India’s annual electricity demand in 2019 grew at its slowest pace in six years with December marking a fifth straight month of decline, government data showed. Electricity demand is seen as an important indicator of industrial output in the country and a sustained decline could mean a further slowdown in the economy. India’s power demand grew at 1.1 percent in 2019, data from the CEA showed, the slowest pace of growth since a 1 percent uptick seen in 2013. The power demand growth slowdown in 2013 was preceded by three strong years of consumption growth of 8 percent or more. In December, the country’s power demand fell 0.5 percent from the year-earlier period, representing the fifth straight month of decline, compared with a 4.3 percent fall in November. But in Maharashtra and Gujarat, two of India’s most industrialised provinces, monthly demand increased. In October, power demand had fallen 13.2 percent from a year earlier, its steepest monthly decline in more than 12 years, as a slowdown in Asia’s third-largest economy deepened. Industry accounts for more than two-fifths of India’s annual electricity consumption, while homes account for nearly a fourth and agriculture more than a sixth. Tamil Nadu’s power consumption this Pongal was the lowest in recent years. Power consumption, when the state celebrated ‘Kaanum Pongal’, was 219 mn kWh against 274 mn kWh units registered during last year’s Pongal. It is lower than the power consumption last Diwali, when it was 244.96 mn kWh. Meanwhile, TANGEDCO has also been able to juggle its power production by keeping many of its thermal units on standby and meeting the power demand with power sourced from central units and private power companies since the tariff was low. TANGEDCO’s thermal units have generated 17,484.62 mn units between April and December, 2019. Whereas, 20,510.61 mn kWh were generated during the same period in 2018. The discom has a total 4320 MW of thermal unit capacity. As per the data released by Central Electricity Authority, the plant load factor of the TANGEDCO units is 57.04 percent compared to previous year’s 67.09 percent. The discom will have to depend only on its own thermal units till April, besides tapping power from other regular sources. Spot power market witnessed a 51 percent surge year-on-year in electricity trading in December 2019 at 4,768 mn kWh due to surge in power demand from cold wave-hit northern states. The electricity trade on India Energy Exchange was up 25 percent over November 2019. The increase in traded volumes on the Exchange was largely due to surge in demand from the northern states as well as the southern States. The northern states experienced intense cold wave this month leading to an increase in peak demand in several states. The day-ahead market traded 4,333 mn kWh with an average market clearing price at ₹2.93/kWh vs ₹3.3/kWh in December 2018, an 11 percent decline in price. In the day-ahead market, total monthly sell bids were 10,195 mn kWh while buy bids were 5,260 kWhs. Sell bids at nearly two times of the buy bids coupled with lower clearing prices signified that the market remained attractive for both the distribution utilities as well as open access buyers. One Nation One Price prevailed for 21 days during the month. The congestion was mainly towards import of power by the southern States especially during the peak hours since high voltage Bhadrawati transmission line was under outage leading to import capacity reduction.
Thousands of houses in far-flung areas of Rajouri district in Jammu and Kashmir are experiencing a positive difference in their lives after receiving electricity connection under the Soubaghya Electricity scheme. Over 20,000 houses have received the power. Under Saubhagya free electricity connections to all households (both APL and poor families) in rural areas and poor families in urban areas will be provided.
Sixteen mini power projects with a total generating capacity of 1,637 MW are being commissioned in Meghalaya to make the north eastern state self-reliant in electricity. The 1,637 MW installed capacity of the 16 under construction power projects, 801 MW would be hydro-electric, 740 MW would be thermal power and 96 MW from various renewable energy sources. Delay in land acquisition, timely preparation of detailed project reports, hindrances in erection of transmission lines and an unfavourable working environment are some of the hurdles delaying the commissioning of these mini power plants. To minimize transmission loss and power theft, smart meters would gradually be installed in the premises of 450,000 consumers.
India topped tenders for power generation capacity globally during the quarter ended 31 December. Top issuers of power plant tenders globally for the quarter in terms of power capacity Solar Energy Corp of India (3,000 MW) from four tenders, Northern Indiana Public Service in the US for 2,600 MW from two tenders and NTPC Ltd at 2,514 MW capacity from nine tenders. Comparing tenders activity in power plant segment in different regions of the globe, Asia-Pacific held the top position with 209 tenders and a share of 71.8 percent during Q4 2019, followed by Europe with 36 tenders and a 12.4 percent share and Middle East and Africa with 29 tenders and a 10 percent share. Globally, however, power plant tenders during Q4, of calendar 2019 saw 291 tenders announced, marking a drop of 28 percent over the last four-quarter average of 404, according to GlobalData’s power industry tenders database.
The distribution segment of India's power sector is experiencing a huge financial stress with debt amount touching a gigantic ₹4.3 tn largely due to delayed payments, issues around tariff rationalization, and constraints emanating from subsidy disbursement, according to a working paper from ADBI. According to the paper, the sector continues to suffer from problems of poor quality of power and reliability of the supply, with provisioning of six hours of power supply becoming the norm rather than the exception in rural areas of the country. A recent government survey has highlighted that more than 50 percent of households in the country receiving less than 12 hours of electricity in a day as well as the poor per capita electricity consumption in the country stands at a meagre 1,149 kWh which is one-third of the global average. According to ADBI, a critical evaluation of the Indian electricity sector policy and legal pronouncements indicates that the regulatory objectives in the power sector affect the achievement of sustainable development outcomes, structured around three dimensions --- economic, environmental and social.
A revised new scheme to revive the beleaguered discoms was not announced in the Union Budget as expected. However a new power sector scheme aimed at better infrastructure, smart meters and private franchisee model for improving power supply in the states is likely to be launched with an estimated capital outlay of ₹2-2.5 tn. The new scheme would replace UDAY, an earlier scheme meant for revival of discoms, that concludes in March 2020. The Centre should have one umbrella scheme instead of multiple schemes for the power sector, and states would have to reduce the losses of discoms to get the benefits under the scheme. The government is planning to integrate electrification programmes Deendayal Upadhyaya Gram Jyoti Yojana and Integrated Power Development Scheme with the new scheme.
About 1.5 mn power sector employees and engineers across the country boycotted work in protest against the Centre’s move to pass the Electricity (Amendment) Bill and other privatisation policies. They also demanded the implementation of old pension scheme. The boycott call was given by NCCOEEE, an umbrella union of all federations of electricity employees and engineers in the country. In Lucknow, scores of employees gathered and raised anti-government slogans during a protest meeting at Shakti Bhawan. Most of the amendments proposed in Electricity Act-2003 and national tariff policy were seen to be against the interests of common consumers. Under the new tariff policy full cost of power will be charged by private company with guaranteed profits from consumers thus raising the bill of consumers. Under this, policy subsidy and cross-subsidy will be phased out in three years. This will raise the cost of electricity for consumers.
Rural and urban domestic consumers drawing around 400 kWh or more of electricity a month in Maharashtra, Madhya Pradesh and West Bengal pay the highest rates in the country, the CEA has estimated. Utilities in Maharashtra, including those in Mumbai, and Madhya Pradesh have witnessed regular tariff revisions by their respective power regulators in comparison to other states as increased costs were passed on. However, in other states, rising costs are not always fully passed on to consumers resulting in suppressed tariffs. Moreover, unlike southern states, utilities in Maharashtra and Madhya Pradesh do not have ready access to cheap hydel power.
The UPPCL increased the electricity tariff to ₹0.66/kWh with effect from 1 January. The sudden change is being attributed to the increase in the price of coal. UPPCL decided to pass on the increase in the power purchase cost due to hike in coal prices to the consumers. It therefore hiked the energy cost from ₹0.04/kWh to ₹0.66/kWh across various categories. This was done by invoking the FPPCA clause under the National Tariff Act. However, following a petition filed by UP power consumers forum, the state’s Electricity Regulatory Commission took cognisance of the matter and found that the calculation for the hike was incorrect. It has thus sent back the matter to UPPCL for correction. UPERC said that the matter is under consideration and would be taken up after the computation is corrected and placed before it for approval. Giving details of the matter, UPPCL said that as per the National Tariff Act, licensees have the right to increase the tariff by 10 percent in case of an increase in fuel cost price on a quarterly basis by invoking the FPPCA till 31 March 2020. UPERC had in September last year approved 8-15 percent tariff hike for different categories of rural and urban consumers. While a hike of 8-12 percent in power tariff had been approved by the UPERC for domestic consumers, electricity prices in industrial areas had increased by 10 percent. Power consumers can now get registered under the ‘easy instalment scheme’ till 31 January. The UPPCL had launched easy instalment scheme in November under which domestic power consumers in urban areas with up to 4 kW load were able to pay their dues in 12 easy instalments while rural consumers can pay pending bills in 24 instalments after registration. UP introduced the easy instalment scheme in November 2019, with an aim to tackle the problem of power dues which is a major issue in UP. Under the scheme, LMV-1 (domestic/residential) category electricity consumers in urban and rural areas (having a load of up to 4 kW) can avail the scheme by simply paying 5 percent of the dues or minimum Rs1,500 (whichever is higher)as first instalment. Domestic consumers of urban areas will get the benefit to pay entire dues in 12 monthly instalments and domestic consumers of rural areas will get the benefit to pay entire dues in 24 monthly instalments and during the period, late payment surcharge penalty on the dues till 31 October will be waived.
