Energy News Monitor I Volume I, Issue 33

Energy Injustice in India: Hiding Behind Poor

Continued from Volume VI, Issue No. 32…

he poverty alleviation, rural electrification, decentralized electricity supply system based on renewable energy sources, human development, mitigation and adoption to Climate Change are all intricately linked and hence need to be addressed with an integrated approach.

Conclusions and Recommendations – towards a sustainable and equitable future

The study clearly shows that India has failed to overcome the continued electricity injustice even after 6 decades of independence. Whereas India is demanding higher carbon space from the international community to enable its poor to develop, and is embarking on huge capacity addition drive based on fossil fuel power plants, it has not been able to provide such space to its own rural population. But the increased focus on large sized conventional power plants, despite the full knowledge of all the deleterious impacts of these power plants, is leading to ever growing contribution of GHG emissions. The urban – rural divide in the supply of electricity is very stark when we consider the fact that about 40% of the households, mostly in rural areas, are still without electricity, while the urban areas have almost 100% electrification, and a small section of the urban population are even approaching the per capita consumption levels of developed countries.

Whereas the grid based centralized generation system has failed to meet the basic energy needs of the majority of the country’s rural population, the same is proving to be very costly to the society in the form of economic, social and environmental impacts. The escalating growth of conventional electricity power plants based on fossil fuels and dams in the country are not only adversely impacting the rural communities around such plants, but also are attracting world attention because the country is seen to be emerging as one of the biggest contributors to the Global Warming.

An objective review of the real costs and benefits to society of large size power plants and centralized power network is urgently required; especially in the context of rural electrification.

Grid based centralized generation system has been considered by the successive governments as the solution for faster economic growth and accelerated rural electrification, but in reality the same is observed to be helping largely to meet the ever growing electricity demand of urban population. Whereas the capital cities and other urban areas are recording huge increases in per capita electricity consumption, the rural population is suffering due to very poor quality of supply even in those areas, which officially have electrification. Large centralized installed capacity addition will ultimately not be an equitable solution to ensure quality power to the poor people, and therefore not lead to their development.

The deficiencies, complexities and costs inherent in the grid based centralized generation system in India cannot provide any assurance that the rural-urban divide will be eliminated soon and that the electricity supply at the national level will be satisfactory in the near future. The decentralized energy solutions are the right answers to provide quality access to electricity to the rural population and not the centralized grid solutions.

If India is to live upto the expectations as a welfare society; if it is to emerge as a world leader in combating the climate change; if it is convinced of the need to eradicate the calamitous divide between urban and rural populations, it has to adopt a paradigm shift in the way it looks at it energy needs, and need to take all possible measures to move towards a more equitable society.

A thorough review of the existing practices in the way power sector is managed will reveal that there is huge scope for improvement before we can catch up with the best practices: whether it is in improving the generating plant performance, OR reducing the T&D losses; OR minimizing the wastage in usage, OR demand side management (DSM); OR energy conservation. Adequate funds should be made available to realize this potential before 2015 to enable peaking of GHG emissions in the power sector.

Few recent initiatives in the private sector to provide electricity to un-electrified villages through stand alone community based non-conventional energy power plants fed by bio-mass OR wind OR solar OR micro-hydel power should be replicated at a wider scale throughout the country on a priority basis.

Each of the state electricity supply companies should be asked to manage the establishment of a certain number of stand alone community based non-conventional energy power plants every year until the entire house holds in each state are electrified.

The central sector Public Sector Undertakings, such as NTPC, DVC, and NHPC etc. should be asked to invest certain percentage of their annual budget to establish such stand alone community based non-conventional energy power plants every year either on their own or in joint venture.

Suitable tax regimes to cover the societal costs (such as environmental and health costs) of large conventional power plants should be implemented early.

The tariff in each state should be structured to minimise the profligacy in electricity, by having steeply increasing tariff levels beyond modest levels of energy consumption to meet the essential needs. For example, in cooler places of Karnataka a family of four may be able to meet most of its essential needs with a per month electricity consumption of between 50 to 100 Units. Anything beyond this specific consumption should be billed at an escalating rate, say 25% more than the cost of supply between 100 and 200 units; 50% more than the cost of supply between 200 and 300 units; 75% more than the cost of supply between 300 and 400 units etc.

Much more responsible functioning by the electricity supply companies should be mandated, and they should adopt world best practices in all aspects of electricity supply industry.

The country must implement definitive, well considered and effective action plans not only to eradicate the urban-rural divide leading to a welfare society, but also to emerge as a world leader in combating the Climate Change.

At a time when there are frantic international efforts to find an acceptable action plan to contain the Global Warming, India must choose a sustainable developmental model for its teeming millions such that GHG emissions are at an acceptable level without having to compromise on legitimate aspirations of its people to develop. Irrespective of whether there will be international agreement or not in GHG emission cuts, India must adopt suitable measures to keep the GHG emissions under check, basically to safeguard its vulnerable sections. And the potential for such effective measures in the country is huge; only a strong political will is needed.

Concluded

Views are those of the author

Author can be contacted at [email protected]

Note: Part V of the article on Oil & Gas Discovery & Production in India: Historical Milestones, part XIII of the article on Gas in India – Issues, Opportunities and Challenges will be published in Volume VI, Issue 34

Energy in India’s Future: Insights (part –XVIII)

Jacques Lesourne and William C. Ramsay*

Continued from Volume VI, Issue No. 32…

n the upstream segment, there have been a significant number of joint ventures, with foreign players tying up with the domestic players, both private and public. These joint ventures provide for a sound partnership for domestic firms in the bidding process (both on technical and financial grounds). Table 28 through Table 31 reflect the growing share of private firms in the oil and gas sector.

Table 28. Emergence of new entities in the post 1990s period

Energy News Monitor I Volume I Issue 33

Source: Menon-Choudhary and Shukla (2006).

Table 29. Production of crude oil by firm (%)

Energy News Monitor I Volume I Issue 33

Source: Ministry of Petroleum and Natural Gas (MoPNG), http://www.petroleum.nic.in

Table 30. Production of gas by firm (%)

Energy News Monitor I Volume I Issue 33

Source: MoPNG, http://www.petroleum.nic.in

Table 31. Marketing of petroleum products by firm (%)

