank. The project will help bring in modern technology solutions such as automated sub-stations, and network analysis and planning tools to provide reliable power supply and enhance customer satisfaction. The project is part of the government's power for all programme launched in 2014. The plan envisages addition of over 4.5 GW generation capacities by 2022 through a mix of private and public-sector investments. As per data from Jharkhand Distribution Company, more than 80 percent of people in the state have access to electricity. The per capita consumption of electricity in Jharkhand at 552 kilowatt hour at the end of 2015-16 is roughly half of the national average.

The PSPCL earned Rs 9.75 bn up to 31 October this fiscal by selling over 1,800 million units of surplus power to discoms of other states. The additional revenue may have come as a relief for the power discom as the state government is yet to pay for subsidies offered to various categories of consumers. The PSPCL is also yet to get a payment of over Rs 12 bn for outstanding power bills of various government departments. The power corporation sold the surplus power at an average cost of Rs 5.4 /kWh in the open exchange from June to October. However, with fall in prices at the open exchange, the corporation has switched to power-banking arrangements to bring down fixed charges that it has to pay for installed power-generation capacity of IPPs. Under power banking, a state’s discom supplies power to the power company of another state free of cost and then takes free supply from that company during its peak season. Power demand had dropped to 5,000 MW during the day and 3,000 MW during the night in Punjab. The demand in peak month, June, was 13,000 MW. The PSPCL has to buy power from IPPs or pay them fixed charges against the installed capacity. At present, it is selling 1,600 MW of surplus power to Andhra Pradesh, Maharashtra, Uttarakhand, and Jammu and Kashmir to topple the fall in power prices in the open exchange.

Rest of the World

French independent power vendors association ANODE is considering making a legal challenge to a government freeze on state-owned EDF’s electricity prices, it said. ANODE president Fabien Chone said the proposed freeze on EDF’s regulated tariffs threatens the survival of some of its members. These operators all compete against EDF, which has an 80 percent share of the retail power market. The government should lower power taxes or introduce support measures for ANODE’s members, it said. From 15 December to 1 March the government would organize a nationwide debate on energy and that power and gas prices would not increase in the meantime. Retail services specialist Colombus Consulting expects French power prices to rise by between 2 percent and 8 percent next year. Even at 5 percent, it would be the highest increase in years.

A nationwide strike reduced French electricity production by 5.5 GW, mostly at state-controlled utility EDF’s nuclear, coal and hydro power plants, power grid operator RTE said. The energy branch of France’s CGT union had called the strike in protest over stalled wage negotiations and a possible government-led restructuring of EDF. The RTE said electricity generation was reduced at EDF-operated Paluel 1, Chinon 1 and St. Laurent 1 nuclear reactors. Power output had also been reduced to zero at EDF’s Cordemais 4 and 5 coal-fired plants, while an ongoing strike at the Havre 4 coal power plant that began on 27 October was extended by 24 hours until 14 November, the RTE said. Electricity generation was reduced by around 1,950 MW at EDF’s hydro power stations across France, the RTE said.

An unspecified number of power stations in Germany will be shut down by 2022 in agreement with their operators, according to a draft document from a government commission tasked with creating a roadmap for phasing out coal. The document said agreement with the operators should happen on the basis of contracts which include rules for possible compensation for operators. It said finances needed to be set aside for the recommended measures and there would not be a levy on the electricity price.

Britain must halt a back-up power scheme aimed at avoiding electricity shortages pending a further investigation by EU regulators, an EU court ruled, which sent shares in UK energy companies tumbling. The judgment by the EU’s General Court annuls a decision by the European Commission, which had said Britain’s so-called power capacity market was compatible with EU state aid rules. Britain began power capacity auctions in 2014, offering to pay providers for making supplies available at short notice, and so avoid shortages that might occur as coal plants close and low prices dissuade investors from building new power plants. National Grid said it has been asked to postpone indefinitely upcoming auctions for capacity to be delivered in the winter of 2022/23 and a nearer-term one for 2019/20.

Russia may delay until March the official launch of its power stations in Crimea, the stations’ engineering firm said, the latest hitch to the plants where Russia is accused of installing German-designed electricity turbines in contravention of sanctions. Russia began building two power stations on Crimea to provide electricity to the peninsula which it annexed from Ukraine in 2014, but the facilities became embroiled in a row over sanctions. The company, Tekhnopromeksport, said the first stage of the power stations will be ready by the end of this year, but that it had requested that the launch of the second phase be delayed until to March.

South Africa faces more power cuts, electricity utility Eskom warned as it sought to prevent the collapse of its power grid in a test for reforms. Eskom implemented a fifth day of controlled power cuts, putting more strain on an economy already mired in recession only months before a national election. Eskom, which is battling a severe financial crisis, coal shortages and breakdowns of its power plants, said it would cut up to 2,000 MW power from the grid. Reforming Eskom has been hampered by fiscal constraints in a blow to the plan to woo investors who can help grow the economy ahead of an election likely to be held in May next year. Prolonged power cuts would likely hurt economic growth in the first quarter of 2019, although a slowdown in manufacturing over the Christmas period will buy Eskom some time.

South African power utility Eskom cut 1,000 MW of electricity from the strained national power grid after high unplanned outages, the company said. Eskom had implemented stage 1 controlled power cuts that shed up to 1,000 MW from the grid. The power cuts are implemented to prevent the grid from being overwhelmed after unplanned outages. Eskom, which supplies more than 90 percent of South Africa’s power, warned of potential outages amid low coal inventories after a major supplier cut supplies and sought insolvency protection.

Power-hungry Vietnam, one of Asia’s fastest-growing economies and a production hub for global companies such as Samsung Electronics, needs to raise up to $150 billion by 2030 to develop its energy sector, according to World Bank. Vietnam has been struggling to develop its energy industry due to a lack of state funds. The Southeast Asian country’s hydropower potential has almost been fully exploited, oil and gas reserves are running low, and Vietnam recently went from a net exporter to net importer of coal. Electricity demand in Vietnam will grow by about 8 percent a year for the next decade. Vietnam plans to more than triple the amount of electricity it produces from renewable sources and push for a 26 percent increase in household solar energy usage by 2030. Vietnam has not been able to reduce its reliance on coal energy, which will account for 53 percent of all energy generated in the country by 2030, according to its trade ministry.

Niger is on track to nearly double power production in the next six years, a development that could boost industry in one of the world’s poorest countries. The government is in talks with three Chinese companies to develop a 200 MW coal-fired power plant in the centre of the country by 2024. The government also plans to open a 7 MW solar power plant by the end of the year, and another in 2020 with about 20 MW of capacity. The three projects in total would in six years add 227 MW of power to a grid that now supplies about 250 MW.

China's power generation rose 7.2 percent year-on-year in the first 10 months of 2018. In October alone, China generated 533 billion kWh of power, up 4.8 percent year on year, faster than the 4.6-percent growth in September, according to the National Bureau of Statistics. The average daily power generation reached 17.2 billion kWh, edging down from 18.3 billion kWh in September. In the January-October period, new energy power generation accounted for 10.2 percent of the total power generation.

With drive to boost power generation, Nigerian government and key international donor agencies are finalising arrangements to sign a $956 million (N347.362 billion) deal for three key transmission projects for the TCN within the last 18 days of November. A report obtained on the proceeding of a meeting held by TCN and officials of the donor agencies indicates that the EU, JICA and the AFD – French Development Agency are expected to endorse the projects. The Federal Executive Council on its part this month will give approval for the execution of the World Bank funded projects. A breakdown of the report mentioned the project to be the Nigeria Electricity Transmission Access Project. It is valued at $486 mn and is being financed by the World Bank. The $200 mn Lagos/Ogun Transmission Project is the second on the list and is being financed by JICA while the Northern Corridor Transmission Project has funding of $245 mn and €25 million by AFD and the EU.