The Chandigarh UT electricity department has refused to implement monthly billing system under which nearly 240,000 power consumers residents could have ended up paying less in the city. Shortage of staff and software requirements were cited as the reasons for the rejection. This after the JERC had directed the department to shift to the new billing system. The department further said the work for installation of smart meters is in progress and far from completion — a step that will help in monthly billing. In the petition, the department had also not proposed any hike in power tariff for 2020-21. The department submitted before the JERC as there would be a total surplus of ₹72.3 mn with the department, it has not proposed any power tariff hike. According to the last orders of the JERC, the new tariff would be applicable from 1 June 2019 and remain valid till further orders of the commission. Last time, there was hike in power tariff for 2018-19 financial year. At that time, the JERC had marginally increased rates in domestic and commercial categories and reduced them in the industrial category. In the domestic category, rates were increased in 2018-19 from ₹2.55/kWh to ₹2.75/kWh in the slab of 0-150 units, while there was no change in the rate of ₹4.80/kWh in the slab of 151-400 kWh. In the slab of above 400 kWh the rate was increased from ₹5/kWh to ₹5.20/kWh. Along similar lines, a small increase in the commercial consumer category was also made in 2018-19. In the commercial category, there was no change in the rate of ₹5/kWh in the slab between 0-150 kWh while in slab of 151-400 kWh, the rate was increased from ₹5.20/kWh to ₹5.30/kWh. In above 400 kWh slab, the rate was increased from ₹5.45/kWh to ₹5.60/kWh. Chandigarh residents can continue to avail 1 percent rebate on their electricity bills for making advance payments. The electricity department have made the proposal in the power tariff petition submitted before the JERC for the next financial year 2020-21. Taking JERC’s previous order as base, the UT electricity department has made similar plea for next financial year. In the petition, the UT electricity department has also not proposed any hike in power tariff for 2020-21. The UT electricity department, in its power tariff petition submitted before the JERC, had submitted that there will be total surplus of ₹72.3 mn with the department, therefore the department did not propose any power tariff hike.
Consumers may see a hike in their monthly electric bills this year as BESCOM has proposed a 9-12.8 percent hike in retail supply tariff for low-tension, domestic consumers in areas falling under BBMP, other municipal corporations and urban local bodies. The utility submitted its proposal to the KERC. BESCOM plans to recover ₹58.72 bn revenue deficit from the proposed tariff revision. KERC is expected to take a call after a public hearing. While last year, KERC announced an average hike of 4.8 percent across four slabs for domestic consumers within BESCOM limits, this year, the utility has sought for an increase in two slabs — 101 to 200 kWh and above 200. For both these consumption slabs, BESCOM proposed a hike of ₹1/kWh each — ₹6.75kWh to ₹7.75kWh and ₹7.8/kWh to ₹8.8kWh. The fixed charges payable per month have also been proposed to go up from ₹60 to ₹85 for 1 kW and ₹70 to ₹95 for those using beyond that. As per the tariff order announced by KERC last year, the average increase, including a hike in fixed charges, was ₹0.33/kWh for domestic consumers in BBMP and other urban local body limits.
Mumbai’s two biggest power utilities, AEML and Tata Power Company Ltd, have submitted their tariff proposals to the state power regulator MERC. While AEML has proposed tariff reduction of 1 percent for consumers using between 100 and 300 units per month, Tata Power has proposed a hike of 9 percent for the same category, for the financial year 2020-21. However, even after the reduction AEML’s tariff will continue to be higher for this category of consumers. More than 80 percent of the consumers fall in the 100-300 band. The last date for filing suggestions/objections regarding the proposals is 31 January. The public hearing for AEML will take place on 4 February and Tata Power on 7 February. The new tariff structure will come into force from 1 April. AEML has proposed a reduction of 4 percent in tariff for consumers using below 100 units per month from the existing ₹3.29/kWh to ₹3.15/kWh. In the case of consumers up to 300 units, AEML has proposed to bring down tariff from ₹6.53/kWh to ₹6.50/kWh. For consumers using between 300 and 500 kWh, AEML has proposed an increase of ₹0.03/kWh. The existing tariff for these consumers is ₹7.72/kWh. In the case of consumers with consumption of 500 and above, the company has proposed a hike of 13 percent. The existing tariff for this category of consumers is ₹9.57/kWh. Tata Power proposed to increase tariff for consumers using up to 100 units from the existing ₹1.35/kWh to ₹2.68/kWh – a rise of almost 99 percent. Similarly, it proposed to increase tariff for consumers using up to 300 kWh from the existing ₹4.05/kWh to ₹4.41/kWh, a hike of 9 percent. Adani Group is exploring acquisition of VIPL, a subsidiary of Reliance Power which supplies electricity to Adani Electricity Mumbai. The talks between Adani and Reliance Power are at an early stage. VIPL operates two 300 MW units at Butibori in Maharashtra, but it has not been generating any power since mid-January after CIL stopped supplying coal over an ongoing litigation which is in the Delhi High Court and issues relating to payment. VIPL had shut its first unit of 300 MW before that. The spat has forced Adani Electricity to buy power from the open market to meet its obligation to its 3 mn customers in the city. Adani has been procuring power from the market at ₹3.50-4/kWh. In comparison, VIPL was charging it ₹4.38/kWh which could go up to ₹5.50/kWh if it is allowed to pass on the entire cost of coal procurement. Any potential acquisition will be guided by Adani Electricity’s internal target of reducing the average cost of power to about ₹4/kWh.
Police used water cannons to stop protests against the hike in power tariff in Punjab. The main opposition party also sought scrapping of power purchase agreements signed during previous regime with private plants. Power rates in Punjab were increased by 36 paise/kWh with effect from 1 January for domestic consumers. The party leaders alleged that power consumers were being forced to pay between ₹9/kWh and ₹12/kWh which was "much higher" as compared to electricity rates in other states.
The CESU of Odisha has said it will commence its power disconnection drive in a phased manner as the company had a pending arrear of ₹19.71 bn by end of November last year. The power distribution company has identified consumers who did not make payments despite several notices in 11,397 villages to disconnect their power connections. As many as 413 squads have been formed to carry out the power disconnection exercise in nine coastal districts under the jurisdiction of CESU. In December 2019, the CESU had announced the arrear collection-cum-disconnection drive from 16 January 2020.
Power consumers and representatives of consumer forums have decried the MSEDCL’s proposal to increase the power tariff stating that rather than putting in place efficient mechanism to collect the dues from defaulters, the state electricity board was trying to recover the revenue gap from consumers. The previous government had assured the power consumers that the hike in power tariff would be slightly reduced but the MSEDCL did not budge from its decision. Proposing the increase in tariff— both in fixed charge and the tariff per unit—in the multi-year tariff proposal presented before the MERC, the MSEDCL has claimed that the hike was in the range of 1-5 percent. However, consumer outfits claim that the MSEDCL’s proposal would take the power tariff up by 20 percent from the very first year. The consumer associations have called upon all consumers to write to the MERC against the proposed power tariff hike.
Employees being recruited in the state’s electricity firms — UPCL, Power Transmission Corp Ltd and Uttarakhand Jal Vidyut Nigam Ltd — after 1 April 2020 will not get the benefits of subsidised electricity. Besides, authorities have also decided to put a cap on subsidised electricity to employees and officers. The Uttarakhand high court had sought a reply from UPCL over the subsidised electricity given to the power department employees. As per the change, the Class IV employee would get 6,000 units of subsidised power supply, whereas the cap for others has been set for 9,000 units per annum. If usage is beyond the set cap, normal charges will be applicable for power department employees.