Energy News Monitor I Volume I Issue 33

Source: MoPNG, http://www.petroleum.nic.in

On strategies of industry diversification and technological shift

Outbound investments in the oil and gas sectors accounted for 19% of the Indian FDI stock in 2006. But this rather reflects an early tendency. Although Indian concerns initially sought to secure energy resources and conquer external markets in a context where their growth on the domestic market was tightly controlled, recent dynamics mainly reflect a search for strategic assets: technology, market shares in developed economies, brands and new R&D skills. Like Chinese firms, they are seeking to improve their initial cost advantage on the domestic market by moving up the added value chain. It is thus interesting to note that in the year 2004 for instance, the sectors in which Indian firms concentrated their FDI in the United States were in information technology (80%), chemicals (7%) and pharmaceuticals (7%). On the other hand, only 19% of the FDI in the European Union targeted information technology, the rest going to pharmaceuticals (17%), electronics (10%), transportation (9%), chemicals (7%) and metal products (6%), the remaining 30% going to a wide variety of other sectors. Nowadays, investment abroad in energy mostly concerns the state Indian companies. In fact, as one tries to foresee the future, these “statistics” are highly dependent on the individual strategies of a very few but large firms: Tata Power, Reliance, or a company like Suzlon which has in a few years become the first Asian company in renewable energy which could with single investments change the overall investment structure. International collaboration gets structured around sustainable development projects and environment programs. The UNIDO, for instance, launched an international network for “cleaner production centers” targeting small and medium enterprises (SMEs) of 23 developing countries including India. It focuses on projects for reduction of the environmental impact of the small industry. In India it working with the Confederation of Indian Industry (CII), with an initial focus on automotive equipment clusters. Decentralized projects exist as well, like the Industrial Ecology Asia Network—India, with a similar project around the Kaiserslautern University, ICAST (Technology Exchange Network), the textile sector of the cities of Naroda and Tirupur, tanneries in the State of Tamil Nadu, foundries in Calcutta, the paper or sugar industry in Ankleshwar, Nandeseri, Thane-Belapur. These projects all seek to establish links between services, environment, and the economic security of the people. Ultimately, the emerging scenario is of a technological catching-up for renewable energies, led by the private industrial sector: ethanol, CNG and LPG in the short term, and biodiesels on the mid run (3–10 years), and most likely hydrogen and “fuel cells” in the longer term (possibly after 2015). On this latter question, the Syndicate of Indian Automobile Manufacturers (SIAM) expects hybrid vehicles (H₂ + CNG) and pure hydrogen combustion models to pick up very fast from now on.

On feedback and systems: Peri-urban, rural and micro-financed models and energy efficiency in urban transports and water

Lack of space prevents us from delving deeply into this, but the very conception of systems, and especially peri-urban and urban systems, is at the core of energy sustainability for the future. Let us very briefly state this as to water and transports.

The private sector to tap local renewable potential

Banking on a surge from 3.5% of grid capacity from renewable energy sources to 10%by the year 2012 (and a long term scenario of 50,000 MW of renewable energy to be commercially exploited by 2050), SREI Finance, the leading infrastructure asset leasing company in India with a very impressive business model, launched SREI Renewable Energy Unit (SREU) in 1999 with the mission to “create a suitable institutional structure for effective development of renewable energy market on commercial basis and finance Renewable Energy Technologies (RETs).” Its portfolio encompasses solar, wind, hydro and hybrid energy. Building on a model of leveraging acommercial base or office network from one activity to another, SREI has built on its dense network of financial agencies to develop into new business units. In the first 6 years of operation, SREU had also developed a portfolio of contacts with major players in technology supply, finance worldwide, government, and NGOs³⁷. In order to improve its commercial target, it had even used the micro-credit model through its partner NGOs. We believe these business practices, that bridge levels of intervention across a large spectrum, illustrate what we showed in the first part of this chapter. If this is true, then a company like SREI may be at the forefront of invention in an economy where the “average” doesn’t mean much.

A promising model for the industry: Peri-urban bioenergies

The production of biogas at the individual scale, if generalized to potential of 9 to 12 million units that India hosts, could have a considerable impact in the countryside, on forest preservation as well as on the macroeconomic level. A large potential remains untapped for the development of private rural markets, and successful experiments are numerous, such as biogas initiatives in the villages of Singhpura and Lotna, in the Tikamghar district in Madhya Pradesh, under the “National Project for Biogas Development” launched in 1981–1982 by Indira Gandhi. However, successes do not exist in India, often explained by the persistence of social/cast-based taboos. The largest community-based experiment, in Pura (Mandya district, in Karnataka), run by the Indian Institute of Science, Bangalore, was a failure after 7 years of effort. Recent developments now target more homogeneous communities, typically in periurban and semirural areas. In terms of compared viability of different techniques, one now sees enough projects that have developed well whether developed by individuals, communities, or industrials. However, real economic benefit usually accrues only in the last two cases; individual level projects are not yet very viable. In terms of treatment of agricultural waste, industrial projects seem the only one to really resolve this local environment issue.

Water-energy linkage in the urban scenario

If one looks at the energy linkage, and especially the energy component of inputs for water supply, the figures from Chennai are illustrative of two aspects. First, power amounts to 57% of technical operational costs on the centralized piped system (power, chemicals, O&M). Second, this share is actually much higher as far as a long-term energy scenario is considered, since the insufficiencies of the centralized piped system have led to a “drought scheme” and hiring of water lorries. In both cases, the energy part represents the majority of the total burden of 750 million rupees! The amounts at stake are really worth considering alternative technical organization.

If one considers sanitary water, that is the flushing and house cleaning part, this share represents 30% of domestic usage.³⁸Given the energy share in total supply costs, potential savings may be tapped from here. Indeed, this water could be produced locally, either by using groundwater sources that otherwise tend to be gradually eliminated by public organizations, or more likely by local (area-wise, ward-wise…) recycling of the wastewater coming from the other 70% uses of water. This would in turn save on transportation costs for water. This measure is interesting not only for cities like Chennai (resources constrained) or Bangalore (where water has to be pumped from a 150 km distant source and brought to the heights of the city), but even for a water-rich city like Bombay, which, though it offers 250 litres per capita and per day to its people, takes it from distant sources (see Ruet, Saravanan, Zérah, 2002).

Urban transports

Considering the life span of urban structures, the type of urban growth that cities of the South will experience in the next three decades will determine the level of their energy consumption and greenhouse gas emissions in the second half of the century. Whether Southern cities follow the example of Atlanta or Barcelona, climate change will clearly have an entirely different magnitude by the end of the 21st century (Barcelona houses and employs a population 20% larger than that of Atlanta, but on a surface area 26 times smaller, and uses 11 times less energy per capita for urban transportation).³⁹The future of the energy consumption of urban transportation is alarming. The factors that determine the energy consumption of urban transportation are much more complex to analyze, on the one hand, and more difficult to influence through public policy, on the other. Yet this is the energy consumption that is expected to grow the fastest, in business-as-usual scenarios. Moreover, urban spatial structures, which obviously have a significant impact on the demand for transportation and thus, on the energy consumption of transportation, have a much longer life span than buildings, and are much more resilient. Therefore, taking action in this area is both a matter of urgency and a long-term commitment. This requires a two-pronged approach to tackle urban energy consumption, combining transportation policy and land use policy. Motorized vehicles must be made less polluting, the use of private vehicles must be discouraged, and efficient public transport must be promoted. Urban planning and land use rules must be adapted in order to facilitate the concentration of private investment in areas of high accessibility, generated by the implementation of mass transport systems. This will reduce the need for mobility, through high density and diversity of urban functions. Nonmotorized commuting must also be encouraged through appropriate urban design, and the articulation of different types of transportation. This general issue finds a propitious terrain for analysis in India. Until now, the strategy adopted by Indian municipalities has essentially been limited to increasing the capacity of the road network. This headlong rush is particularly dangerous in that it creates an urban structure which is increasingly dependent on the car. In Delhi, scenarios forecast an increase in the number of daily trips per person from 0.8 to 1.2 between now and 2021 and a 50 % increase in average journey length (by both car and bus). To meet this demand, the number of vehicles would increase to 8 million. It is therefore indispensable to provide effective alternatives. Fortunately, Indian urban structures are still compatible with transport systems based on transport corridors. Urban development has been channeled by major infrastructures (road or rail) and not spread over the entire urban area. As a consequence, the cities which are highly congested are those which are saturated by cars. They are not (yet) cities which are morphologically dependent on the car (where activities and residential locations are highly dispersed). This context provides an opportunity for large passenger flows and the development of Mass Rapid Transport (MRT) systems.