IEX: Indian Energy Exchange, PPAs: power purchase agreements, MW: megawatt, GW: gigawatt, HZL: Hindustan Zinc Ltd,  FY: Financial Year, ARR: Annual Revenue Requirement, kWh: kilowatt hour, discoms: distribution companies, BRPL: BSES Rajdhani Power Ltd, BYPL: BSES Yamuna Power Ltd, kV: kilovolt, PSPCL: Punjab State Power Corp Ltd, IPPs: independent power producers, EU: European Union, UK: United Kingdom, TCN: Transmission Company of Nigeria, JICA: Japanese International Cooperation Agency


HPCL to buy Iranian oil in January after six-month gap

7 December. Indian oil refiner Hindustan Petroleum Corp Ltd (HPCL) will buy Iranian crude in January after a gap of six months, with the nation’s overall purchases from Tehran at 9 million barrels in the month. The United States (US) in early November granted India a six-month waiver from sanctions against Iran’s oil exports. Under the agreement, New Delhi must restrict its Iran oil purchases to 1.25 million tonnes, or 9 million barrels. As part of the deal, HPCL will lift 1 million barrels of Iranian crude oil in January, one source with knowledge of the matter said, asking not to be named due to the political sensitivity of Iran sanctions. It was unclear whether HPCL would continue to buy Iranian oil on a regular basis during the waiver period. HPCL had halted Iranian oil purchases in July after its insurance company refused to provide coverage for the crude because of US sanctions, although its chairman said last month that HPCL may resume buying Iranian oil under sanctions waivers. Indian Oil Corp (IOC), the country’s top refiner, will lift 5 million barrels of Iranian oil in January compared to 6 million this month, while Mangalore Refinery and Petrochemicals Ltd (MRPL) will buy 3 million barrels. Some of India’s oil imports from Iran will be paid for in rupee under a payment mechanism with Indian state-owned UCO Bank.

Source: Reuters

IOC invites applications for setting up 27k petrol pumps

7 December. Indian Oil Corp (IOC), the country’s largest fuel retailer, said it has invited entrepreneurs to set-up 27,000 petrol pumps pan India. The retailer said that the eligibility norms have been relaxed this time and availability of suitable land at the advertised location or stretch was the most important requirement. However, applicants without land can also apply on a condition that when called by IOC they should be able to offer land. In a bid to cement their market leadership and expand their footprint in other geographical areas of the country, oil firms had invited applications last month to set-up 55,649 retail outlets in 30 states and union territories in the country. Out of these, about 27,000 petrol pump dealerships have been offered by IOC followed by 15,802 dealerships by Bharat Petroleum Corp Ltd and 12,865 by Hindustan Petroleum Corp Ltd. Cumulatively, oil marketing companies (OMCs) have offered setting up maximum number of fuel retail outlets through dealerships in Uttar Pradesh (9,370), Maharashtra (6,765), Karnataka (5,024) , Gujarat (4,450), and Haryana (3,370), according to information provided by the OMCs on the Petrol Pump Dealer Chayan website. Other states where sizeable number of retail outlets has been offered include Bihar (2,951), Tamil Nadu (2,951), Andhra Pradesh (2,815), Odisha (2,636), West Bengal (2,242), Jharkhand (1,905), Kerala (1,730), and Assam (1,026). India currently has 63,674 petrol and diesel retail outlets. The three government-owned OMCs account for 90 percent of these. Among private players, Nayara Energy tops the list with 4,895 retail outlets followed by Reliance Industries Ltd with 1,400, and Royal Dutch Shell with 116 outlets.

Source: The Economic Times

Oil Minister hopes OPEC will remember consumers when cutting output

7 December. Oil Minister Dharmendra Pradhan said he was hopeful that Organization of the Petroleum Exporting Countries (OPEC) would keep in mind consumers’ interests before deciding to cut crude oil production. OPEC tentatively agreed to an oil output cut but was waiting for a commitment from non-OPEC producer Russia before deciding on the exact volumes for a production reduction aimed at propping up oil prices.

Source: Reuters

ONGC gets $32 mn payment from Venezuela's PDVSA

5 December. India's Oil and Natural Gas Corp (ONGC) has received a payment of $32 million from Petroleos de Venezuela (PDVSA) as part of a settlement of outstanding dividend payments and said it hopes that Venezuela's state oil firm will be regular in making further payments, ONGC said. ONGC has a 40 percent stake in Venezuela's San Cristobal project, with PDVSA holding the remainder. In 2016, PDVSA and ONGC Videsh Ltd signed a deal that meant the state-owned Indian firm would get money from the sale of 17,000 barrels per day of oil to settle outstanding dividend payments of $537 million. PDVSA paid about $90 million of that but has not paid the rest.

Source: The Economic Times


MNGL comes under pressure to get land for CNG pumps

10 December. With nearly 3,000 new compressed natural gas-run vehicles added on city roads every month, authorities at Maharashtra Natural Gas Ltd (MNGL) are concerned about meeting the growing demand. The company currently has 55 CNG (compressed natural gas) stations in Pune. According to MNGL, at least 25 new CNG stations are required in the city to keep up with the rising demand. While the Pune Municipal Corp (PMC) offered nine parcels of land to develop CNG stations, MNGL said that most plots are not feasible. According to MNGL, the CNG stations running at optimal capacities coupled with the long lines are also coming in the way of more conversions.

Source: The Economic Times

India’s Petronet looking for long-term deal to buy US LNG

10 December. Top Indian gas importer Petronet LNG is looking to sign a deal in a year’s time to buy at least 1 million tonnes of US (United States) natural gas annually for a period of up to 10 years, as it pushes to diversify its supply sources beyond the Middle East. As part of any deal, the firm could potentially take a stake in a US liquefied natural gas (LNG) project, Petronet managing director Prabhat Singh said. Petronet currently runs a 15 million tonnes per annum (mtpa) LNG regasification site at Dahej in the western state of Gujarat and a 5 mtpa plant at Kochi in southern India. It has long-term deals to buy 10 mtpa of LNG, with 8.5 mtpa of that coming from Qatar’s RasGas. Singh said Petronet was in talks with various companies including Tellurian Inc about a potential US deal. Singh had said in November that Petronet and ONGC Videsh Ltd were jointly in talks to buy a stake in Tellurian’s proposed Driftwood project in Louisiana. Natural gas accounts for about 6.5 percent of India’s overall energy needs, far lower than the global average. The government wants to lift that to 15 percent in the next few years. A glut of natural gas in the US in the wake of the rapid development of shale fields there has kept benchmark US prices for LNG at almost half Asian levels. Meanwhile, Singh said Petronet was in talks to invest in exploration and LNG projects in Qatar, as well as continuing to scout for opportunities in Bangladesh and Sri Lanka.

Source: Reuters

Centre to spend Rs 700 bn to spread gas pipelines across country: Pradhan

5 December. The Centre will initially spend Rs 700 billion to spread gas pipelines across the country, and is working out plans to expand gas network to Myanmar through Bangladesh, Oil Minister Dharmendra Pradhan said. The central government is promoting gas-based economy which needs a massive network of pipelines for transportation of natural gas to various corners of the country, Pradhan said. Pradhan said India is planning to expand gas pipeline network to Myanmar through Bangladesh. Turning to Odisha, Pradhan said the state needs a huge infrastructure to store, refine and transport the natural gas to the doorstep of the industry from Paradip, Dhamra and Gopalpur.

Source: Business Standard


India's coal imports rise 9.7 percent to 156 mt during April-November period

9 December. India's coal import rose 9.7 percent to 156.08 million tonnes (mt) in the April-November period of the ongoing fiscal, as against 142.25 mt in the corresponding months a year ago, according to mjunction services Ltd, a joint venture between Tata Steel and SAIL. Coal imports in November this year also increased 10.1 percent to 19.47 mt, over 17.68 mt in the corresponding month of the last fiscal, mjunction data showed. Of the total imports last month, import of non-coking coal was at 14.24 mt, against 15.23 mt imported in October 2018. The import of coking coal was at 3.93 mt in November 2018, almost flat against 3.94 mt imported a month ago. India's coal and coke import during November 2018 through 31 major and non-major ports is estimated to have decreased by 5.32 percent over October 2018, according to a provisional compilation by mjunction, based on monitoring of vessels' positions and data received from shipping companies.