Power supply to major parts of the city snapped after Chinese ‘manjha’ played havoc with the power distribution system. Jaipur discom said power supply from the 220 kV Nala power house was disrupted, resulting in power outage and preventing supply of power from feeders to major parts of the city in the afternoon. The old city and neighbouring areas were the most affected. All feeders from the power house were affected. Some feeders were supplied power from alternative sources. In some places, local disturbances also resulted in supply disruption. Most of the disruptions occurred due to Chinese ‘manjha’, which have metallic and plastic coating, that got entangled in power lines, resulting in short circuits and supply failure. Incidentally, the Chinese ‘manjha’ has been banned in the state. But the administration failed to enforce the ban effectively.
The ISEP at the Johns Hopkins University announced it has signed an MoU with the CUJ, India. The Initiative and CUJ will collaborate for an initial period of 3 years till November 2022 to primarily identify possible research, training, and education activities in India, specifically in Jharkhand for power sector improvement. ISEP and CUJ will collectively work to strengthen the governance process in the power sector by addressing the issues of policymaking. The Initiative and CUJ will convene distribution companies, government officials and other stakeholders to identify priorities for power sector improvements. The two parties will also together try to understand the best practices that could be implemented in the state’s power sector and work closely with decision makers, non-governmental organisations, and other stakeholders.
Sterlite Power said it has inked an exclusive agreement with the US -based Smart Wires to bring SmartValve to Indian market which will enable resourceful grid management. This cutting-edge technology is an intelligent 'valve' that will allow utilities to optimally utilise its existing transmission capacity and enhance grid flexibility, the company said. Power networks in India have been facing major transmission congestion challenges due to exponential growth in demand for power and rapid urbanisation, the company said.
India’s electricity grid operators will have to install firewalls and other measures used by companies to avert an attack on their information technology systems and check rising hacking incidents of power networks across the world. Grid operators and regulatory agencies will need to have a continuity plan handy in the event of a cyber-attack, according to draft rules published by the Central Electricity Regulatory Commission. The report comes barely months after the nation’s monopoly nuclear power producer admitted its information system had been breached, underscoring the need for more action to protect critical installations. Energy networks across the world have been key targets for hackers, prodding governments to take safeguard measures. The draft report advises central and state transmission utilities and load dispatch centers to ensure protection of sensitive data and identify reserve transmission capacities that can take over in case of a disruption apart from regular monitoring of risks. It also recommends that these bodies prioritize resources and allocate adequate workforce for online security. To deal with malware, India protects its central power grid through multiple firewalls and has isolated it from office networks.
South Africa’s struggling state electricity firm Eskom said it would cut up to 2,000 MW of power from the national grid overnight, after a conveyor belt failure at its Medupi coal-fired power station. The cash-strapped utility has been battling to keep the lights on, despite low electricity demand over the Christmas and New Year public holidays. It last implemented power cuts in mid-December. Almost 16,000 MW of Eskom’s 44,000 MW nominal generating capacity was offline because of plant breakdowns. It said that a number of generating units were being brought back online after repairs and maintenance. Power cuts by state utility Eskom cost the South African economy up to 120 bn rand ($8.3 bn) last year and will probably persist for the next two to three years, the CSIR research showed. The power cuts are one of the biggest challenges facing the new government as he tries to revive investor confidence in Africa’s most industrialised economy. The government has promised to break up Eskom to make it more efficient and granted it a series of mammoth bailouts to stabilise its finances, but its coal-fired power plants keep breaking down after years of mismanagement. The CSIR urged the government to move swiftly to ease regulations governing “self-generation” of electricity by companies and households as a way to minimise power cuts in 2020. Other government initiatives, such as giving independent power producers the go-ahead to build new plants, could only help reduce the scale of power cuts from 2021 if procurement processes are expedited or from 2022 under normal circumstances, the research showed.
Strikes by workers protesting against plans to change France’s pension system reduced power generation by more than 3 GW, including 1.8 GW at hydro power stations, data from RTE and state-controlled power group EDF showed. Electricity demand is forecast at around 81 GW due to cold weather. France was a net power importer during the morning peak demand period, the data showed. Poland may set aside around 3 bn zlotys ($792 mn) in its 2021 budget to compensate households for rising power prices in 2020. Poland’s energy regulator URE has approved requests by power companies to hike bills by around 10.5-13 percent per month in 2020, but the ruling nationalists Law and Justice (PiS) have vowed to protect households from rising costs caused by increasing carbon emission costs and surging wholesale power prices. Households would be able to apply for compensation from the government for increases in their electricity bills at the end of 2020. In 2019 prices were capped thanks to a cut in the tax rate consumers pay on electricity and the so-called transitional fee, a component of electricity bills.
Israel’s state-owned electric company said it was ending power cuts to the occupied West Bank after the Palestinians’ main power distributor paid off a chunk of debt. IEC began sporadic, three-hour power cuts to press for payment of some $519 mn owed by the JDECO. Palestinians in the West Bank rely on IEC for over 95 percent of their electricity supply. The cuts led to power outages in the cities of Ramallah and Bethlehem, affecting an estimated 130,000 people, according to JDECO. JDECO buys electricity from IEC and then sells it to customers in the West Bank, territory Israel captured in the 1967 Middle East war and where the PA has limited self-rule under interim peace accords.
Abu Dhabi-based sovereign investor Mubadala Investment Company has inked an agreement with Uzbekistan’s Ministry of Investment and Foreign Trade, as well as JSC Thermal Power Plants of the Republic of Uzbekistan, to establish a roadmap for the implementation of a transaction, which will include the acquisition, development, financing, and operation of the Talimarjan Power Complex.
Nepal’s TIA has reported facing electricity shortage, with authorities urging all stakeholders to make sure that power being supplied to the airport was utilised in an optimum manner. A notice issued by the airport management said that excessive power consumption at TIA for trivial purposes was directly affecting the communication, navigational aids and surveillance equipment needed for flight operation. As part of its Visit Nepal 2020 campaign, the government of the Himalayan nation has invested 240 mn Nepalese rupees to upgrade TIA to a boutique airport. But lack of adequate electricity supply at TIA may affect the campaign that aims to double the annual tourist arrivals.
| CEA: Central Electricity Authority, kWh: kilowatt hour, TANGEDCO: Tamil Nadu Generation and Distribution Corp Ltd, MW: megawatt, GW: gigawatt, mn: million, bn: billion, tn: trillion, discom: distribution company, APL: Above Poverty Line, US: United States, Q4: fourth quarter, ADBI: Asian Development Bank Institute, UDAY: Ujwal Discom Assurance Yojana, NCCOEEE: National Coordination Committee of Electricity Employees and Engineers, UP: Uttar Pradesh, UPPCL: UP Power Corp Ltd, FPPCA: fuel and power purchase cost adjustment, UPERC: UP Electricity Regulatory Commission, kW: kilowatt, UT: Union Territory, JERC: Joint Electricity Regulatory Commission, BESCOM: Bangalore Electricity Supply Company, KERC Karnataka Electricity Regulatory Commission, AEML: Adani Electricity Mumbai Ltd, MERC: Maharashtra Electricity Regulatory Commission, VIPL: Vidarbha Industries Power Ltd, CIL: Coal India Ltd, CESU: Central Electricity Supply Utility, MSEDCL: Maharashtra State Electricity Distribution Company Ltd, UPCL: Uttarakhand Power Corp Ltd, kV: kilovolt, ISEP: Initiative for Sustainable Energy Policy, MoU: Memorandum of Understanding, CUJ: Central University of Jharkhand, US: United States, CSIR: Council for Scientific and Industrial Research, IEC: Israel Electric Corp, JDECO: Jerusalem District Electricity Company, TIA: Tribhuvan International Airport |
2 February. After exempting foreign companies, the Budget 2020-21 has exempted the income of Indian Strategic Petroleum Reserves Ltd (ISPRL) from taxes on transaction of crude oil stored in the underground caverns it built as country’s strategic stockpile. In 2017, the government had exempted foreign companies from paying income tax on the sale of oil they store in India’s strategic oil reserves. According to a budget 2020-21 document, the income of ISPRL will be exempt from taxes on the transaction of crude oil stored in its strategic caverns, provided the company replenishes the removed fuel within three years. The Budget also abolished import tax on very low sulphur fuel oil (VLSFO) used by ships to reduce costs for local shipping companies. This relief is in line with exemptions offered to other bunker fuels. In a bid to insulate the country from volatility in the global oil market, India has built underground storages in rock caverns at Visakhapatnam (1.33 mt), Mangalore (1.5 mt) and Padur (2.5 mt). Two more underground crude oil storages at Chandikhol in Odisha and Bikaner in Rajasthan, with a combined capacity to stock 12 mt of oil, are planned to be built. The storage at Chandikhol will be an underground rock cavern while the one at Bikaner will be an underground salt cavern. ADNOC (Abu Dhabi National Oil Company) and Saudi Aramco have signed agreements to hire capacity in India’s maiden strategic oil storages. India is 83 percent dependent on imports to meet its crude oil needs. Under the agreements, India will have the first right to use the stored oil in case of an emergency, while ADNOC and Aramco would use the facility to store oil for trading purposes.