Many Indian cities have placed the construction of a Mass Rapid Transport (MRT) system on their political agenda. Delhi opened its third metro line in September 2005. The construction of the first metro lines will get underway shortly in Bangalore, Hyderabad and Mumbai. Pune and Ahmedabad are discussing introducing Bus Rapid Transit (BRT). Chennai is considering constructing a light metro. It is urgent for theses projects to materialize. For the opportunity that mass transit represents to become a reality, it is essential to coordinate urban planning and transportation policies. Land use plans and floor area ratios should be modified to facilitate the concentration of private investment in zones of high accessibility. However, in practice, urban and transport plans are usually drawn up without considering the interactions between them. We do not as yet possess sufficient understanding of the links between the construction of transport infrastructure and changes in land use and the same applies to the links between changes in the land use plan and floor area ratio and travel demand.

Notes:

37 The variety of its partners is worth mentioning: from the Indian Renewable Energy Development Agency Ltd. (IREDA)—the Apex nodal agency for Renewable Energy Development in India, to the Global Environment Facility (GEF), passing through International Finance Corporation (IFC), Washington—World Bank Group, IT Power India (Pvt.) Ltd., IMPAX CAPITAL, UK, the national and international reference that is the Tata Energy Research Institute (TERI), with the official support of the Ministry of Non-Conventional Energy Sources (MNES).

38. The part relating to flushing of the toilets may not necessarily represent “in-house” toilets: it represents what, one way or another, is needed to evacuate the excreta: that way, this estimate applies to all categories.

39. This subsection quotes and draws from findings by Benoît Lefèvre. See Lefèvre, B., 2007, La soutenabilité environnementale des transports urbains dans les villes du Sud. Le couple « transport – usage des sols » au coeur des dynamiques urbaines, Thèse de doctorat en sciences économiques, Dir Giraud, P.N., Ecole des mines de Paris. Lefèvre, B., 2006, “Urban Transport, the Environmental Challenge Posed by the Growth of Indian Cities”, Ville en Développement, n° 71, ISTED.

* Editors

to be continued…

Courtesy: ENERGY IN INDIA’S FUTURE: INSIGHTS, GOUVERNANCE EUROPÉENNE ET GÉOPOLITIQUE DE L’ÉN

NEWS BRIEF

NATIONAL

OIL & GAS

Upstream

ONGC bids for Venezuela oil block

January 29, 2010. Oil and Natural Gas Corp (ONGC) has bid for Venezuela's Carabobo oil auction along with Spain's Repsol YPF SA and Petroliam Nasional Bhd of Malaysia. Other members of the consortium pieced together by ONGC Videsh - the overseas arm of state-owned firm, include Indian Oil Corp and Oil India Ltd. The consortium is believed to have bid for Carabobo Norte I, one of the three blocks that were on offer, they said. Bidding for Carobobo round closed yesterday that also saw a consortium made up of the US energy major Chevron, Venezuela's Suelopetrol and Japanese firms Mitsubishi, Jogmec and Inpex putting a bid. Royal Dutch Shell Plc too submitted an offer but UK's BP Plc did not make a bid.

Cairn doubles oil, gas output on India startup

January 28, 2010. Cairn Energy said its 2009 net oil and gas production more than doubled to 27,008 barrels a day on average due to the startup of the company's major fields in Rajasthan, India. The Mangala field in Rajasthan, which is operated by Cairn Energy subsidiary Cairn India, and started pumping oil last summer, produced 15,430 barrels of oil a day on average in the fourth quarter of 2009 and has averaged more than 20,000 barrels a day this year, Cairn said. Mangala is on track to produce 120,000 barrels of oil a day by the end of the first half of this year after phase two and three of the field come onstream, Cairn said. A fourth phase will bring the field up to plateau production of 175,000 barrels a day at a later date.

Downstream

Indian Oil to expand in North

February 2, 2010. Indian Oil Corporation Limited, the market leader in the oil and gas distribution in India, plans to consolidate its presence in Punjab, Jammu and Kashmir, Himachal Pradesh and Chandigarh.

Demand from the agriculture sector was very high in Punjab due to increasing use of the diesel-run generators to support the tubewells in the wake of inadequate power supply. This results in substantial demand of diesel in Punjab.

Capacity on the rise at new Jamnagar refinery

February 1, 2010. The second refinery, set up by Reliance Industries Ltd (RIL) at its Jamnagar complex in Gujarat, has already overtaken the older, adjacent refinery in production volumes and could go even further--exceeding its design capacity by at least 20 percent.

The second refinery, which was commissioned by RIL in end-December 2008 to process 580,000 barrels per day (bpd), started full-scale commercial production early this fiscal. It operated at 115 percent of its stated capacity in the October-December quarter. At this rate, the refinery could refine 667,000 bpd, overtaking RIL's older Jamnagar refinery, which can process 660,000 bpd. Put together, it's the largest refining operation globally at a single location.

PSU refiners gear up for BS III fuel supply challenge

February 1, 2010. On February 15 and the roadmap for phased supplies of Bharat Stage III petrol and diesel between April 1 and October 1 this year will be made public. As far as the three public sector refiners — IndianOil, Hindustan Petroleum Corporation and Bharat Petroleum Corporation — are concerned, it will be a huge challenge from the viewpoint of logistics, costs and timely supplies.

For six months, they will be part of a script where BS II, III and IV auto fuels co-exist, which means extra vigilance on quality and adulteration. In contrast, supplies of BS IV auto fuels will be a smooth task and will go on schedule across the 13 cities earmarked from April 1. The list comprises Delhi, Mumbai, Kolkata, Chennai, Bangalore, Hyderabad, Pune, Surat, Ahmedabad, Kanpur, Lucknow, Agra and Solapur.