Source: Business Standard

Government sells 2.21 percent stake in CIL to CPSE ETF

6 December. The government has sold 2.21 percent stake in Coal India Lt (CIL) to the CPSE ETF which is managed by Reliance Nippon Life Asset Management Ltd. CIL accounts for over 80 percent of domestic coal production.

Source: Business Standard

Outlook for port sector stable, rebound in coal volumes positive for players: ICRA

5 December. Terming rebound in coal volumes and steady progress on the Sagarmala project positive for Indian port sector players in the medium term, rating agency ICRA maintained stable year-end outlook for the port sector. Coal imports, which had become a concern over the last 2 years, have been witnessing a rebound and could continue to with the momentum witnessed in first half of FY 2019, it said. Demand revival from the power sector and key consumer industries would be critical for sustained pick-up in coal imports, it said.

Source: Business Standard


'Maharashtra equipped to face rising electricity demand'

11 December. Maharashtra has recently called for short-term power purchase tenders where JSW Energy, KSK Energy, CESC and JP Nigrie agreed to supply power to the state in the October-December period. The state’s power demand had touched an all-time high of 24,851 MW in October. Maharashtra, the highest power consuming state in the country, is set to face the rising electricity requirement with adequate power purchase agreements (PPAs) and rising renewable energy capacity, state power ministry said. The state’s power demand had touched an all-time high of 24,851 MW in October. Though Maharashtra has become largely load-shedding free, there were a few instances of power cuts in October because the sudden spurt for 4,000 MW had arrived abruptly and the state was not given ample time to prepare for the demand surge, Maharashtra State Electricity Board said. Energy demand in Maharashtra had increased by 42% year-on-year in October.

Source: The Financial Express

How 3.4 mn households in UP are using power illegally

10 December. While the National Democratic Alliance (NDA) government is stepping up efforts to provide electricity connections to all households, around 3.4 million households in Uttar Pradesh (UP) are tapping power illegally. UP accounts for more than a third of new connections to be provided by December. With general elections scheduled to take place early next year, the state is key to the Union government’s ambitious exercise of electrifying more than 30 million rural and urban households under the Pradhan Mantri Sahaj Bijli Har Ghar Yojana (Saubhagya) scheme. With its target of 12 million connections, the state government is now trying to regularize these illegal connections, as the NDA proposes to showcase its success to reach 24x7 power across the country. Deen Dayal Upadhyaya Gram Jyoti Yojana, the scheme that helped bring electricity to all of India’s 597,464 census villages on 28 April, had set the stage for universal household electrification. The Centre aims to achieve the target by 31 March 2019. A village is declared electrified if 10% of the households, and public places, such as schools, panchayat office, health centres, dispensaries and community centres, have electricity. The government’s earlier plan was to provide electricity connections to 40 million Indian homes by December 2018, three months ahead of schedule.

Source: Livemint

Delhi’s BSES Lok Adalats settle 4k power theft cases

10 December. Delhi’s electricity distribution company (discom) BSES has settled a large number of power theft cases with a value of around Rs 390 mn through special Lok Adalats. The computerised Lok Adalats organised over the weekend as a paperless process by BSES Rajdhani Power Ltd (BRPL) and its sister discom in the capital, BSES Yamuna Power Ltd (BYPL), settled around 4,000 cases, according to BSES. BSES said the special courts provided customers in east, central, south and west Delhi a one-time opportunity for an amicable and on-the-spot settlement of cases relating to direct theft and meter tampering. BSES said that customers were given sufficient time to pay up in all the settled cases.

Source: Business Standard

Punjab plans to augment installed power generation capacity by 1 GW

​​9 December. Buoyed by the financial gains made by selling surplus power worth Rs 9.7 bn in the open market from April till October, the Punjab State Power Corp Ltd (PSPCL) has put in place a plan to further augment its power generation capacity by another 1,000 MW. It will conduct an 800 MW supercritical thermal power unit at the Ropar thermal power plant. It will also convert one of the 210 MW units at the Bathinda thermal power plant, which is shut down, into bio-mass unit to help farmers find a viable solution to stubble burning. This year the PSPCL had managed to sell 1,800 million units of power in the open market at Rs 5.4 a unit. Last year, the PSPCL had managed to sell power worth Rs 4.4 bn.

Source: The Economic Times

Power trading through open access system will be the future: KERC Chariman

5 December. Karnataka Electricity Regulatory Commission (KERC) Chairman M K Shankarlinge Gowda has said trading of electricity through Open Access System will turn out to be an accepted norm in the near future. On the draft Bill on Electricity Act pending in the Parliament, the Chairman said in order to develop uniform practices, the Centre needs to make guidelines and States should make laws as per those guidelines. In May 2018, India ranked 4th in the Asia Pacific region out of 25 nations on an index that measures their overall power growth, the Bangalore Chamber of Industry and Commerce said.

Source: The Economic Times

Power Grid bags first intra-state project under tariff-based competitive bidding

5 December. Power Grid Corp has bagged a project to set up a transmission system for evacuating electricity from the 1,320 MW Jawaharpur thermal power project and to construct a substation in Uttar Pradesh. This is also the "first intra-state transmission system project" won by the company under tariff-based competitive bidding. The company said it has been declared as the successful bidder to establish transmission system for evacuation of power from 2 x 660 MW Jawaharpur thermal power project and construction of 400 kilovolt substation at Firozabad along with associated transmission lines.

Source: Business Standard


Jawaharlal Nehru University to be powered by solar energy for 25 yrs

11 December. Jawaharlal Nehru University (JNU) is set to be powered by clean solar energy for the next 25 years. The university has implemented a 500 kilowatt solar rooftop plant that would provide power at a flat rate of Rs 3.39 per unit for the next quarter century. The plant, commissioned by the company Fourth Partner Energy for JNU, was jointly inaugurated by US (United States) ex-Secretary of State John Kerry and Vice Chancellor Jagadesh Kumar. The project has been set up under the 1,000 MW Grid-Connected Rooftop Solar PV System scheme for government buildings by Solar Energy Corp of India (SECI). Under the SECI scheme, the cost of setting up the solar power plant and its maintenance is undertaken by the developer. Kumar said JNU has starting installing solar power grid in its campus as part of the government’s efforts at expanding the solar capacity base to 99,533 MW by 2022. Fourth Partner Energy is a Renewable Energy Service Company mainly present in solar power space. It had in June raised $70 million from The Rise Fund and has executed 1,500 solar installations across 22 states so far.

Source: The Economic Times

Kishanganga hydro power project tunnel dewatered to lay cables

11 December. The authorities in Jammu and Kashmir have dewatered one of the tunnels of the Kishanganga Hydro Electric Project (KHEP) for laying of cable to Gurez valley in Bandipora district. The task of dewatering the 650-metre-long Adit-1 tunnel of the KHEP started on 19 November and was completed on 9 December, Bandipora Deputy Commissioner Shahid Iqbal Choudhary said. Choudhary said the district administration took a risk during winters to dewater the Adit tunnel of KHEP so that it could be used to lay BSNL cables, which was the only option left to connect the habitations of Kanzalwan, Bagtore, Izmarg and adjoinning villages. Hindustan Construction Company said it was a difficult task to dewater the tunnel, that too in chilling cold, but the logistical support by the deputy commissioner made the task easier for them as the task was completed in record 21 days.

Source: Business Standard

NTPC close to buying out UP government’s 50 percent equity in Meja thermal power project

11 December. Over a year after it had evinced interest in taking over the Uttar Pradesh government’s 50% equity in the 1,320 MW Meja thermal power project in order to lower the cost of electricity in the state and bring about greater efficiency, the country’s largest power producer NTPC seems to be close to sealing the deal. The Meja Urja Nigam is a 50:50 joint venture between NTPC and Uttar Pradesh Rajya Vidyut Utpadan Nigam in Allahabad, the Memorandum of Understanding for which was signed in 2007 when Mayawati was the Chief Minister. The first unit of 660 MW has already been commissioned and the second unit is likely to be ready by March 2019.