Source: Business Standard
1 February. The Budget has proposed a capital outlay of Rs985.2 bn for oil and gas companies for 2020-21, a four percent increase over the revised estimate for 2019-20. According to the Expenditure Budget document, the Exploration and Production (E&P) segment’s overall capital outlay is seen increasing 7.40 percent to Rs520.19 bn in 2020-21 from Rs484.31 bn in the Revised Estimate for current fiscal. The Refining and Marketing segment has witnessed a 2.49 percent decline in capital outlay at Rs416.54 bn as compared to the revised estimate of Rs427.22 bn for 2019-20. The capital outlay for Oil and Natural Gas Corp (ONGC), the biggest spender among oil and gas Public Sector Undertakings (PSUs), increased 2 percent to Rs325.02 bn for 2020-21 from Rs 318.96 bn likely to be spent this fiscal. For Indian Oil Corp (IOC), the country’s largest fuel retailer and the second-biggest spender among oil and gas PSUs, capital outlay is budgeted to increase to Rs262.33 bn in 2020-21 from the revised estimate of Rs248.95 bn for current fiscal. Also, the capital outlay for Hindustan Petroleum Corp Ltd (HPCL) has been flat at Rs115 bn for 2020-21. The government has also budgeted for a 14 percent increase in the capital outlay for Bharat Petroleum Corp Ltd (BPCL) at Rs90 bn in the next financial year, as against the revised estimate of expenditure at Rs79 bn for 2019-20. Capital expenditure by Oil India Ltd (OIL), the second-largest state-owned petroleum explorer, has been pegged at Rs38.77 bn for FY21, a 5.4 percent increase. Similarly, GAIL (India) Ltd, the state-run natural gas utility, is expected to spend Rs54.12 bn, a marginal increase over Rs53.81 bn to be spent in the current fiscal. The government has allocated Rs409.15 bn as petroleum subsidy for the next financial year, a 6 percent increase from Rs385.69 bn allocated for the current fiscal.
Source: The Economic Times
31 January. India’s crude oil and natural gas production is expected to decline in financial year 2019-2020 (FY20), according to calculations and projections made by the Economic Survey 2019-2020. Oil production is projected to decline 5 percent to 32.6 million tonnes (mt) in the current financial year as compared to 34.2 mt produced in 2018-19. This would be the lowest recorded production in more than eight years, according to oil ministry data. The survey noted that the proven reserves of crude oil have decreased since 2014, with steeper fall in onshore reserves. However, the decline in reserves till 2018 has seen a reversal in 2019, with reserves rising to 619 mt in 2019 from 594 mt in 2018. The surge in reserves of crude oil in 2019 is accompanied by corresponding increase in onshore and offshore reserves, with onshore reserves rising at a steeper rate. According to the survey, the share of private and joint ventures (JVs) in onshore crude oil reserves were falling till 2018, but has seen an uptick in 2019. In case of offshore reserves of crude oil, the participation of private sector is seen steadily rising, with the share of private and JV companies reaching 19.5 percent in 2019. With the government’s aim of reducing India’s oil import dependence by 10 percent by 2022 not picking up pace, Oil Minister Dharmendra Pradhan said that the oil ministry is developing a new strategy to achieve the target.
Source: The Economic Times
30 January. With the government’s aim of reducing India’s oil import dependence by 10 percent by 2022 not picking up pace, Oil Minister Dharmendra Pradhan said his ministry is developing a new strategy to achieve the target. India’s oil import dependence has steadily increased to 85 percent during the April-December period of 2019-2020 as compared to 78.3 percent in financial year 2014-2015, according to data sourced from the ministry. The increase in oil import dependence is mainly attributed to the decline in domestic oil production, which fell to 34.2 million tonnes (mt) in 2018-2019 from 37.5 mt in 2014-2015. In the April-December period of the current financial year (2019-20), the country’s domestic crude oil production declined 6 percent to 24.4 mt. Pradhan had in December last year said the oil ministry expects natural gas production to increase significantly from the current levels. However, domestic oil production is expected to plateau. In a bid to curb the country’s rising dependence on imported crude, the oil ministry has been trying to push for higher adoption of natural gas and alternative fuels to displace the demand of crude oil.
Source: The Economic Times
4 February. India’s Essar Steel is seeking 36 liquefied natural gas (LNG) cargoes for delivery over 2021 to 2023. The tender closes on 5 February and remains valid until 7 February. This is likely a reissue of an earlier tender by the company in November last year for the same volumes and delivery period, though this could not immediately be confirmed.
Source: Reuters
4 February. Reliance Industries Ltd (RIL) and British multinational oil and gas company BP Plc have said their joint venture completed the safe cessation of production in a planned manner from the D1 D3 field in block KG D6 off the east coast of India. The D1 D3 field was India’s first deepwater gas field to be put on production in April 2009. Through innovation and application of first-of-their-kind solutions, the field’s life was extended for almost five years, to February 2020, maximising the recovery from the field. The KG D6 block has so far produced an overall 3 trillion cubic feet equivalent (TCFe) resulting in energy import savings of over $30 bn. These fields also established several global benchmarks in terms of operational performance including 99.9 percent uptime and 100 percent incident-free operations. The JV (joint venture) has committed an additional $5 bn (Rs350 bn) of investments towards monetising about 3 TCFe (about 500 mn barrels of oil equivalent) reserves from three projects -- R cluster, satellite cluster and MJ fields. These projects will utilise the existing gas production infrastructure. Further, this infrastructure can act as a hub for the development of any discovery from contiguous areas. The first-gas from these fields is expected in mid-2020. The peak production from these three fields is expected to reach 1 billion cubic feet equivalent (BCFe) per day which is about 15 percent of the then envisaged India's demand.
Source: Reuters
3 February. India’s top gas importer Petronet LNG and US (United States) liquefied natural gas (LNG) developer Tellurian Inc are preparing to sign a $2.5 bn deal during President Donald Trump’s maiden visit to New Delhi. India and the US have built close political and security ties and want to strengthen trade links, with Trump aiming to boost energy supplies to India, the world’s third biggest oil importer. Petronet will invest the money over a five-year period in Tellurian’s proposed $27.5 bn Driftwood LNG export project in Louisiana and the deal will give Petronet an equity stake in the project and rights for up to 5 million tonnes a year of LNG. The delivered price of gas to India would be below $6 per million metric British thermal units (mmBtu). This will work out to about 30 percent cheaper than the country’s current long-term deals with Qatar. The two companies signed a preliminary non-binding deal in September last year, when Prime Minister Narendra Modi visited the US as the two nations want to deepen their energy and trade relations. India wants to raise the share of gas in its energy mix to 15 percent by 2030 from the current 6.2 percent as it battles high levels of pollution in many big cities, including the capital New Delhi.
Source: Reuters
1 February. To facilitate better price discovery of domestically produced natural gas, the government plans to undertake further reforms to make natural gas pricing more transparent, Finance Minister Nirmala Sitharaman said while unveiling the union budget 2020. The Minister said that national gas grid will be expanded to 27,000 kilometre (km) from 16,200 km currently. Domestically produced natural gas currently is not determined by the demand-supply dynamics. The country currently uses a formula to price domestically produced natural gas, revised bi-annually. The country’s upstream players have on many occasions voiced concerns on the country’s natural gas pricing formula for domestically produced gas and said that low prices for domestically produced gas is acting as a deterrent for monetisation of various gas fields. ONGC (Oil and Natural Gas Corp) said that low gas prices have resulted in the company bearing losses of more than Rs51 bn between financial year 2017-2019. In a bid to incentivise production of natural gas the government had in March 2016 offered pricing freedom for gas produced from deep water, ultra-deep water and high pressure-high temperature areas. The government has set a target to increase the share of natural gas in the country’s energy basket to 15 percent by 2030.