IOC’s Q3 profit slides 76.45 pc

January 29, 2010. State-run Indian Oil Corp (IOC) reported a 76.45 per cent drop in net profit in the third quarter after the government failed to compensate it fully for losses from selling cooking fuels below cost. The net profit in October-December at Rs 6.9659 bn was lower than Rs 29.5859 bn reported a year ago. While losses on petrol and diesel were fully made up by upstream firms like ONGC, Government’s cash compensation left most of the domestic LPG and kerosene losses uncovered. IOC will get Rs 71.0018 bn in cash for revenue losses incurred on selling cooking fuel below cost for the full fiscal. Of this, it accounted for Rs 44.8249 bn in the third quarter. The compensation received was inadequate to cover for LPG and kerosene losses and if this was not increased, IOC would end the year with a revenue loss of Rs 120 bn.

Reliance leases storage in the Caribbean

January 28, 2010. Reliance Industries, owner of the world's largest oil refining complex, has leased storage to store gasoline at the Borco oil terminal in the Caribbean. The deal on the 500,000 barrels storage facility was secured sometime towards the end of last year. Reliance, which operates two mega-refineries in the West Coast of India that has a combined crude processing capacity of 1.24 million barrels per day (bpd), has over the past few years embarked on a robust marketing campaign for their products in Europe, Latin Ameica, East Africa and the United States.

ONGC in pact with Angola's Sonangol

January 27, 2010. India's Oil and Natural Gas Corp (ONGC) signed an agreement to bid for oil acreage in Angola with the African nation's state-owned Sonangol, while Indian Oil Corp (IOC) offered to build a multi-billion dollar refinery in that country. State-run gas utility GAIL India expressed interest in taking equity in a planned liquefied natural gas (LNG) plant in Angola during Petroleum Minister Murli Deora's maiden visit to the African nation. At the meeting, IOC Chairman Sarthak Behuria offered to participate in the Sonaref project for building a 10 million tonne refinery at Lobito. He also offered IOC assistance in upgrading Angola's two refineries.

Transportation / Trade

Oil companies cut ATF prices

January 31 2010. State-run oil firms cut aviation turbine fuel (ATF) prices by 5.5 per cent to almost negate the steep hike they effected earlier this month. Jet fuel price in Delhi was cut by Rs 2260 per kilolitre or 5.48 per cent to Rs 38,956 per kl. On January 16, IOC and other state-owned retailers Hindustan Petroleum and Bharat Petroleum had hike ATF rates by 6.5 per cent to Rs 41216.43 per kl. The three oil firms revise jet fuel prices on the first and the 16th day of every month based on the average global oil price in the previous fortnight. In Mumbai, the rates were reduced by Rs 2354 to Rs 40,181 per kl. Jet fuel constitutes roughly 40 per cent of the operating cost of an airline and the reduction in fuel rates would help ease the burden of Indian carriers.

Policy / Performance

Negative view on state-run oil cos: Fitch

February 1, 2010. The global rating agency Fitch said there is a negative overhang in the downstream sector (refining and marketing) of the country's public sector oil and gas firms. Fitch, in its special report, said the upstream sector (exploration and production) of the country's oil and gas industry has a stable outlook but the outlook on the downstream business is negative to stable. The government had set up an expert committee in FY10 to advise on domestic fuel pricing issues, which has yet to submit its report. While the government has not allocated any oil bonds to date in FY10, it has recently confirmed increased budgetary support to downstream PSCs for the year.

Govt may hike natural gas price

February 1, 2010. The government may decide on raising price of natural gas produced by state-owned ONGC and Oil India by 30 per cent, Petroleum Secretary S Sundareshan said. The Oil Ministry has circulated a Cabinet note for raising price of gas under administered pricing mechanism (APM) from Rs 3,200 per thousand cubic meters (USD 1.79 per mmBtu) to Rs 4,142 per thousand cubic meters (USD 2.32 per mmBtu). Price of APM, or the gas produced from fields given to ONGC and OIL on nomination basis, is proposed to be raised in stages to Rs 7,500 per thousand cubic meters or USD 4.2 per million British thermal unit by 2013. Sundareshan said the government was weighing policy options to end differential pricing of natural gas that ranges from under USD 2 per mmBtu (APM gas) to USD 5.73 per mmBtu (for gas produced by BG Group-operated Panna/Mukta and Tapti fields). Options for uniform pricing of gas from various sources to consumers by way of pooling of prices was being studied, he said.

ONGC to spend Rs 260 bn on capex in next fiscal

February 1, 2010. The Oil and Natural Gas Commission (ONGC) Limited will spend Rs 260 bn on capital expenditure in the next financial year. The capital expenditure in this financial year is Rs 240 bn, he added. Most of the budget will be spent on Exploration and Modernization plans.

Oil refiners staring at Rs 250 bn losses on LPG, kerosene this fiscal

January 31, 2010. IndianOil, Hindustan Petroleum Corporation and Bharat Petroleum Corporation are staring at losses of nearly Rs 250 bn on sale of cooking gas (LPG) and kerosene during 2009-10. With no compensation formula in place yet, the three companies can only dip into the Finance Ministry's one-time support package for the fiscal. This works out to a paltry Rs 41.10 bn which will still leave a huge deficit of Rs 200 bn plus. The Finance Ministry had allocated Rs 120 bn of which IOC accounted for Rs 44.83 bn in the April-December period with HPCL and BPCL providing Rs 18.97 bn and Rs 15.10 bn each. All in all, the trio have already considered Rs 78.90 bn for the first nine months which leave them with only Rs 41.10 bn in the fourth quarter. Incidentally, IOC's overall share of the Finance Ministry's package was Rs 71 bn for 2009-10. HPCL and BPCL got Rs 25.29 bn and Rs 23.71 bn each.

NTPC to cross-examine RIL witnesses in case over gas supply

January 28, 2010. State-run power producer NTPC Ltd informed the Bombay High Court it will cross examine witnesses of Mukesh Ambani-led Reliance Industries Ltd (RIL) in a dispute relating to a gas supply contract between them. NTPC's move to cross examine RIL witness apparently indicates it would fight the legal battle vigorously in the high court to ensure that the contract between is implemented in letter and spirit. The dispute relates to gas supply contract between RIL and NTPC. NTPC had taken RIL to court seeking implementation of the Mukesh Ambani-run firm's 2004 bid to supply 12 MMSCMD gas at $2.34 per MMBTU for 17 years. NTPC had floated a global tender for sourcing gas at the most competitive prices for expansion of its 1,300 MW Kawas and 1,300 MW Gandhar projects in Gujarat. RIL bid the lowest and a letter of intent was placed on RIL for supply of gas at $2.34 per million British thermal unit (prices without taxes and transportation cost) for 17 years.

POWER

Generation

Dadri plant to give city 490 MW of extra power

February 2, 2010. The power-starved capital got a boost in energy generation with the commissioning of the first unit of NTPC's 980-MW gas-based Dadri power station on Sunday. Delhi will enjoy upto 490-MW more power with this move.

The second 490-MW unit of the plant is expected to be commissioned by March/April though sources said that it was unlikely that the unit would be operational before May/June. The state government is relying heavily on the second unit to meet the summer load.

This is the first enhancement to Delhi's power generation ever since the 330-MW Pragati power station was commissioned in 2003. Delhi has failed to keep up with its rising power demand over the years, its fallout evident during June 2009 when peak demand reached 4,480-MW and there were power cuts lasting 10-12 hours.