Source: The Financial Express

World Bank praises India's renewable energy success

10 December. The World Bank praised India's success in renewable energy auctions that delivered record-setting low prices for solar power and said that the number of countries with strong policy frameworks for sustainable energy more than tripled -- from 17 to 59 -- in the eight years till 2017. Many of the world's largest energy-consuming countries significantly improved their renewable energy regulations since 2010, said the World Bank's report -- Regulatory Indicators for Sustainable Energy (RISE) 2018, charting global progress on sustainable energy policies. While countries continue to be focused on clean energy policies for electricity, policies to decarbonize heating and transportation, which account for 80 percent of global energy use, continued to be overlooked. Senior Director for Energy and Extractives at the World Bank Riccardo Puliti said that the report contained a warning that without accelerated adoption of good policies and strong enforcement, the world's climate goals and Sustainable Development Goal 7 were at risk. By last year, 84 percent of countries had a legal framework in place to support renewable energy deployment, while 95 percent allowed the private sector to own and operate renewable energy projects.

Source: Business Standard

India has renewable energy projects of 46.5 GW capacity in the pipeline

10 December. India currently has renewable energy projects of 46,500 MW capacity in the pipeline for capacity addition. This includes projects which are currently under construction and those likely to be offered for bidding soon. India has made a commitment to the world that by 2030, 40 percent of its electric power generation capacity would come from non-fossil fuels and it will install 175 GW of renewable energy capacity by 2022, the Ministry of New and Renewable Energy (MNRE) said. The target includes 100 GW of solar, 60 GW of wind and 10 GW of small hydro power. The government expects to overachieve the 175 GW renewable energy target on the back of new schemes for floating solar power, awarding manufacturing-linked solar projects and offshore wind energy projects.

Source: The Economic Times

India to bid 80 GW of solar and wind energy projects by 2020

10 December. India has declared the trajectory of bidding 60 GW capacity of solar energy and 20 GW capacity of wind energy by March 2020, leaving two years time for execution of projects, the Ministry of New and Renewable Energy (MNRE) said. A total of about 73.35 GW renewable energy capacity has been installed in the country as of October, 2018, from all renewable energy sources. This includes about 34.98 GW from wind, 24.33 GW from solar, 4.5 GW from small hydro power, and 9.54 GW from bio-power. Further, projects worth 46.75 GW capacity have been bid out under installation. According to the Paris accord on climate change, India had pledged that by 2030 40 percent of installed power generation capacity shall be based on clean sources. And determined that 175 GW of renewable energy capacity to be installed by 2022. This includes 100 GW from solar, 60 GW from wind, 10 GW from bio-power and 5 GW from small hydro power. India has fifth global position for overall installed renewable energy capacity, fourth position for wind power and fifth position for solar power. The country registered lowest ever solar tariffs in India of Rs 2.44 per unit in reverse auctions carried out by the Solar Energy Corp of India (SECI) in May 2017, for 200 MW and again in July, 2018, for 600 MW.

Source: The Economic Times

Goa government proposes to tweak solar policy to incentivise production

9 December. To incentivise production of solar power in the state, the government has proposed a 50% subsidy for small prosumers (consumers and producers of solar power) as an amendment to the Goa State Solar Energy Policy, 2017. Instead of granting an interest-free loan that would be recovered in instalments from small prosumers, the government proposes to provide a 50% subsidy on capital costs to prosumers in the residential, institutional and social sector categories that have solar plants with a capacity of up to 100 kW (kilowatt). If the amendment is allowed, the Centre will bear 30% of the subsidy’s cost and the state, 20%. Also, such a subsidy will be released to the prosumer only six months after the solar power project is connected to the grid. The proposed amendments to the solar policy have been uploaded to the website of the Goa Energy Development Agency, The government has invited stakeholders and members of the general public to forward their comments latest by 5.45pm on 17 December to the agency’s member secretary either by post to the 5th floor, IDC building, Patto, or by emailing [email protected]. A single-window clearance portal for grid-connected rooftop solar installations has already been readied for consumers in Goa, but is yet to be launched.

Source: The Economic Times

NABARD signs $100 mn agreement with GCF to boost solar power

8 December. The National Bank for Agriculture and Rural Development (NABARD) signed an agreement with Green Climate Fund (GCF) to infuse $100 million into the project designed to unlock private sector initiatives for the creation of rooftop solar power capacity across India. The $250 million project, to be executed by Tata Cleantech Capital Ltd, will receive the GCF support through NABARD, which is the National Implementing Entity (NIE) for the UNFCC-promoted Fund that supports the efforts of developing countries to respond to the challenge of climate change, the bank said. The agreement with GCF was signed at an event held on the sidelines of ongoing COP24 in Katowice, Poland, it said. Notably, India, which hosts International Solar Alliance, has an ambitious vision of creating 100 GW solar power capacity it said. NABARD has been financing solar power projects and installations in various other programmes as well.

Source: Business Standard

Sugar industry capable of producing low emission clean fuel: Pradhan

8 December. Oil Minister Dharmendra Pradhan opined that the sugar industry has the capacity to produce low emission clean fuel. Pradhan asserted that the amount of bio-waste India generates can be converted into energy as that will not only generate energy but will help in waste disposal as well. Pradhan said the ISMA (Indian Sugar Mills Association) should come forward and contribute to the bio-energy sector to help provide sustainable fuel solutions to the country.

Source: Business Standard

Yamuna expressway to raise toll to bear cost of solar lights

7 December. Users of Yamuna expressway may have to pay more toll as the YEIDA (Yamuna Expressway Industrial Development Authority) has decided to set up solar lights on the 165 km (kilometre) stretch connecting Greater Noida to Agra and recover the cost from them. The cost of the project is nearly Rs 94 crore which will be met by increasing the toll tax. The move comes after Uttar Pradesh Chief Minister Yogi Adityanath recently directed the Yamuna expressway to improve safety along the expressway. YEIDA CEO (Chief Executive Officer) Arunveer Singh said the Authority had communicated to Jaypee Infratech, the concessionaire, to install lights on the entire stretch. Jaypee has agreed to the project and requested YEIDA to revise the toll to recover the project cost. The CEO said the Authority is yet to take a final decision on the toll revision. Once approved, Authority will facilitate in opening an escrow account to ensure the money is invested properly in the project implementation. The project will be completed by 31 March 2019.

Source: The Economic Times

Delhi government invites bids for setting up 35 MW rooftop solar power projects

7 December. The Energy Efficiency & Renewable Energy Management (EEREM) centre, Delhi government’s nodal agency for rooftop solar projects, launched a tender for setting up 35 MW grid-connected rooftop solar projects in the capital under the Mukhyamantri Solar Power Program. The tender invites e-bids for installation of rooftop solar projects across residential, social and institutional sectors to be developed in eight parts under both capital expenditure (CAPEX) and renewable energy service company (RESCO) models. Of the tendered capacity, 10 MW will be developed under the CAPEX mode and remaining 25 MW under RESCO. The government has appointed Indraprastha Power Generation Company Ltd (IPGCL) to oversee the proceedings of the tender and project execution on behalf of EEREM. Under the RESCO model, a developer finances, installs, operates and maintains the rooftop solar power plant on the consumer’s roof. The developer signs a power purchase agreement (PPA) with the rooftop owner. The rooftop owners consume the electricity generated from the solar plant for which they have to pay a pre-decided tariff that includes the Operation and Maintenance (O&M) cost to the RESCO developer on a monthly-basis for the tenure of agreement. The government is offering incentives to the developers and consumers. The developers will be eligible for a subsidy at the rate of 30 percent calculated at L1 project cost or the Ministry of New and Renewable Energy (MNRE) benchmark cost, whichever is lower under the CAPEX model, and fixed subsidy according to the MNRE benchmark cost for the RESCO Model, only after acceptance of the project by IPGCL. Delhi government is also giving a generation-based incentive of Rs 2 per unit on solar generation for a five-year period to residential consumers under the scheme.