Source: The Economic Times
1 February. Maharashtra Natural Gas Ltd (MNGL) said that they will provide compressed natural gas (CNG) for 200 city buses by March-end. According to MNGL, CNG stations will be operational at six locations in the city. These locations have been leased out by the Nashik Municipal Corp (NMC). MNGL’s promises came during a joint meeting of officials from MNGL and NMC. Initially, MNGL will transport liquefied natural gas (LNG) through tankers to the city and then convert it to CNG. LNG will be transported by roadways from the nearest import storage location (Dahej) and will be stored in containers in Nashik. The six locations identified for the proposed CNG stations include Adgaon, NMC’s fire brigade station in Panchavati, Truck Terminus at Chehedi, Pathardi, Tapovan and Sinnar Phata. MNGL has already signed a lease agreement with the NMC for first four sites while agreement for the remaining two sites — Tapovan and Sinnar Phata — will be signed. Once the feeder pipeline between Mahaskal-Titwala and Nashik is laid, the LNG station would be decommissioned since natural gas would be transported from the transmission pipelines through the feeder pipelines.
Source: The Economic Times
3 February. Coal stocks at power plants peaked to 34.25 million tonnes (mt) on 26 January, equivalent to 19 days' consumption, and up by 77 percent as against 19.36 mt, equivalent to 12 days' consumption at the same time last year. Thrust has been also given to augment coal supplies to non-power sector by holding regular auction for coal linkages where the consumers have been given the flexibility to choose nearest mine, quality (grade, size) etc. To facilitate easy availability of coal to all the sectors, Coal Companies are also offering increased coal under spot and exclusive e-auction. Union Coal Minister Pralhad Joshi said. The Minister informed that various steps have been taken to ensure the easy and adequate availability of coal to every coal dependent industries/Power Sector.
Source: Business Standard
2 February. India’s coal import increased by 7.6 percent to 185.88 million tonnes (mt) in the April-December period of the current fiscal. Coal imports in December rose by 13.3 percent to 20.52 mt compared to 18.10 mt in the year-ago month, according to provisional data by mjunction services. Non-coking coal imports were at 14.21 mt in December 2019 against 12.5 mt in December 2018. Coking coal imports were at 4.47 mt against 3.76 mt imported in December 2018. During the April-December period, coal and coke imports were at 185.88 mt, up by 7.66 percent compared to 172.65 mt in the same period last year.
Source: The Economic Times
2 February. The Budget allocation for the coal ministry has registered a decline of 5.4 percent to Rs8.82 bn in 2020-21, from Rs9.33 bn in 2019-20. The decline has been over the revised estimates of the 2019-20 Budget, according to Budget documents. While the expenditure was at Rs11.59 bn for 2019-20, in case of 2018-19 (actual) it was Rs7.08 bn, it said. The expenditure budget of Rs8.82 bn in the 2020-21, includes Rs8.19 bn on central sector schemes/projects and Rs223.5 mn on Coal Mines Pension Scheme. The investment in public enterprises, including Coal India Ltd, has increased from Rs184.67 bn in budget 2020-21, over the revised estimate of Rs181.21 bn in 2019-20.
Source: The Economic Times
1 February. The Union coal ministry has issued a stern warning to the Goa government saying that Goa could lose a coal block for the second time if it does not complete the formalities to take over the Dongri Tal II coal block at Singrauli in Madhya Pradesh. Industries Minister Vishwajit Rane has sought a grace period of 100 days to arrange the funds required to pay the performance guarantee for the coal block that Goa Industrial Development Corp (GIDC) plans to operate. Rane had earlier announced that the state would sign the agreement for this block by 30 October. The corporation has already identified a committee to spearhead the process to formally utilise the coal block, which was allocated to the state through a bidding process. The corporation intended to rope in validated consultants to help the state with the coal block utilisation and with the auction of the industrial land returned by the special economic zone promoters. The Dongri Tal II coal block at Singrauli was allotted to Goa as part of the fifth tranche of allotment by the coal ministry. However, the cash-strapped corporation needs to pay Rs1.96 bn to exploit the coal block. Coal mines have been allotted to state governments for sale of coal under the Coal Mines (Special Provisions) Act, 2015. The Centre said it will accept upfront payments in three instalments from successful bidders, along with the performance guarantee — equivalent to a year’s royalty — prior to the formal signing of the Coal Mine Development and Production Agreement (CMDPA). The corporation had also applied to Coal India Ltd for yet another coal block as part of the sixth tranche of coal mines allocation.
Source: The Economic Times
29 January. Coal ministry additional secretary Vinod Kumar Tiwari said that commercial mining of coal will be a very important step in modernizing the coal sector in the country. He said that the coal mining framework will also secure India’s long-term economic growth. Commercial coal mining and its associated competitive pressures will bring in new capabilities that will help all the organizations including the existing and also the prospective ones, he said. Private sector investments for commercial coal mines will also have a significant role to play in realizing Prime Minister Narendra Modi’s vision of making India a $5 tn economy. He said that commercial coal mining will help cater to the demand and supply gap of coal, a significant portion of which is currently imported. The ministry will consider suggestions from stakeholders before finalizing the bidding process.
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< style="color: #ffffff">QuIck Comment < style="color: #ffffff">Smart prepaid metering across the country will reduce commercial losses! < style="color: #ffffff">Good! |
Source: Business Standard
3 February. India’s electricity supply rose 3.25 percent during the month of January after five straight months of decline, provisional government data showed, in a relief for power producers. Power supply rose to 106.36 bn units in January, up from 103.01 bn units last year, an analysis of daily load despatch data from Power System Operation Corp Ltd (POSOCO) showed. India’s Central Electricity Authority (CEA), an arm of the federal power ministry, is expected to release official data on power demand later this month. POSOCO releases provisional load despatch data every day. Higher electricity supply could mean a rise in power demand, as electricity deficit in India is marginal. Electricity demand is seen by economists as an important indicator of industrial output and a deceleration could point to a further slowdown. However, the potential rise would be from a low base, as electricity demand grew at the slowest pace in January 2019 in nearly two years, CEA data showed. India’s annual electricity demand in 2019 grew at its slowest pace in six years. Electricity supply fell 0.4 percent in December, 4.2 percent in November and 12.8 percent in October, according to the CEA. Annual consumption of electricity by industry accounts for more than two-fifths of India’s annual electricity consumption, according to government data, with residences accounting for nearly a quarter and commercial establishments for another 8.5 percent.
Source: Reuters
3 February. The proposal for smart prepaid metering across the country in three years, announced in the Union Budget, has been hailed by the power industry. But the initiative is not new. The power ministry has been planning it for the past two years, but with limited success. At the same time, many hurdles await the ambitious plan. Union Power Minister R K Singh said his ministry was planning to convert all meters in the country to smart prepaid meters. Singh had said he would mandate state-owned power distribution companies (discoms) to switch to smart prepaid meters. Since then, 400,000 smart meters have been installed to date in Uttar Pradesh, Delhi, Haryana, Bihar, and Andhra Pradesh. These were by Energy Efficiency Services, which is mandated for smart meters tendering to private companies. Close to 5 mn were tendered in the first round. Responding to the announcement in the Budget, the Indian Electrical and Electronics Manufacturers Association (IEEMA) said this is a positive step and the industry will fully cooperate with the government in meeting the target. A smart prepaid meter has a modem (communication device) and a remote switch by which demand, supply, and billing can be monitored and controlled remotely. The data from the meter is collected in a cloud server. This reduces energy theft, improves billing and bill collection. It also helps discoms collect the data of consumer demand patterns, which, in turn, can be used to plan supply.
Source: Business Standard
1 February. Union Power Minister R K Singh said the government will soon bring out schemes for discom (distribution company) revival, liquidation of discom dues and amend the Electricity Act to introduce hefty penalties on reneging of any kind of contract. Singh said Power Finance Corp will set up an alternate investment fund to assist state discoms repay the over Rs835 bn dues to thermal power plants. He said his ministry is working on a schedule for repayment of the discom dues from distribution companies to power plants over a period of six months. The quick amendment to Electricity Act would ensure that discoms and generators do not renege on contracts or payments in the future. Hailing the Union Budget 2020, he said the expanded Kusum scheme to solarise agriculture pumps will make agriculture diesel free and reduce cost of irrigation to farmers to one-fourth or one-fifth of the present costs. The government will assist the discoms as long as they are adhering to the loss reduction trajectories. Also, the deviating distribution companies will not get any financing from Power Finance Corp and Rural Electrification Corp.