GVK Power mops up funds for Punjab plant

February 2, 2010. Hyderabad-based infrastructure company GVK Power and Infrastructure (GVKPIL) has managed to arrange funding for its 540 mw coal-based power plant in Punjab. The company has raised Rs 24 bn in debt to part finance the Rs 32 bn project named Goindwal Sahib. GVK currently has a capacity of 900 mw with an additional 970 mw in the pipeline. GVK expects to meet the demand for coal from its captive mines, known as GVK Coal and Seregarha Mines, in Jharkhand. Instead of inviting bids separately for engineering, procurement and construction, the company has given BTG (boiler turbine and gas) package to the state-owned Bhel as this helps power companies save costs. The rest of the plant will be built by Delhi-based Infrastructure company Punj Llyod. Goindwal Sahib will be the first private power plant in Punjab.

Hindujas to invest $10 bn in power

February 1, 2010. Diversified Hinduja Group said that it is close to acquiring an Indian construction firm in a bid to secure a foothold in India's fast growing infrastructure sector, especially roads, and also announced an investment of USD 10 billion (around Rs 462 bn) in the power sector. The group has already announced plan to invest USD 50 billion in power, realty, auto, healthcare and oil and gas projects in India, whose appetite for infrastructure funds is pegged at about USD 500 billion over the next four-five years.

Transmission / Distribution / Trade

Lower coal loading hits SEC Rly

February 1, 2010. At a time when many zonal railways have revised upwards their freight loading targets for 2009-10, South East Central Railway (SECR), the country's largest freight-loading zonal railway, has revised the targets downward – from 142 million tonnes (mt) to 135 mt – for the same period. The reason: Coal loading, which accounts for more than 80 per cent of SECR's freight loading, is not increasing. If at all, it has declined. The coal throughput till December at 72.4 mt was lower, marginally though, from that (72.9 mt) in the same period of last year. The shortfall from the current year's pro-rata target of 74 mt for the period was about 1.6 mt. At this rate, it is apprehended, SECR's coal traffic by March might barely touch the last year's level of 100 mt or so. The new power plants being set up at the pitheads in areas served by SECR do not necessarily depend on SECR for coal transportation. For example, as inquiries reveal, in the current year SECR stands to lose an estimated 6 mt of incremental coal traffic, with NTPC having installed merry-go-round facility for bringing coal from the mines to its newly-commissioned Sipat plant. For short distances, many customers prefer road movement to rail transportation with the railways charging minimum for 100 km.

CESC leads race for power distribution in Patna

January 27, 2010. In an interesting turn of events, CESC Ltd is now leading the race to secure power distribution licence for Patna. The Kolkata-based private power utility was ranked second lowest to Mumbai-based Glodyne Power, in terms of financial bids. The bids were invited by Bihar State Electricity Board (BSEB). Earlier, BSEB announced its plan to appoint franchisees for power distributor in Patna, Gaya, Muzaffarpur and Bhagalpur circles. After due evaluation of the technical bids in mid=2009, three companies –- Glodyne, CESC and Reliance-Infra – submitted the financial bids for Patna, the most lucrative circle in the State. In October 2009, Glodyne emerged as the lowest bidder for Patna and Gaya circles inviting severe criticism from CESC which even threatened to go to Court allegedly contesting the technical competence of Glodyne in power distribution.

Policy / Performance

JSW Energy to invest over Rs 500 bn in 5 yrs: S S Rao

February 1, 2010. JSW Energy, part of the USD 8-billion JSW Group said the company plans to scale up its capacity to 11,390 MW which entails an investment of over Rs 500 bn. The company now has a capacity of 995 MW and aims to scale it up to 3,140 MW by 2011. By 2015, the total capacity would be 11,390 MW, JSW Energy Joint MD and CEO S S Rao told reporters here. Every 1 MW capacity addition needs an investment of Rs 50 mn, which means JSW Energy would invest over Rs 500 bn in the next five years.

10-fold n-power capacity scale-up on

January 30, 2010. Plans to scale up India's nuclear capacity nearly ten-fold over the next decade has got underway, with the Centre according ‘in principle' approval to over 38,000 MWe (mega watt electrical) of new reactor capacity. Imported Light Water Reactor units ranging from 1,000 MWe to 1,650 MWe from Russia, France and the US would make for over 80 per cent of the envisaged capacity, with indigenous Pressurised Heavy Water Reactors of 700MWe accounting for the rest. The units are planned to be constructed with a gestation period of about six years from the first pour of concrete to commercial operation. The plan is to start work on the first set of twin units at these sites by 2012.

Energy News Monitor I Volume I Issue 33

Site clearances, including primary environmental clearance, have been received for the second phase of the Koodankulam project (four additional Russian ‘VVER' series of reactors) and the Jaitapur site (in Maharashtra), where French nuclear major Areva NP would set up its ‘EPR' reactor units. State-owned Nuclear Power Corporation of India Ltd had initially set itself a target of achieving a total installed capacity of 20,000 MWe by 2020.

NTPC undertakes 17 projects to have 75 GW capacity by 2017

January 29, 2010. State-run utility NTPC has undertaken 17 projects across the country for capacity addition of 17,930 MW of power in the road map to achieve 75,000 MW generation capacity by 2017. Land, water, fuel supply and power purchase agreements all are in place for these projects, which are expected to come up progressively in next 2-3 years say under the Eleventh or early Twelfth year plan. NTPC has also invited bids for 9,632 MW of capacity which are in 11 projects, and we expect the awards to happen within a period of 6 months to one year. There are 4,245 MW capacity projects where feasibility reports are ready and these projects are very soon going to be awarded for which NIT is to be issued, she said. At present NTPC generates 30,644 MW power, but our target is to reach 75,000 MW capacity generation by 2017.

AP urged to review power tariff hike plan

January 28, 2010. The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) has urged the State Government to keep in abeyance the proposed power tariff hike in view of the ongoing bandhs and agitations. The industry, trade and commerce are already affected due to repeated bandhs, unrest and agitations, causing severe impact on the production targets. Transport of employees, raw materials and finished products are also badly affected and due to forceful closure of factories, industrial, business and commercial establishments, the economic activity has suffered enormously.

Rly hikes capacity of power project proposed in Bengal

January 28, 2010. The Indian Railways is planning to set up a 1,320 MW power plant at Adra in West Bengal. Railway Budget for 2009-10 had proposed a 1,000 MW plant at the site. The Railways will soon appoint a consultant to prepare a detailed report and advise on inviting tariff-based bids for the project. The consultant will also advise on finding land, garnering resources, forming special purpose vehicle and joint venture for the project. The Adra project is seen as Railway Minister Mamata Banerjee's answer to her predecessor Lalu Prasad's plan to set up a 1,000 MW plant at Nabinagar Bihar. NTPC and Indian Railways have formed a 51:49 joint venture for the Nabinagar project. Indian Railways buys power from State grids to run its engines, signal systems and other civic works.