Source: The Economic Times

NHPC to acquire 500 MW Lanco Teesta hydro power project for around Rs 9 bn

6 December. NHPC has bagged debt-laden Lanco's 500 MW Teesta hydro power project under insolvency proceedings for a tentative value of Rs 9 bn. NHPC is expected to complete the takeover in the next three to four months and can finish the project in three to four years as its construction is almost 50 percent complete. However, the company said this would be subject to final approval by the National Company Law Tribunal (NCLT). Lanco Teesta Hydro Power is building a 500 MW (125 MWX4) hydropower project on the Teesta river in Sikkim. As per the procedure, the NCLT would call for objections on the deal before approving it. Once approved by the NCLT, NHPC would seek approval of the Public Investment Board and the Cabinet Committee on Economic Affairs. NHPC has installed generation capacity of 7071 MW while 3800 MW is under construction.

Source: Business Standard

Air pollution killed 12.4 lakh people in India last year

6 December. One in every eight deaths in India was due to air pollution in 2017, according to a recent report by medical journal Lancet. The report said that 12.4 lakh deaths in India in 2017 were due to air pollution, which included 6.7 lakh deaths due to outdoor particulate matter air pollution and 4.8 lakh deaths due to household air pollution. The report said that with 18 percent of the global population, India suffered 26 percent of premature mortality and health loss attributable to air pollution, globally. The average life expectancy in India would have been 1.7 years higher if the air pollution level was less than the minimal level causing health loss, with the highest increases in Rajasthan (2.5 years), Uttar Pradesh (2.2 years), and Haryana (2.1 years). While the proportion of households using solid fuels has been improving in India, 56 percent of the population still used solid fuels in 2017. The disability-adjusted life year (DALY) rates, due to household air pollution, varied 145-fold among Indian states in 2017, and varied sixfold for outdoor particulate matter air pollution.

Source: The Economic Times

Bihar CM inspects solar power plants in West Champaran villages

6 December. Bihar Chief Minister (CM) Nitish Kumar made an on-the-spot inspection of two solar power plants at Champapur and Radhiya villages in West Champaran district. A 20 kW (kilowatt) solar mini grid plant has been installed at Champapur to provide power connection to all households under the Har Ghar Bijli Yojana. A total of 121 families in the village have been provided power connection from the grid. CM visited the houses of Etwaria Devi, Gorakh Oraon, Chandi Oraon, Parashnath Oraon and a few others to himself verify the availability of power in their homes. He also inquired about the other problems of the villagers. He said those entrusted with the responsibility to install solar power plants in the villages would also ensure their maintenance for the next five years. He had advised the departments concerned to take necessary steps to install solar plants in all residential schools for SCs/STs and EBCs so that people could be made more aware about solar energy.

Source: The Economic Times

MNRE to seek cabinet nod soon for rooftop solar scheme SRISTI

6 December. The Ministry of New and Renewable Energy (MNRE) will approach the Union cabinet in the next 30-45 days seeking approval for the solar rooftop scheme SRISTI or Sustainable Rooftop Implementation for Solar Transfiguration of India. The scheme, part of the larger grid-connected Rooftop Solar (RTS) power programme, aims to bring discoms (distribution companies) to the forefront in the implementation of rooftop solar projects by providing them financial support which will be linked to their performance in facilitating the deployment of RTS. The second phase of the original solar rooftop scheme is designed to boost the adoption of rooftop in the residential space and would use the network of distribution companies. The government has set a target to install 40,000 MW of rooftop solar power capacity by 2022.

Source: The Economic Times

India's wind power potential slumping due to warming of Indian Ocean

6 December. The warming of the Indian Ocean due to global climate change may be causing a slow decline in India's wind power potential, according to a study. India, the third largest emitter of greenhouse gases behind China and the United States (US), is investing billions in wind power and has set the ambitious goal to double its capacity in the next five years, researchers from the Harvard John A Paulson School of Engineering and Applied Sciences (SEAS), said. The majority of wind turbines are being built in southern and western India to best capture the winds of the summer Indian monsoon, the seasonal weather pattern then brings heavy rains and winds to the subcontinent. The study, published in the journal Science Advances, found that the Indian monsoon is weakening as a result of warming waters in the Indian Ocean, leading to a steady decline in wind-generated power. The research calculated the wind power potential in India over the past four decades and found that trends in wind power are tied to the strength of the Indian Summer Monsoon. In fact, 63 percent of the annual energy production from wind in India comes from the monsoon winds of spring and summer, researchers said. Over the past 40 years, that energy potential has declined about 13 percent, suggesting that as the monsoon weakened, wind power systems installed during this time became less productive, researchers said. Western India, including the Rajasthan and Maharashtra states, where investment in wind power is the highest, has seen the steepest decline over that time period, researchers said. However, other regions, particularly in eastern India, saw smaller or no decline, researchers said. The researchers aim to explore what will happen to wind power potential in India in the future, using projections from climate models.

Source: Business Standard

Cabinet nod sought to categorise hydro power as renewable energy

6 December. The power ministry has sought Cabinet approval for a policy change categorising large hydro projects as renewable energy sources. Currently, only hydro projects under 25 MW are identified as renewable energy. Apart from helping the country attain the target of having 175 GW renewable capacity by 2022, the renewable energy tag would help hydro power get a priority over thermal electricity while being dispatched to the consumers. The hydro sector would also get additional leg-up as the states can fulfill their mandatory renewable purchase obligations by buying electricity from these power plants. The power ministry note seeks the Cabinet approval for introducing a separate ‘hydropower purchase obligation’ category. To reduce hydro power tariffs, the ministry wants the cabinet to approve, modify existing norms and not let the host states receive free power from hydro power plants till five years from commissioning.

Source: The Financial Express

India likely to commission major hydropower project in Bhutan: Gokhale

5 December. India is likely to commission a major hydropower project in Bhutan this month, Foreign Secretary Vijay Gokhale has said. Gokhale said India is committed to harnessing the true potential for growth of cooperative ties with Bhutan, and exploring newer avenues for advancing it further. Over the years, the Indo-Bhutan mutually beneficial cooperation has been anchored in the remarkable cooperation in the energy sector, he said.

Source: Business Standard

NTPC wins 85 MW solar capacity in a reverse auction held by UP government

5 December. NTPC Ltd said it has won 85 MW of solar capacity in a reverse auction held by the UP (Uttar Pradesh) government. NTPC participated in the 550 MW tender floated by Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA) for grid-connected solar projects. In the reverse auction held on 3 December 2018, NTPC participated for 85 MW solar capacities and has won the entire capacity bid by it, at a levelised tariff of Rs 3.02/unit, applicable for 25 years, the company said. The above 85 MW of solar projects shall be set up by NTPC and shall add to the installed capacity of NTPC, the company said.

Source: Business Standard

India's first hybrid solar-wind auction yields tariff under Rs 2.70 per unit

5 December. In the country's first solar-wind hybrid auction conducted by the Solar Energy Corp of India (SECI) has yielded the lowest highly competitive tariff of less than Rs 2.70 per unit, the government said. The government has embarked on the development of non-conventional renewable energy sources, while the first round of auctions for floating solar projects had successfully discovered tariffs as low as Rs 3.22 per unit, the MNRE (Ministry of New and Renewable Energy) Secretary Anand Kumar said. Kumar said that having made a global commitment that, 40 percent of India's electric capacity would come from non-fossil fuels by 2030, the country is well on course to install 175 GW of renewable capacity by 2022.

Source: Business Standard

MNRE creating database for renewables energy sector, land availability

5 December. The Ministry of New and Renewable Energy (MNRE) is preparing a database to identify the land available for solar and wind energy projects in the country. Plans are on to introduce location-specific bids to strengthen transmission facilities, MNRE Secretary Anand Kumar said. MNRE officials visited states, including, Gujarat, Telangana, Andhra Pradesh, Madhya Pradesh, etc. and are in the process of doing the assessment in Tamil Nadu and Karnataka. Knowing the availability of land and the potential for renewable energy in the location would help in better bids and improve confidence in investors.