Source: The Economic Times
29 January. Now, you can pay your electricity bills while buying ration at fair price shops in your neighbourhood. This is part of the energy department’s innovative strategy to swiftly mop up revenue, particularly in rural areas, by making ration shops double up as bill payment kiosks. Once executed, the proposal will allow approximately 80,000 FPS (68,000 in rural areas and 12,000 in urban areas) to act as one-stop bill payment centres. According to department’s proposal, the collection process will come with incentives to FPS operators. UPPCL (Uttar Pradesh Power Corp Ltd) proposed that the fair price shops would receive one percent of the amount paid in every bill. The corporation has fixed the upper limit of Rs500 per bill. UPPCL’s move to rope in multiple agencies for collection of electricity bills comes in the backdrop of massive power arrears of around Rs820 bn, which have piled up over 20 years since the erstwhile UPSEB (Uttar Pradesh State Electricity Board) was disbanded to form three companies relating to power generation, transmission and distribution system in the state. A major contributor has been schemes like Deendayal Updhayay Rural Electrification Scheme and Saubhagya, which envisages free power connection to rural households. At the same time, cost of power has risen by 15 percent because of the increase in prices of coal and oil.
Source: The Economic Times
3 February. Solar power developers in India are crying foul over the government’s move to raise tariffs on imports of green energy equipment such as solar cells and modules in the budget. The step is aimed at driving local manufacturing of such equipment and discouraging low-quality Chinese imports but companies believe the tariff increase made through an enabling mechanism in the budget will hurt their business. Once a separate notification is issued, a new duty structure enabling a basic customs duty (BCD) of 20 percent on cells and modules will come into effect. Such equipment earlier did not attract any BCD. The fast-growing domestic market for solar components is dominated by Chinese companies due to their competitive pricing. A surge in imports led the National Democratic Alliance (NDA) government in its previous term to impose a safeguard duty from 30 July 2018 on solar cells and modules imported from China and Malaysia. This duty will expire in July. India, the world’s third-largest energy consumer after the US and China, has a manufacturing capacity of 3 GW for solar cells and imported $2.16 bn worth of solar photovoltaic cells, panels, and modules in 2018-19. India is running what will become the world’s largest clean energy programme with an aim of having 175 GW of clean energy capacity by 2022 as part of its global climate change commitments. It plans to add 100 GW of solar capacity by 2022, including 40 GW from rooftop projects.
Source: Livemint
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< style="color: #ffffff">QuIck Comment < style="color: #ffffff">Curtailing renewable power should be an economic and not a political decision! < style="color: #ffffff">Ugly! |
3 February. Nuclear Power Corp of India (NPCIL) is likely to spend Rs145.75 bn next financial year, a 22 percent jump over the capital expenditure of Rs118.9 bn in the current fiscal, according to the expenditure budget documents for 2020-21 tabled in Parliament. Total investment by the central Public Sector Undertakings (PSUs) under the aegis of the Department of Atomic Energy is likely to stand at Rs148.51 bn in the financial year ending March 2021. NPCIL alone accounts for 98 percent of that planned spending. Major NPCIL projects currently under construction include Unit-3 and Unit-4 of the Pressurised Heavy Water Reactor (PHWR) at Kakrapar atomic power station, Gujarat. Both the units are of 700 MW capacity. The construction of Unit-3 is at an advanced stage and most of the equipment have been received and erected at the site. Commissioning activities have commenced and the plant is expected to be operational very soon, the company said. For Unit-4, civil works are nearing completion and many components are being progressively received and erected. The expected date of commercial operation for the Unit is December 2020. The company is also commissioning two units of 700 MW capacity each at the Rajasthan atomic power project. The expected date of commercial operation for Unit-7 is December 2020 while Unit-8 is likely to be commissioned in December 2021. NPCIL is also planning to set up Light Water Reactor Unit-3 and Unit-4 of Kudankulam nuclear power project of 1,000 MW capacity. The projects are expected to be operational by March 2023 and November 2023, respectively. India is planning to add around 20,000 MW nuclear power generation capacity over the next decade.
Source: The Economic Times
3 February. The Andhra Pradesh High Court has directed the central new and renewable energy ministry to form an expert committee to look into whether the Andhra government has been curtailing wind and solar power in the state. The committee will comprise of technical experts from Central Electricity Authority (CEA) and Power System Operation Corp, the court said while hearing contempt of court petitions filed by renewable energy developers against state authorities. All the large renewable energy developers had filed contempt petitions before the High Court, alleging that distribution companies in the state have not followed the court’s direction in September last year asking them not to curtail renewable power.
Source: The Economic Times
2 February. All India Power Engineers Federation (AIPEF) warned that thermal power plants generating 2,500 MW in Uttar Pradesh (UP) would be closed down if the energy sector proposals of the Union Budget 2020-21 were implemented. AIPEF chairman Shailendra Dubey has urged Chief Minister Yogi Adityanath to urgently intervene in the matter and save UP from an “unprecedented” power crisis. He said that the Union Budget had proposed to shut down thermal power units generating flue gas beyond the environmental norms, and to utilise their land for other purposes. Dubey claimed that going by budgetary proposals, three 210 MW units each of Anpara A thermal plant; two 500 MW units each of Anpara B; five 200 MW units each of Obra; two 110 MW units each of Parichha; and two 110 MW units each of Harduaganj thermal power plants totalling nearly 2,500 MW would have to be shut completely.
Source: Business Standard
2 February. The government announced removal of 20 percent import duty on solar cells and panels in the Budget, with immediate effect. According to the Budget documents, the customs duty on solar cells and solar cells assembled in modules or made up into panels was reduced from 20 percent to zero percent. This assumes significance in view of India’s ambitious target of adding 100 GW of solar energy by 2022. India has already achieved installation of 34 GW of solar energy in the country.
Source: The Economic Times
1 February. India aims to boost solar power generation by encouraging the installation of panels along rail tracks and on barren land, the Finance Minister Nirmala Sitharaman said as the country looks to cut its carbon footprint and accelerate clean energy production. Looking to expedite clean energy as some coal-fired power plants face closure, Asia's third-largest economy has set a target to raise renewable energy capacity to 175 GW by 2022. Its renewable capacity rose 16 percent to 85.9 GW in 2019, while coal-fired capacity rose 3.9 percent to 198.5 GW. She said a proposal is under consideration to set up large solar power capacity alongside rail tracks and raised the outlay for the renewable energy ministry by 48 percent for 2020/21.
Source: Business Standard
31 January. The government should look at incentivising exports of wind turbines by increasing the discount available for companies on export duty to 5 percent from the existing 2 percent under the Merchandise Export from India Scheme (MEIS). The centre had launched MEIS in 2015 which allows incentives to exporters at a specified rate which varies from product to product and from country to country. The percentage of incentives varies from 2 percent to 5 percent. Indian Wind Turbine Manufacturers Association said that India has a wind energy potential of 302 GW at a hub height of 100 metre.
Source: The Economic Times
31 January. The Ministry for New and Renewable Energy (MNRE) issued a clarification regarding the second phase of the solar rooftop programme, for which it provides Central Financial Assistance (CFA). Meant for the residential sector, the CFA is provided at a 40 percent of the benchmark cost, or the cost discovered through the transparent bidding by the implementing agency- whichever is lower for rooftop systems. The CFA is applicable up to a capacity of 3 kilowatt (kW). For a total
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< style="color: #ffffff">QuIck Comment < style="color: #ffffff">Coal plant penalties may be passed on to consumers as higher tariff! < style="color: #ffffff">Bad! |
system capacity beyond 3 kW but up to 10 kW, CFA is provided at 20 percent of the benchmark cost, or again through transparent bidding. For group housing societies (GHS) or residential welfare associations (RWA), the CFA will be limited to 20 percent for solar rooftop plants for supply of power to common facilities. The MNRE said that the distribution companies (discoms) should be prepared for quality measures as prescribed, and quality checks be conducted if deemed necessary by the ministry. The phase II of the solar rooftop programmed was initiated in August last year, with an aim of achieving cumulative capacity of 40,000 MW through solar rooftop projects by 2022.
Source: The Economic Times
31 January. India has embarked on an ambitious target of having 450 GW of renewable energy by 2030 and also provide 17 lakh solar pumps to farmers under Pradhan Mantri-Kusum Yojana in coming days to capitalise on this clean resource, President Ram Nath Kovind said. The country is already working on the target of having 175 GW of renewable energy by 2022 which includes 100 GW of solar and 60 GW of wind energy. As of December 2019, 86 GW of renewable energy capacity has already been achieved. This includes 34 GW of solar and 38 GW of wind energy. Besides, around 36 GW of clean energy is under installation and about 35 GW is under bidding stage. He noted that under the second phase of the solar roof top programme, the target is to generate 38 GW of electricity. In September last year, Prime Minister Narendra Modi had announced doubling India’s non-fossil fuel target to 450 GW at Climate Action Summit at UN (United Nations) headquarters.