Power shortage: Manipur pins hope on projects in Assam, Tripura

January 28 2010. Faced with shortage of power perpetually, Manipur is keeping alive its hope of solving the problem once the two power projects being constructed at Bongaigaon in Assam and Pallatana in Tripura are commissioned and gets its share of around 90 megawatt. The thermal power project being constructed at Bongaigaon would have a generating capacity of 750 megawatt. On the basis of the respective share of power due to be received by each of the Northeastern States, Manipur hopes that it would get around 47 megawatt. While from the Pallatana JB Power Project in Tripura, the State expects to receive around 43 megawatt as its power share. Thus, from these two power projects which are being targeted to be commissioned 2011, Manipur looks forward to receiving around 90 megawatt to solve its perpetual problem of power shortage. Over and above this, Manipur is also expected to receive its power share from the 600 megawatt generating capacity Kameng Hydro Electric Power Project and the 2000 megawatt generating capacity Lower Subansari Hydro Electric Power Project, the source informed, adding that with that there would be a great change in the scenario of power transmission and generation of Manipur by 2011.

UPCL to set up hydel projects

January 27, 2010. In a bid to meet increasing demand of power in the state, Uttar Pradesh Power Corporation Limited has decided to set up small hydro-power projects through the private sector. As per the new energy policy framed by the state government, minor hydro-projects will be set up at toe of canals and bunds with the cooperation of the private sector. It was decided that Non-conventional Energy Development Authority (NEDA) will identify 15 projects and Jal Vidyut Utpadan Nigam will identify 21.

Steel Ministry keen on pushing ahead coal jt venture

January 27, 2010. The Steel Minister is set to take up the issue of making operational the joint venture International Coal Ventures Ltd (ICVL) with his coal counterpart. ICVL was formed two years ago as a venture between SAIL, Rashtriya Ispat Nigam Ltd, NMDC Ltd, Coal India and NTPC. The aim of the joint venture was to explore and acquire coal blocks overseas. The company was formed with a corpus of Rs 100 bn with SAIL being the major contributor. However, ICVL has made little headway in the past two years.

INTERNATIONAL

OIL & GAS

Upstream

GE oil & gas boosts Lobito Tomboco output

February 2, 2010. GE Oil & Gas has successfully completed a subsea equipment upgrade that is helping to increase production in a deepwater oil field off the coast of Angola. Under a contract with Cabinda Gulf Co. of Angola, a subsidiary of U.S. oil company Chevron, GE's Drilling & Production business applied the latest VetcoGray technology to retrofit existing subsea trees in the Lobito Tomboco field.

OGX's offshore Brazil find contains 100-200MM barrels

February 1, 2010. OGX has completed the drilling of well 1-OGX-4-RJS, located in block BM-C-42, in the shallow waters of the southern part of the Campos Basin. Additionally, OGX has identified an oil-bearing interval in the Aptian section of well 1-OGX-5-RJS, located in the BM-C-43 block, also situated in the shallow waters of the southern part of the Campos Basin.

OGDCL reports gas discovery, onshore Pakistan

January 29, 2010. The Guddu Block Joint Venture comprising of Oil and Gas Development Company Limited (OGDCL) as Operator (70%); IPR (25%); and Government Holdings (Pvt.) Limited (5% carried), has discovered gas from exploratory well Maru-1, which is located in District Ghotki, Sindh Province, onshore Pakistan. The Maru discovery well was drilled down to a depth of 794 meters, with the objective of testing the hydrocarbon potential of Pirkoh Limestone formation, whereby sizeable reserves of gas have been found.

U.S. oil rig count rises to highest level since 1993

January 29, 2010. Crude oil rigs operating in the U.S. increased to the highest level in 16 years as drilling rose in Texas and the Dakotas, according to data published by Baker Hughes Inc. Oil rigs rose by seven to 444, the highest level since the week ended Dec. 17, 1993. The count has more than doubled since June, when it bottomed out at 179. Oil and natural gas rigs in Texas, the state with more active rigs than any other, rose by 10 to 538. It had 320 in June.

South Korean gas firm signs on to develop Iraqi oil field

January 29, 2010. The state-run Korea Gas Corp. (KOGAS) and its partners have signed a deal to explore the Badra oil field in Iraq, the company said Thursday. An international consortium including KOGAS and Gazprom of Russia has won a license to develop the Iraqi Badra oil field, which holds reserves of 2.4 billion barrels. KOGAS has a 22.5 percent stake in the consortium, while Gazprom holds a 30 percent share and Malaysia's Petronas holds 15 percent. Turkish TPAO holds another 7.5 percent. With the deal, KOGAS has secured a total of 20 million barrels over the next 20 years.

BP interested in Brazil assets, China projects

January 29, 2010. BP Plc is interested in acquiring assets in Brazil and is working with China Petrochemical Corp. to expand in Asia. BP overtook Royal Dutch Shell Plc as Europe’s largest oil company by market value. Analysts criticized BP last year for missing the chance to develop Brazil’s pre-salt offshore region. The Santos basin contains the Tupi field, the largest oil discovery in the Americas since Mexico’s Cantarell in 1976. BP’s largest project in Brazil is production of ethanol. BP would be interested in any assets being offered by ConocoPhillips, the third-largest U.S. oil company. ConocoPhillips said in October it will try to sell about $10 billion of assets worldwide over two years.

Strike extends option to acquire Philippines oil field

January 27, 2010. Strike Energy Limited has extended the expiry date on the option it holds for the acquisition of an 80 percent stake in the Cadlao oil field in the Republic of the Philippines. Strike has agreed with Blade Petroleum, which holds the Cadlao interest, to extend the existing option period from January 31, 2010 to February 28, 2010. The extension will enable further time for Strike to complete its due diligence review of the project.

Faroe Petroleum gets new exploration licence in Norway

January 27, 2010. Faroe Petroleum Plc said it was awarded a new exploration licence in Norway and was prequalified as an operator for the Norwegian Continental Shelf. The oil and gas explorer said significant hydrocarbon potential had been identified within the new Norwegian Sea licence, PL477B, located adjacent to the company's existing PL477 Cooper licence. Faroe Petroleum was awarded a 30 percent interest in the licence.

Pioneer adds 52MM barrels of proved reserves

January 27, 2010. Pioneer added proved reserves totaling 52 million barrels oil equivalent (MMBOE) during 2009 from discoveries, extensions and technical revisions. These additions equate to 114% of full-year 2009 production. The drillbit finding and development (F&D) cost for the proved reserve additions was $7.42 per barrel oil equivalent (BOE), a continuing downward trend in the Company’s drillbit F&D cost.

Downstream

Foster Wheeler wins Uganda refinery study

February 2, 2010. Foster Wheeler AG announced that its Global Engineering and Construction Group has been awarded a contract by the Government of the Republic of Uganda to undertake a feasibility study for the development of an oil refinery with a capacity of up to 150,000 barrels per day in Uganda. The Foster Wheeler contract value for this project was not disclosed and will be included in the company's fourth-quarter 2009 bookings.