Source: Business Standard

Hydro power in India likely to see boost with 10 GW units, new policy

5 December. Hydro power in India is likely to see a boost with projects of close to 10 GW to either restart or commence construction. Along with this, the Centre is moving a policy for promoting hydro power, which aims at reducing the cost of construction. The policy is likely to do away with any requirement for creating irrigation facilities, allied assets or any social infrastructure in order to bring down costs. Uttarakhand, which decided to forgo 4 GW of hydro projects following ecological issues, and the Supreme Court directive to stop constructing dams, had sought financial support from the Centre.

Source: Business Standard


Iran keeps crude prices in Asia at wide discounts against Saudi oil in January

11 December. Iran has set the official selling price (OSP) of its Iranian Light grade for its Asian buyers at 30 cents above the Platts Oman/Dubai average for January, $1 lower than the previous month, a price document showed. The producer has cut prices for the other three crude grades it sells to Asia. The price cuts were in line with Saudi crude price adjustments for January, keeping Iranian oil prices at the largest discounts in more than a decade against Saudi grades for a third consecutive month since November when US (United States) sanctions on Iran started. China’s Iranian oil imports are set to rebound in December after two state-owned refiners in the world’s largest oil importer began using the nation’s waiver from US sanctions on Iran while Japanese and South Korean buyers are preparing to resume loadings in January.

Source: Reuters

US retail gasoline prices drop to lowest in 1.5 yrs

11 December. US (United States) gasoline prices at the pump fell to the cheapest in about a year-and-a-half, driven lower by sagging crude oil prices and excess supply of the fuel, market participants said. Gasoline futures on the New York Mercantile Exchange RBc1 were the lowest seasonally since 2015. Prices have changed course from earlier this year, when they hit seasonal four-year highs. Plummeting oil futures have helped deflate gas prices. Crude has plunged about 30 percent since October as global supply has surged and demand growth has weakened. Further, analyst said excess supply of gasoline in the US has depressed prices. US refiners have been encouraged to run at high rates to take advantage of strong diesel margins. However, in the process they have over produced gasoline and driven up those inventories.

Source: Reuters

Eni makes new oil discovery

10 December. Eni announced a new oil discovery in the Afoxe exploration prospect, located in Block 15/06 offshore Angola. The discovery, which was made through the Afoxe-1 NFW well, is estimated to contain between 170 and 200 million barrels of light oil in place, according to Eni. Afoxe-1 NFW is situated in the southeast area of Block 15/06, approximately 12 miles west of the Kalimba-1 discovery, which Eni announced back in June. Afoxe-1 NFW was drilled in a water depth of 2,559 feet and reached a total depth of 5,652 feet. The Kalimba-1 find is estimated to contain between 230 and 300 million barrels of light oil in place. In October, Eni announced an oil discovery in the western Barents Sea within license PL 532. Preliminary estimates of the size of the discovery range between 50 and 60 million barrels of oil in place, according to Eni. The company has made two oil discoveries within the Faghur basin in the Egyptian Western Desert during 2018.  The first of these was announced by the company in May, and the second in July.

Source: Rigzone

Militia forces Libya’s NOC to declare force majeure on biggest oilfield

10 December. Libya’s National Oil Company (NOC) declared force majeure on exports from the El Sharara oilfield, which was seized at the weekend by a local militia group. NOC said the shutdown would result in a production loss of 315,000 barrels per day (bpd) at its biggest oilfield, and an additional loss of 73,000 bpd at the El Feel oilfield. Production at the Zawiya refinery was also at risk due to its dependence on crude oil supply from Sharara, NOC said.

Source: Reuters

Malaysia agrees to extend its oil output cut by 6 months

8 December. Malaysia will extend its oil production cuts by another six months after the agreement between OPEC (Organization of the Petroleum Exporting Countries) and other oil producers to reduce global supply ends this year. OPEC and non-OPEC producers agreed at a meeting in Vienna to a new level of production cuts from January to June 2019, setting it at 1.2 million barrels per day from the current rate of 1.8 million barrels per day. Malaysia is not an OPEC member. In 2016, via its state-owned oil company Petroliam Nasional Berhad, Malaysia announced that it would cut oil output by 20,000 barrels per day as part of its commitment to reduce supply following an agreement between the OPEC and non-OPEC producers. The initial agreement, led by Russia, was later extended for another year till the end of 2018.

Source: Reuters

Kazakh central bank cuts oil output forecast for 2018-19

7 December. Kazakhstan’s central bank has trimmed its forecast for the country’s oil output in 2019 and said it expects Brent crude oil to average $60 a barrel next year. The bank said that it expects the country to produce 91 million tonnes of oil next year, down from its previous estimate of 93 million tonnes, and taking into account scheduled maintenance work at oilfields. It reduced its forecast for oil production this year to 90 million tonnes from 91 million tonnes. The new forecasts would still be above forecasts in the government’s budget for oil production of 87 million tonnes this year and 88 million tonnes in 2019.

Source: Reuters

Marathon Petroleum CEO expects retail gasoline prices to average $2.25 a gallon in 2019

6 December. Retail gasoline prices in the United States should average $2.25 a gallon in 2019, Marathon Petroleum CEO (Chief Executive Officer) Gary Heminger said. Heminger said that he expects crude oil prices to stay in a range of $60-$70 a barrel.

Source: Reuters

Argentina announces $2.3 bn joint shale oil project with Malaysia’s Petronas

5 December. Argentina’s state-controlled energy company YPF and Malaysia’s Petronas are forming a joint venture to invest $2.3 billion over the next four years in the country’s Vaca Muerta shale oil fields, the president’s office announced. The Belgium-sized Vaca Muerta deposit, located in western Argentina, is regarded as having the world’s second-largest shale gas and fourth-largest shale oil deposits. The companies’ objective is to reach a production equivalent of 60,000 barrels a day by 2022, it said. Total investment could reach $7 billion within 20 years, it said.

Source: Reuters


Shell to go ahead with Shearwater gas expansion in North Sea

10 December. Royal Dutch Shell said it would expand the Shearwater gas hub in the British North Sea, its seventh project to get the green light in the aging basin this year. The project, a joint venture with Exxon Mobil and BP, will include a modification of the Shearwater platform to allow production and processing of wet gas as well as the construction of a 23 mile (37 kilometre) pipeline from the Fulmar Gas Line to Shearwater, Shell said. The pipeline installation, which will enable wet gas to flow into the Shell Esso Gas and Associated Liquids pipeline, is scheduled for 2019, while the platform expansion is scheduled for the following year, according to Shell. At peak production, the wet gas export capacity of the Shearwater hub is expected to be around 400 million standard cubic feet of gas a day, or roughly 70,000 barrels of oil equivalent per day.

Source: Reuters

Australia grabs world’s biggest LNG exporter crown from Qatar in November

10 December. Australia overtook Qatar as the world’s largest exporter of liquefied natural gas (LNG) for the first time in November, Refinitiv Eikon data showed. In November, Australia loaded 6.5 million tonnes of LNG for exports while Qatar exported over 6.2 million tonnes, the data showed. Qatar plans to boost its LNG capacity by early 2024 to 110 million tonnes a year, up from its current production of 77 million tonnes a year, by adding a fourth LNG production line. Qatar, which exports around 600,000 barrels per day of crude oil, said it would leave the Organization of the Petroleum Exporting Countries (OPEC) to focus on gas. Wood Mackenzie analyst Nicholas Browne said the drop in Qatari LNG exports in November was due to maintenance, making Australia’s time at the top limited. However, Australia’s hold on the top spot could be fairly short as LNG exports are being blamed for rising domestic gas prices, which has become a political issue in the country.