Source: Business Standard
29 January. Authorities are assessing how seriously to punish the operators of coal-fired plants around New Delhi that missed a year-end deadline to fit equipment to curb harmful emissions, the federal pollution regulator said. Under a planned phase-in of higher standards, some plants were given until the end of December, while others had until the end of 2022. Most plants so far have missed their deadlines. The Central Pollution Control Board (CPCB) said action taken against non-compliant power plants will take into consideration any efforts made so far. The regulator warned last year coal-fired plants could be shut down for failing to meet deadlines. Only one out of the 11 plants around New Delhi has installed equipment to cut emissions of sulfur oxides. Four of the remaining 10 plants have awarded bids for retrofitting the technology, the Central Electricity Authority said. The country’s power ministry has asked for coal-fired power plants around New Delhi to be given more time to install equipment to reduce emissions, after the year-end deadline for action passed.
Source: Reuters
29 January. Union Environment Minister Prakash Javadekar said it is the responsibility of developed nations to reduce annual carbon emissions first but they are taking no action. Speaking at the 20th edition of the World Sustainable Development Summit (WSDS) being held at the India Habitat Centre, he said since 1990, "the world has reduced annual carbon emissions only by half percent and a lot needs to be done". He said developing countries should have received $1 tn in assistance from developed countries as per commitments made in Copenhagen nearly a decade ago.
Source: Business Standard
4 February. China announced it will cut retail ceiling prices for gasoline by 420 yuan ($60.07) per tonne and diesel by 405 yuan, in the first price reduction this year to track falling global oil prices. The cuts will represent about 5 percent on both gasoline and diesel prices.
Source: Reuters
3 February. Iranian Oil Minister Bijan Zanganeh said that the spread of China’s new coronavirus had hit oil demand and called for an effort to stabilize oil prices. Zanganeh said Iran would agree to an earlier OPEC (Organization of the Petroleum Exporting Countries) meeting if the rest of the group’s members agreed to oil production cuts. OPEC and its allies, a group know as OPEC+, are considering meeting in February instead of March. The oil market is under pressure and prices have dropped to under $60 a barrel and efforts must be made to balance it, Zanganeh said.
Source: Reuters
3 February. A crude oil spill near Baytown, Texas, has restarted after earlier being contained, US (United States) Coast Guard said. About 630 gallons of diesel fuel spilled in Tabbs Bay and approximately one mile (1.6 km) of shoreline has been affected. The cause of the spill is under investigation.
Source: Reuters
1 February. Average daily oil production in Colombia rose 2.4 percent to 885,851 barrels a day in 2019, pushed higher by an increase in developed wells, Mining and Energy Minister Maria Fernanda Suarez said. Average daily crude production in 2018 was 865,127 barrels a day, the Minister said, revealing that the number of producing wells in the Andean country rose 6.6 percent to 773, from 725 in the prior year. Boosting its energy industry is a priority for Colombia. Last year it awarded 31 contracts to oil companies, which Luis Miguel Morelli, head of the national hydrocarbons agency, said would bring radical change to the sector. The country has around six years of oil reserves, which the government wants to see increase to 10 years. The government expects crude production to rise to between an average of 890,000 and 900,000 barrels of oil a day in 2020. Colombia is Latin America’s fourth largest crude producer, with proven reserves of almost 2 bn barrels of oil, which it hopes to raise via new discoveries and better extraction in existing fields.
Source: Reuters
29 January. Kazakhstan has contained the spread of contaminated oil within its borders by reducing exports to China and altering the schedule of supplies to domestic refineries, energy ministry and pipeline operator KazTransOil said. Kazakhstan suspended its oil exports to China after organic chlorides contamination was found in crude supplied by a Kazakh producer less than a year after the “dirty oil” crisis in neighbouring Russia. Unlike the Russian Druzhba pipeline problems in April last year, when 5 million tonnes (mt) of oil were contaminated with organic chlorides, the origin this time was Kazakh oilfields and the volumes were much less, at around 150,000 tonnes. Kazakh Deputy Energy Minister Murat Zhurebekov said oil exports to China had not yet been restored. The authorities have also been working on plans for dirty oil utilization.
Source: Reuters
29 January. Russian Energy Minister Alexander Novak said that Russia’s current tax system may pose risks to the country’s ability to maintain its oil output. Russia has been producing oil and gas condensate at a record-high pace of around 11.26 mn barrels per day. The government has been tweaking the tax regime, including gradually eliminating export duties and introducing profit-based taxation.
Source: Reuters
3 February. Plans to double gas exports from Papua New Guinea within the next four years are in doubt after the government walked away from talks with Exxon Mobil Corp on a key gas project needed for the $13 bn expansion. Papua New Guinea Prime Minister James Marape called off negotiations with Exxon on the P’nyang field, blaming the energy giant for failing to budge on a proposed deal that was “out of the money”. The expansion of liquefied natural gas (LNG) exports is crucial for the impoverished Pacific nation, but is vying with several proposed LNG projects in Australia, Mozambique, Qatar, Russia and the United States. The P’nyang agreement was one of two agreements needed for Exxon and its partners to go ahead with a $13 bn plan to double LNG exports from the Pacific nation. The other agreement, the Papua LNG pact, was sealed with France’s Total SA in September.
Source: Reuters
3 February. The United Arab Emirates (UAE) announced a new gas find with 80 trillion standard cubic feet (tscf) of shallow gas resources, a discovery that could help the country’s goal to achieve gas self-sufficiency. The find was made within an area of 5,000 square km between Abu Dhabi and Dubai, with ADNOC (Abu Dhabi National Oil Company) drilling more than 10 exploration and appraisal wells. The gas produced will be supplied to Dubai Supply Authority to support Dubai’s economic growth and enhance its energy security. ADNOC, the top national energy company of the UAE, a key member of the Organization of the Petroleum Exporting Countries (OPEC), produces about 3 mn barrels of oil and 10.5 billion cubic feet of raw gas a day. The UAE wants to achieve gas self-sufficiency and possibly become a net gas exporter. The country holds the seventh-largest proven reserves of natural gas in the world, at slightly more than 215 tscf, according to the US (United States) Department of Energy. Last year, the UAE announced a rise in oil and gas reserves as well as new unconventional gas discoveries in the emirate of Abu Dhabi. That boost would move the UAE to sixth place in the global gas rankings with 273 tscf of conventional gas. The UAE became a net gas importer in 2008 due to growing demand for power and as it needed gas to reinject into its oilfields to enhance crude production. It has been importing gas from Qatar via the Dolphin Gas pipeline.
Source: Reuters
31 January. PennEast Pipeline Co LLC said it has asked federal energy regulators for permission to build the Pennsylvania part of its proposed natural gas pipeline first due to difficulty in gaining approvals in New Jersey. The company said that it expects to be able to complete the Pennsylvania section of the pipeline by November 2021. As for New Jersey, the company said it was targeting completion of the second phase of the project from Pennsylvania into New Jersey in 2023. FERC (Federal Energy Regulatory Commission) approved PennEast’s request to build the pipeline in January 2018, and the company promptly sued in federal court under the US (United States) Natural Gas Act to use the federal government’s eminent domain power to gain access to properties along the route. PennEast needs the New Jersey land to build its 120 mile (193 km) pipeline, which is designed to deliver 1.1 billion cubic feet (bcf) per day of gas from the Marcellus shale formation in Pennsylvania to customers in Pennsylvania and New Jersey. One bcf is enough gas to supply about 5 mn US homes for one day.
Source: Reuters
31 January. Australia’s government began a push to boost gas supply and renewable energy as part of a A$2 bn ($1.37 bn) deal with its most populous state, looking to cut carbon emissions in the wake of devastating bushfires. The NSW (New South Wales) government has committed to help bring on new supply of 70 petajoules (PJ) per year of gas for the east coast market, which faces a sharp decline in supply from its main gas source in the Bass Strait off Australia’s south coast.
Source: Reuters
30 January. China has restarted talks with US (United States) liquefied natural gas (LNG) marketers to buy more LNG, several industry executives said, but they are worried that any purchases may come too late to keep natural gas prices from falling further due to a glut of global supply. China pledged to buy an additional $18.5 bn in US energy products this year, but the US-China trade agreement left tariffs in place, including a 25 percent levy on LNG imports that puts US LNG at a disadvantage, producers said. Exports of LNG are the fastest growing source of US gas consumption, more than doubling since 2017 largely on Asian demand. Prices have tumbled due to rising global supply, and the glut is expected to grow.