Voser’s Shell overhaul may signal output revival in BP fight

February 1, 2010. Peter Voser is using lessons from his two-year stint rescuing Swiss engineering company ABB Ltd. from near bankruptcy to turn around Royal Dutch Shell Plc by selling assets, cutting thousands of jobs and speeding up decisions. Not only has Shell suffered six years of falling output, it’s been overtaken as Europe’s biggest energy producer in terms of market value by BP Plc for the first time since 2006. In recent years, Shell has struggled to maintain output levels because of lackluster exploration efforts and the company’s reluctance to do the major deals that helped rivals BP and Exxon Mobil Corp. bulk up.

GE to supply compressor stations for Slovak project

February 1, 2010. Slovensky Plynarensky Priemysel (SPP), a leading Slovak energy company, has awarded GE Oil & Gas a $102 million (EUR68 million) contract to upgrade three pipeline compression stations, bringing the facilities into compliance with new European Union directives to decrease carbon dioxide and nitrous oxide emissions. GE will supply SPP with advanced dry low emissions (DLE) systems technology and additional equipment for the conversion of seven GE PGT25 gas turbines and one PCL602 gas compressor.

Chavez, Eni to spend $18 bn to pump, refine oil

January 27, 2010. Eni SpA, Italy’s biggest oil company, and Petroleos de Venezuela SA, the South American country’s state-owned oil company, agreed to develop almost $18 billion worth of projects to pump and refine oil in Venezuela. The companies’ joint venture will start producing crude in the Orinoco Belt in central Venezuela. The venture expects to pump 240,000 barrels a day after spending $8.3 billion to develop the Junin 5 block. First oil will be pumped in 2013, Eni said today on its Web site. It will reach full production in 2016. Rome-based Eni is seeking oil projects abroad to maintain output. Venezuela, to make up for declining production in its aging Lake Maracaibo fields, is inviting foreign companies to become minority partners in the Orinoco. Eni also plans to build a $9.3 billion, 350,000 barrel-a- day refinery to convert crude oil from the existing Petromonagas project in the Orinoco into higher-value products.

Transportation / Trade

Petrobras inaugurates Paulinia Natural Gas Pipeline

February 1, 2010. Chief of Staff, Dilma Rousseff, and Petrobras' director for Gas and Energy, Graça Foster, inaugurated the Paulínia (SP - Jacutinga (MG) Gas Pipeline. With capacity to transport 5 million cubic meters of gas per day and 93 km in length, the gas pipeline will supply natural gas to towns in the Southern area of the state of Minas Gerais. A total of R$275 million were invested in the construction of the project, which belongs to the so-called PAC (the Growth Acceleration Program).

Saudi Aramco opens office in India

January 29, 2010. Saudi Aramco, the world's biggest oil company, has opened a new office in India to target business opportunities. The new Aramco Overseas Company office will focus on companies involved in manufacturing and contracting material for Saudi Aramco, creating significant opportunities for Indian businesses. This comes at a time when energy sector engagements between India and Saudi Arabia are on the rise, with Saudi crude exports to India jumping from just around $500 million in 2006 to $23.5 billion in 2008.

Sakhalin Energy delivers 100^th cargo of Russian LNG

January 29, 2010. The hundredth tanker carrying Russian liquefied natural gas, shipped from the LNG plant in Prigorodnoye, has arrived in Japan. The cargo was delivered to Kyushu Electric by Grand Aniva, the same LNG carrier that transported the first LNG from Sakhalin. Over 5.5 million tonnes of LNG have been shipped since Russia's first LNG plant began operating less than a year ago in February 2009. The major destination for Sakhalin LNG last year was Japan, representing more than 50% of volume of the delivered LNG. Remaining quantities of LNG were shipped to South Korea, India, Kuwait, China and Taiwan.

Policy / Performance

Iraqi Kurd official confirms Nabucco supply talks

February 2, 2010. Iraq's Kurdistan Regional Government is in talks with three companies to supply natural gas to the Nabucco pipeline, the region's oil minister said. Nabucco, which will bypass Russia by carrying gas from the Caspian region to Europe, has faced concerns it may struggle to find the quantities needed to fill the pipeline. The minister wouldn't disclose the companies involved, but Austria's OMV AG and Hungary's MOL Nyrt. are both investors in both the KRG and the Nabucco consortium. The KRG estimates its soil could hold 200 trillion cubic feet of recoverable gas reserves. A final investment decision for the 3,300-kilometer pipeline is due by year end with completion expected in 2015.

Total to end oil-refining operations at Flanders plant for good

February 2, 2010. Total SA, Europe’s largest refiner, plans to halt refining operations at its idle Flanders plant permanently after the recession eroded demand for oil products. Total said in an earlier statement it would announce a plan for the Flanders refinery near Dunkirk before the end of June. It stopped short of confirming a permanent shutdown after the government urged the company to protect the region’s economy and jobs. The plant has been idle since September.

China to raise resource acquisitions as car, home sales jump

February 2, 2010. China, the world’s largest metal consumer, will add to last year’s record $32 billion spending on resource acquisitions as demand for iron ore, copper and oil soars with the fastest economic growth since 2007. Chinese companies will hunt for iron ore, coal, oil, copper and gold assets, said Jing Ulrich, the chairwoman of China equities and commodities at JPMorgan Chase & Co. in Hong Kong.

China Minmetals Corp. and China Petrochemical Corp. led an acquisition spree last year, as companies snapped up zinc mines in Australia, oil reserves in Nigeria, and gold deposits in the Philippines. Owning resources will give China more control over pricing and reduce its dependence on suppliers including BHP Billiton Ltd., the world’s largest mining company.

Saudi Arabia may raise March Asia oil prices as cracks gain

February 2, 2010. Saudi Arabian Oil Co, the world’s biggest state-owned producer, may raise its March official prices for crude sold to Asia as fuel demand increases boost processing profits, refinery officials said. Arab Heavy and Arab Medium, Saudi Arabian Oil’s densest export grades, may be set at 12.5 cents a barrel higher than February, according to the median levels in a survey of refiners from South Korea, Japan, China, and India.

NPRA challenges Calif. Low Carbon Fuel Standard

February 2, 2010. NPRA, the National Petrochemical & Refiners Association filed a legal challenge against the California Air Resources Board (CARB) regarding California's Low Carbon Fuel Standard (LCFS). The fuel prohibited from use in California will simply be used elsewhere, which will result in increasing overall GHG emissions as a result of less stringent environmental standards in places those fuels would ultimately be consumed and of increased GHG emissions from increased transportation distances it said.

Budget's $26.2 bn in extra taxes favors Non-US refiners - NPRA

February 1, 2010. NPRA, the National Petrochemical & Refiners Association, took issue with a proposed $26.2 billion tax increase on the oil, gas and refining community contained with the President Obama's annual budget. The budget proposal would eliminate Section 199 manufacturing tax credits NPRA members receive under the American Jobs Creation Act of 2004, placing them at a unique disadvantage with other domestic businesses and foreign energy producers. The proposal also eliminates LIFO accounting for all domestic businesses.