Source: Reuters

US LNG developer Tellurian strikes initial offtake deal with Vitol

6 December. Tellurian, which is developing a liquefied natural gas (LNG) export project on the United States (US) Gulf Coast, has signed a preliminary deal to supply LNG to commodities trader Vitol. The deal prices the LNG against Platt’s Japan Korea Marker (JKM), the first time the daily assessment of spot LNG prices in northern Asia has been used for a long-term offtake agreement, according to S&P Global Platts. In the US, such long-term deals, critical to the financing of export terminals, are priced against the US Henry Hub gas price. Most deals elsewhere are priced against oil, while some are priced against other natural gas hubs. The Memorandum of Understanding (MoU) is Tellurian’s first preliminary offtake deal for its Driftwood LNG project. An MoU usually leads to a binding Sales and Purchasing Agreement (SPA). Vitol aims to buy 1.5 million tonnes per year (mtpa) of LNG from Driftwood for 15 years once operations begin. The export terminal in Louisiana aims to have a capacity of 27.6 mtpa and to start operations by 2023. Tellurian had previously said it was in talks with about 25 prospective customers including Total, General Electric and Bechtel, which has a $15.2 billion contract to build the LNG terminal.

Source: Reuters

Trafigura, Gunvor lowest bidders in LNG tender: Pakistan LNG

6 December. Pakistan LNG said commodity traders Trafigura and Gunvor had made the lowest bids in a tender to supply three cargoes of liquefied natural gas (LNG) between late January and late February. It said Trafigura made the lowest bid to supply a cargo on 21-22 January at 14.4 percent of Brent crude oil prices, Gunvor’s bid for the 3-4 February cargo was at 15.8 percent and Trafigura again bid the lowest for 21-22 February at 14.8 percent. Vitol Bahrain had bid to supply two cargoes but at higher prices, according to a Pakistan LNG commercial evaluation document. BB Energy had sent in bidding documents but they did not technically qualify. The prices, expressed in the document as crude oil slope or the numerical percentage of Brent crude price, are a valuable pointer for the opaque spot LNG market. A cargo priced at 14.4 percent of Brent is about $8.66 per million metric British thermal unit (mmBtu). Spot Asian LNG prices for January were heard at $9.80 per mmBtu although they have since fallen to closer to the $9.00 per mmBtu mark. Pakistan LNG launched a tender for the three cargoes in November, the first for LNG since June.

Source: The Economic Times

Russia’s Novatek seen launching small-scale LNG plant in Baltic Sea in February

6 December. Russia’s largest non-state natural gas producer Novatek will start producing liquefied natural gas (LNG) on the shore of the Baltic Sea in February, the contractor, Atomtekhenergo, said. Novatek, along with Gazprombank, is building an LNG plant and terminal in the Baltic Sea port of Vysotsk with a capacity of 660,000 tonnes of the frozen gas per year. The plant’s capacity could be expanded to 800,000 tonnes in 2021. Novatek is the main owner of Russia’s largest LNG project, Yamal LNG, with produces gas at the rate of 16.5 million tonnes per year.

Source: Reuters

Iraq needs 2 yrs to wean itself off Iranian gas

6 December. Iraq needs at least two years to boost the country’s gas production to stop importing Iranian gas used to feed its power stations. Hayan Abdul Ghani, head of South Gas Co (SGC), said that Iraq’s gas output is expected to reach 1.3 million cubic feet per day (mcf/d) by the end of 2020, an increase of 400 mcf/d from current levels. The United States (US) said that Iraq can continue to import natural gas and energy supplies from Iran for a period of 45 days as long as Iraq does not pay Iran in US dollars. Sanctions on Tehran’s oil sector took effect on 5 November. Abdul Ghani said the expected rise in gas production would come from two new projects, including a $367 million deal with General Electric reached in April to process natural gas extracted alongside crude oil at two fields in southern Iraq. The project is expected to start producing 160 mcf/d in two years, Abdul Ghani said. Iraq is expected to sign another deal in early 2019 to build the Artawi gas plant in the south which is planned to produce around 300 mcf/d by end 2019. Iraq’s gas development plans have long focused on BGC, a $17 billion joint venture between Royal Dutch Shell, state-run South Gas Company and Mitsubishi. Abdul Ghani said Iraq is seeking to reach gas production of around 2000 mcf/d by the end of 2023, including 1.43 mcf/d from the Basra Gas Co. and additional 500 mcf/d from other future projects in the south. South Gas Co is still in talks with US energy company Orion Gas Processors over the economic and technical aspects of a final deal to capture and process 100 million to 150 mcf/d of natural gas extracted from Nahr Bin Omar southern oilfield, the SGC chief said. Iraq signed a Memorandum of Understanding with the US company to build facilities to capture the gas from the field located in southern Iraq and to transform it into usable fuels.

Source: Reuters

South Korean firm proposes building LNG import terminal in Australia

5 December. A South Korea-based company has proposed building a terminal on Australia’s east coast to import liquefied natural gas (LNG), the fifth proposal for such a project in the world’s No.2 LNG exporter. The proposals have come after three new LNG export plants on the east coast have sucked gas out of the southeastern market and nearly tripled wholesale gas prices in places such as Sydney over the past two years. EPIK, a newly-formed LNG floating storage and regasification unit (FSRU) project development company, said it had signed an agreement with the Port of Newcastle to do preliminary work on a proposed FSRU that it estimated would cost up to $430 million, including onshore infrastructure.

Source: Reuters

Tokyo Gas, First Gen to build LNG terminal in Philippines

5 December. Tokyo Gas Co has signed a joint development agreement with Philippines’ First Gen Corp to build and operate a liquefied natural gas (LNG) receiving terminal in the Philippines, its first foray into energy infrastructure development in Southeast Asian country. The Philippines in October had short-listed three different groups of companies, including the Tokyo Gas partnership with First Gen, to build and operate its first LNG import terminal. First Gen, which owns about 60 percent of the gas-fired power plants in the Philippines, is the biggest natural gas user in the country, Tokyo Gas said.

Source: Reuters

Gazprom begins operations at final unit of giant Arctic gas field

5 December. Russian gas giant Gazprom said it had begun operations at a third and final unit at its Bovanenkovo gas field on the Arctic Yamal peninsula, allowing it to boost natural gas production. Gazprom said it had increased the capacity of the Ukhta-Torzhok gas pipeline, aimed at facilitating Russian gas exports to northern Europe, including via the Nord Stream pipeline. Gazprom plans to export record-high natural gas volumes of 200 billion cubic meters (bcm) to Europe this year. The company said that with the launch of the final unit, Bovanenkovo will reach a projected capacity of 115 bcm of gas per year. The gas field with reserves of just under 5 trillion cubic meters - on par with global annual gas demand - is key to the company’s efforts to tap new deposits, apart from its traditional producing region of Western Siberia. Last year, it produced 82.8 bcm of gas.

Source: Reuters


Indonesia Adaro’s 2019 coal output seen at 54-56 mt: CEO

11 December. PT Adaro Energy Tbk, one of Indonesia’s largest coal miners, is estimated to produce 54-56 million tonnes (mt) of coal in 2019, the same amount as estimated for 2018, Chief Executive Officer (CEO) Garibaldi Tohir said. Tohir said the market condition would remain challenging in 2019 due to lingering threat of trade war between the United States and China and Chinese coal import restrictions

Source: Reuters

South Korean prosecutors indict four for importing North Korean coal

10 December. South Korean prosecutors have charged four people with illegally importing millions of dollars worth of North Korean coal in violation of international sanctions, by trying to disguise it as imports from Russia, a prosecutors’ office said. South Korea’s customs agency found in August that some firms had imported coal from North Korea in violation of UN (United Nations) resolutions aimed at choking off funding for its nuclear and ballistic missile programmes. The unidentified defendants were charged with bringing in North Korean coal and other material by “laundering the origin” through fake certificates of origin from Russian ports, after the old route for North Korean coal, through China, was blocked due to sanctions, the Daegu District Public Prosecutors Office said.

Source: Reuters

EU’s largest coking coal producer seeks growth through acquisitions

7 December. The European Union (EU)’s largest coking coal producer JSW could increase output by between 2.5 and 3 million tonnes per year by acquiring assets, far exceeding its current plan to grow production to 18 million tonnes by 2030 from roughly 15 million now. JSW said coking coal, used in steel, is distinct from thermal coal for power generation, has a long future and is on the EU’s list of strategic minerals. JSW plans to increase overall output, although the relatively small share of thermal coal — currently 25 percent — would dwindle to 10 percent over time.