Source: Reuters
4 February. Polish state-run power producers will halt coal imports, State Assets Minister Jacek Sasin said, after protests by mining trade unions over foreign supplies they say are a threat to the domestic industry. Poland generates most of its electricity from coal, but domestic output has fallen because of cost-cutting and geological problems in old mines, which had led to higher imports, mostly from Russia. Around 100 miners blocked trains carrying coal to a power plant in the southern town of Laziska Gorne in protest at imports from Russia by state-run energy groups, including PGE and Tauron. Unions said increased imports, together with falling demand following a mild winter, have increased coal stockpiles, threatening normal operations of Poland’s coal mines. Sasin said the government cannot ban coal imports for private companies, for which the imported coal is cheaper and of higher quality than domestic production. Trade unions at Poland’s biggest coal mining firm PGG have not ruled out a strike to demand a pay rise and address the issue of stockpiles. In 2018 Poland imported almost 20 million tonnes of coal. Poland is also under pressure from the European Commission to use less coal.
Source: Reuters
1 February. The direct impact on metallurgical coal imports is, initially at least, likely to be relatively muted, predicts analysis firm Wood Mackenzie. In the very near term, impacts on domestic metallurgical coal supply are likely to be bigger than demand. Coal supply usually recovers as employees return after the holidays, but many miners will now face restrictions – some self- imposed. Mongolia exported 24.8 million tonnes (mt) of coking coal into China in 2019, which can be translated into 2 mt of low-sulphur HCC supply into China every month. However, there will be an inevitable decline in steel demand which will affect steel prices and margins, and we expect metallurgical coal demand between March and May to be lower than it would have been.
Source: The Economic Times
30 January. Indonesia plans to set cheaper prices for coal to be sold to future gasification facilities as part of incentives for investors, Energy and Mineral Resources Minister Arifin Tasrif said. The government is promoting the development of the coal gasification industry to take advantage of Indonesia’s large coal output and is offering incentives to attract investments. Tasrif said the government will “direct” coal prices to $20 to $21 per tonne for future plants that will process coal into gas. Indonesia’s government coal benchmark price is currently set at $65.93 per tonne. Tasrif said the government is also planning to lower royalty charges for coal miners investing in gasification. State coal miner PT Bukit Asam is currently planning to build a gasification plant in South Sumatra that is expected to start operation around 2023-2024. The country’s largest coal miner PT Bumi Resources is conducting a feasibility study on potentially investing over $1 bn in a gasification facility.
Source: Reuters
30 January. South Africa’s Wescoal expects to break ground in February at its greenfield Moabsvelden project, with the mine poised to supply Eskom’s Kusile power plant with 3 million tonnes (mt) of coal a year at its peak, group chief executive Reginald Demana said. The new project is being developed amid a global pushback against the coal industry, as banks and other investors retreat from the commodity in the fight against climate change. Around 50 protesters dumped lumps of black coal outside the conference venue to highlight environmental and health problems associated with the coal mining industry. South Africa’s Energy Minister Gwede Mantashe has pledged to keep coal in the country’s ‘energy mix’ — it has around 30 billion tonnes (bt) of coal reserves — even as it adopts more solar and wind projects to meet its climate commitments.
Source: Reuters
30 January. The German government approved a bill that will codify the country's closure of coal-fired power stations, defending the plan against critics who say it's not ambitious enough. After signing off on the bill in Cabinet, Economy Minister Peter Altmaier called the plan to phase out the burning of coal by 2038 "a breakthrough" in efforts to combat climate change. Ottmar Edenhofer, co-director of the Potsdam Institute for Climate Impact Research, welcomed the Cabinet decision, but said the government had made a mistake by pledging large sums to coal plant operators in return for the shutdowns.
Source: The Economic Times
30 January. Households in Britain have overpaid its electricity networks at least 800 mn pounds ($1.05 bn) over the current eight-year (2013-2021) regulatory period. Britain’s energy infrastructure, such as gas pipes and electricity cables, is owned by several firms, including SSE, National Grid and Iberdrola’s Scottish Power. Under energy regulator Ofgem’s price control system network operators present investment plans setting out the work they will do and its cost. Ofgem assesses the plans and sets limits on the profit the network operators can make. Britain’s National Audit Office said Ofgem had allowed some companies to set cost budgets too high and network performance targets too low, while the eight-year regulatory period was too long and could delay investments. Network costs account for about 20 percent of an average electricity bill equivalent to about 130 pounds a year.
Source: Reuters
30 January. The EEX European energy bourse said it planned to offer clearing services for Japanese power futures from 18 May 2020, as it expands in wholesale markets. The start date was announced at the EEX Group Japan Power Conference in Tokyo after a two-year consultation process, EEX said. Pending regulatory approval in Europe, it will be EEX’s first tailor-made power futures service in Asia, adding to its 20, mostly European, power derivatives markets. Japan’s government has promoted competition in the country’s regionalised power market since the Fukushima nuclear crisis in 2011 by allowing new entrants, encouraging renewables, and supporting free market trading alongside bilateral sales by utilities to customers.
Source: Reuters
3 February. Britain’s energy market regulator Ofgem laid out a plan to support the growth of renewable energy and get 10 mn electric vehicles on the roads by 2030. Its “decarbonisation action plan” also aims to support the development of an offshore grid to enable a four-fold increase in offshore wind generation in the next 10 years and a fund to encourage investment in solutions to tackle climate change. As pressure to act on climate change mounts, many countries need to tackle how to ensure secure supplies of electricity amid rising proportions of renewable energy on the grid. Last year, Britain was the first major economy to legislate a net zero greenhouse gas emissions target for 2050. Ofgem’s plan has nine actions focused on ensuring energy networks are ready to deliver net zero emissions, dealing with increased electricity demand and how to decarbonise the heat and transport sectors. To meet the net zero goal, Britain will have to change the way homes and businesses are heated, including the use of hydrogen boilers or electricity to power heat pumps, Ofgem said. Britain’s grid operator National Grid welcomed the plan, saying it is critical the regulator, government and industry are aligned to decarbonise the energy sector in the journey to net zero emissions at the lowest cost to consumers.
Source: Reuters
3 February. The Netherlands’ biggest pension fund, ABP, said it aims to reduce the carbon footprint of its asset portfolio by 40 percent from 2015 levels by 2025. ABP, which already set a target to cut the carbon footprint of its assets by 25 percent from 2015 levels by this year, follows moves by other leading funds - notably Norway’s $1.1 tn sovereign wealth fund - to divest heavy polluting energy companies from its portfolio.
Source: Reuters
30 January. Indonesian government plans to remove old coal-fired power plants with plants using renewable energy, the country’s Energy and Mineral Resources Minister Arifin Tasrif said. Tasrif said the country will replace coal power plants aged 20 years and older. Indonesia, a major coal exporter, uses coal to power around 60 percent of its electricity needs but the government is aiming to double the contribution of renewables, which include solar power, geothermal and hydropower, among others.
Source: Reuters
30 January. The United Arab Emirates (UAE) has grown in renewable energy portfolio by over 400 percent in the last ten years and well on track to double it again in the next ten years. Its commitment to clean energy was on full display at the recently held Abu Dhabi Sustainability Week, a global platform for accelerating the world’s sustainable development. Through initiatives such as the Mohamed bin Rashid Al Maktoum Solar Park and Masdar, renewable energy projects totalling almost 12 GW were launched in the UAE and in more than 30 countries around the world. The Abu Dhabi National Oil Company CEO (Chief Executive Officer) Al Jaber said the company would further strengthen its commitment to environment stewardship by reducing greenhouse gas emission intensity by 25 percent by the year 2030. It will limit fresh water consumption to below 0.5 percent of total water use and increase carbon capture, utilisation, and storage program by 500 percent.
Source: The Economic Times
(in percent)
| Year | Year on Year Growth | |
| Wind | Solar | |
| 2015-16 | -2.2% | 61.9% |
| 2016-17 | 39.3% | 81.3% |
| 2017-18 | 14.5% | 91.6% |
| 2018-19 | 17.8% | 51.8% |
Trends in Solar & Wind Electricity Generation
Source: Central Electricity Authority
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This is a weekly publication of the Observer Research Foundation (ORF). It covers current national and international information on energy categorised systematically to add value. The year 2019 is the sixteenth continuous year of publication of the newsletter. The newsletter is registered with the Registrar of News Paper for India under No. DELENG / 2004 / 13485. Disclaimer: Information in this newsletter is for educational purposes only and has been compiled, adapted and edited from reliable sources. ORF does not accept any liability for errors therein. News material belongs to respective owners and is provided here for wider dissemination only. Opinions are those of the authors (ORF Energy Team). Publisher: Baljit Kapoor Editorial Adviser: Lydia Powell Editor: Akhilesh Sati Content Development: Vinod Kumar |
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