Source: Reuters

US coal consumption drops to lowest level since 1979

5 December. Americans are consuming less coal in 2018 than at any time since Jimmy Carter's presidency, a federal report said, as cheap natural gas and other rival sources of energy frustrate the Trump administration's pledges to revive the US (United States) coal industry. A report by the US Energy Information Administration projected that 2018 would see the lowest US coal consumption since 1979, as well as the second-greatest number on record of coal-fired power plants shutting down. The country's electrical grid accounts for most of US coal consumption. US coal demand has been falling since 2007 in the face of competition from increasingly abundant and affordable natural gas and renewable energy, such as solar and wind power. President Donald Trump has made bringing back the coal industry and abundant coal jobs a tenet of his administration.

Source: The Economic Times


France considering lower electricity tax for households

6 December. In the wake of violent protests across France sparked by planned tax rises on gasoline and diesel the government is considering lowering taxes on electricity. Prime Minister Edouard Philippe announced that he was scrapping the fuel tax increases planned for 2019, having announced a six-month suspension the day before, in a bid to defuse the worst crisis of President Emmanuel Macron’s presidency. The government said it would prevent state-controlled EDF from raising its regulated power prices this winter, but rivals said they would challenge that decision in court. Earlier government attempts at freezing prices have been overruled. Household power prices are set by independent energy regulator CRE using a formula that includes the price of power generation, transport and distribution. A third part of the retail price is made up of taxes. The government could lower the Valued Added Tax (VAT) or so-called CSPE tax, which stands at €22.5 per megawatt-hour and raised €3 billion ($3.40 billion) this year. Money from that tax also funds power subsidies for low-income families. The energy ministry said that the government was looking at ways to stabilize power bills but said that no final decision had been taken yet.

Source: Reuters

Laos to export over 14 GW of electricity by 2030

6 December. Laos' electricity exports will hit 14,600 MW by 2030. At present, Laos is exporting 4,415 MW to five neighbouring countries. The Lao government has signed a contract with the Chinese side for cooperation on construction of a national electricity transmission line. The government is working on this with China's state-owned power grid company, conducting technical and economic feasibility, and expects it to finish by 2019. The governments of Laos and Thailand have signed a power trade agreement for 9,000 MW. Laos currently supplies over 4,000 MW electricity to Thailand and the Lao government is expecting to increase the power supply to 7,000 MW by 2020 and 9,000 MW by 2030 respectively. Laos sells over 300 MW to Vietnam and the Lao government expects to increase the power supply to 1,000 MW by 2020 and 5,000 MW by 2030, Lao Minister of Energy and Mines Khammany Inthirath said. Laos plans to sell 100 MW electricity to Malaysia via Thailand and the government expects to sell 300 MW more by 2020. The Lao government will sell 10 MW of electricity to Cambodia and expects to sell 200 MW more by 2020. The Lao government sold 5 MW of electricity to Myanmar and will sell 100 MW more by 2022. Meanwhile, the governments of Laos and Myanmar have signed a cooperation contract on power purchasing, the Minister said.

Source: Xinhua

Germany’s EEX and Bulgaria’s IBEX in power futures tie-up

6 December. German power exchange EEX and Bulgarian peer IBEX have signed a cooperation deal to introduce Bulgarian electricity futures in first half 2019 as the market-leading EEX bourse pushes further east. Bulgaria is in the process of liberalising its state-run energy systems while IBEX, owned by state-controlled stock exchange BSE, aims to strengthen ties with other EU wholesale power markets. EEX plans to list euro-denominated weekly, monthly, quarterly and annual futures contracts for baseload or 24-hour power supply, to be settled against the day-ahead price assessment by IBEX, the exchanges said. The EEX said it will start Serbian and Slovenian power futures contracts at the same date the Bulgarian futures products are introduced. That will give EEX a presence in 20 market zones across Europe, strengthening its lead as biggesst continental European power market, it said.

Source: Reuters

UK steel sector crippled by power costs as Brexit looms

5 December. British steelmakers pay twice as much for electricity as their French competitors and 50 percent more than their German rivals, piling pressure on the sector as Britain prepares to leave the European Union (EU). The report, commissioned by industry group UK (United Kingdom) Steel, shows the disparity between UK electricity prices and those in EU countries has increased for a third consecutive year, crippling energy-intensive sectors such as steel.

Source: Reuters


Britain’s Octopus signs Italian solar power deal with Shell

11 December. British renewable investor Octopus has signed a five-year power purchase agreement (PPA) to supply Shell Energy Europe Ltd with generation from its portfolio of Italian solar projects. The deal is Octopus’ first PPA in Italy and will cover six of its 10 Italian solar projects currently under construction once they have been completed in early 2019. The six projects have a combined capacity of around 70.5 MW.

Source: Reuters

Bulgaria hopes to pick investor for nuclear plant by end of 2019

7 December. Bulgaria plans to open a tender to pick a strategic investor for its revived Belene nuclear power project on the Danube and to pick a winner by the end of 2019, Energy Minister Temenuzhka Petkova said. China’s CNNC, France’s Framatome - a unit of EDF - and Korea Hydro & Nuclear Power Co have expressed interest in the project to build two 1,000 MW nuclear reactors at Belene. Petkova said an invitation to become a strategic investor would also be extended to Russia’s Rosatom. Bulgaria plans to keep a blocking stake in the venture, Petkova said.  Bulgaria has been sitting on unused nuclear equipment since paying Rosatom more than €620 million ($712 million) for scrapping the project six years ago.

Source: Reuters

California first state to mandate solar power for new homes

7 December. California became the first state in the nation to require homes built in 2020 and later be solar powered, following a vote by the Building Standards Commission. The unanimous action finalises a previous vote by the Energy Commission and fulfills a decade-old goal to make the state reliant on cleaner energy. Homebuilders have been preparing for years to meet a proposed requirement that all new homes be "net-zero," meaning they would produce enough solar power to offset all electricity and natural gas consumed over the course of a year.

Source: The Economic Times

Japan eases conditions for solar power subsidy curbs

6 December. The Japanese government has decided to relax the conditions for cutting solar power subsidies for projects that have not started operations following opposition from power producers and other firms. The Ministry of Economy, Trade and Industry (METI) in October had proposed that companies granted permits for solar projects between the fiscal years of 2012 and 2014 under the so-called Feed-In-Tariffs (FIT) system that guarantees minimum power prices submit applications by March 2019 to connect to the grid. But the proposals had angered power producers and investors who say the cuts will undermine their profitability and violate earlier agreements. METI said it would delay the deadline for submission of applications for at least 2 MW projects to the end of September. The deadline for start of operations was also delayed by six months to the end of September 2020.

Source: Reuters

Denmark, Britain top global league for climate measures

5 December. Denmark and Britain are the top countries when it comes to implementing measures to fight climate change, although Britain has lagged in phasing out fossil fuel subsidies. Denmark, Britain and Canada have made the most progress in transforming their energy sectors toward meeting the targets, the report by researchers from Britain’s Imperial College, commissioned by British power generator Drax, said. Denmark has decarbonised its electricity sector, moving away from coal, installing renewables and reducing fossil fuel subsidies by 90 percent over the last decade. Britain has invested heavily in offshore wind and plans to phase out coal-fired power generation by 2025.

Source: Reuters


Electrification Scenario of Villages in India

Year No. of Villages Electrified
2006-07 28, 706
2007-08 9, 301
2008-09 12, 056
2009-10 18, 374
2010-11 18, 306
2011-12 7, 285
2012-13 2, 587
2013-14 1, 197
2014-15 1, 405
2015-16 7, 108
2016-17 6, 015

State-wise Number of Villages Electrified from 2014 to 2018

Source: Rajya Sabha Un-starred Questions

Publisher: Baljit Kapoor

Editorial Adviser: Lydia Powell

Editor: Akhilesh Sati

Content Development: Vinod Kumar

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