Russian oil tsar backs zero duty as debate heats up

February 1, 2010. Russian oil majors can be sure of keeping a blanket zero duty on exports from East Siberia, the country's powerful energy chief said on Monday, as debate heats up with fiscal hawks on taxing the lucrative oil sector.

Deputy Prime Minister Igor Sechin said he would convince opponents of the zero duty, which oil firms say is crucial for investment in the remote fields on which Russian output growth depends, that lost budget revenues can be replaced elsewhere. Russia is currently the only country pumping more than 10 million barrels per day of crude.

Obama budget seeks to end oil, gas subsidies

February 1, 2010. The Obama administration on Monday asked Congress for a second time to end some $36.5 billion in subsidies for oil and gas companies, saying it would help fight global warming. In its proposed budget for the government's 2011 spending year that starts October 1, the administration said eliminating the subsidies would "foster the clean energy economy of the future and reduce our reliance on fossil fuels that contribute to climate change." The industry tax breaks that would be lost include: deductions for certain drilling costs, tax credits for low-volume oil and gas wells and a manufacturing tax deduction for oil and gas companies.

GE supplies equipment for major gas project in Abu Dhabi

February 1, 2010. GE Oil & Gas has been awarded a contract worth over $200 million, by Hyundai Engineering & Construction Company (HDEC), to supply eight gas turbines and related services for the Abu Dhabi Gas Industries (GASCO) integrated gas development (IGD) project at Habshan in Abu Dhabi. Supporting the government's initiative to meet the rising demand for energy within the Emirate, the Habshan 5 IGD project is one of the largest gas processing complexes in the world. Combined, the eight GE Frame 6B gas turbine units will provide more than 250 megawatts of power for the Habshan 5 plant, which will have four gas processing trains and will add a total processing capacity of 2,000 Million Cubic Feet (MCFD) of gas per day.

Poland secures more gas supplies from Gazprom

January 29, 2010. Poland's gas monopoly PGNiG has signed a deal with Russian Gazprom to increase gas deliveries to Poland and extend a contract for transit of gas. The deal extends until 2037 a gas delivery contract signed in 1996 for transport of gas from Russia to Poland. It also increases delivery to 10.2 billion cubic meters annually. The deal also extends until 2045 a contract for gas transit through Poland through the Yamal pipeline. Warsaw and Moscow were in negotiations for several months in the talks focused on increasing gas supplies from 8 to 10.2 billion cubic meters, Polish Radio reported. Poland negotiated the deal after it stopped receiving 2.3 billion cubic meters of gas last year from the Russian-Ukrainian company RosUkr Energo.

Alaska Pipeline Project files open season plan

January 29, 2010. The Alaska Pipeline Project has filed its plan with the U.S. Federal Energy Regulatory Commission (FERC) to obtain approval to conduct the first natural gas pipeline open season to develop Alaska's vast natural gas resources. The project is a joint effort between TransCanada Corporation and Exxon Mobil Corporation to develop a natural gas pipeline under the Alaska Gasline Inducement Act (AGIA). The open season process initiated with FERC applies to the portion of the project in the United States. A separate but coordinated open season for the Canadian portion of the project will be conducted concurrently with the U.S. open season.

Senate bill gives state bigger role in LNG proposals

January 29, 2010. The California Senate approved a bill that would give the state a larger role in monitoring and assessing future applications to build liquefied natural gas terminals. Sen. Joe Simitian, D-Palo Alto, said he hopes the current lull in interest in such projects will enable lawmakers to put in place requirements for state oversight that did not exist three years ago, when a proposal by the Australian energy firm BHP Billiton to build a terminal off the Oxnard coast created a storm of controversy.

Australia Pacific lodges EIS for Queensland gas fields

January 29, 2010. Australia Pacific LNG has lodged its draft Environmental Impact Statement (EIS) for its coal seam gas to liquefied natural gas project with the Queensland Government. The EIS will now be assessed by the Queensland Government for compliance with the Terms of Reference set by the Coordinator-General prior to its release for public consultation at a future date. The EIS addresses the project's maximum development case and covers the gas fields in southern central Queensland, the 450km gas transmission pipeline and a four-production-train LNG plant near Laird Point on Curtis Island in Gladstone. The Australia Pacific LNG EIS includes an assessment of the cumulative impacts of the proposed CSG to LNG industry on the communities within the Project area.

Unnamed Indian firm eyes $5 bn Malaysia refinery

January 29, 2010. A big Indian company has expressed interest to build an oil refinery in Malaysia's northern state of Perak involving a US$5 billion investment, Malaysian Chief Minister said. The state government had signed an agreement of understanding to realize the project with the company during Prime Minister Najib Tun Razak's visit to India recently.

Chevron buys more time offshore Cambodia

January 29, 2010. Chevron Corp has extended its offshore energy exploration deal with the Cambodian government, but the company provided no other details citing "commercial reasons." Block A, an area off Cambodia's coast in the Gulf of Thailand, is thought to be one of the nation's most promising areas for oil and gas exploration in the coming years. Announcement of the deal after almost a year of negotiations with the Cambodian government puts an end to speculation that Chevron might quit the country. Chevron has spent $125 million and drilled 15 exploratory wells in Block A since 2002. The latest date for production, which has been pushed back several times, is 2013.

Hungary signs South Stream deal with Russia

January 29, 2010. The state-owned Hungarian Development Bank set up a joint venture with the Russian energy giant Gazprom in Budapest, laying the groundwork for the construction of the local stretch of the planned South Stream gas pipeline. Russia hopes South Stream - seen as a rival to the EU-backed Nabucco pipeline project - will improve its access to energy-hungry European natural gas markets. The Russian pipeline would cut the current transit country Ukraine, whose disputes with Russia over pricing have led to repeated interruptions to supplies, out of the supply chain. Hungarian Prime Minister Gordon Bajnai and Russia's first Deputy Prime Minister Viktor Zubkov of Russia witnessed the signing of the contract. The new firm South Stream Hungary, a 50-50 joint venture, will first prepare a feasibility study for the Hungarian stretch of South Stream, Gazprom said in a statement.

Iran says U.S. sanctions won’t halt gasoline supplies

January 29, 2010. U.S. legislation to impose gasoline sanctions on Iran over its disputed nuclear program won’t succeed in halting fuel supplies, an Oil Ministry official said. The U.S. Senate unanimously passed legislation to expand sanctions on foreign companies that invest in Iran’s energy sector. The measure requires sanctions against foreign companies that sell refined petroleum to Iran or help develop its refining capacity. The bill needs to be reconciled with similar legislation passed by the U.S. House in December. Iran has come under three sets of United Nations sanctions since December 2006 because of nuclear developments that the U.S. and some western allies claim are aimed at building atomic weapons.

Oil demand has peaked in developed world: IEA

January 28, 2010. Oil use in rich industrialized countries will never return to 2006 and 2007 levels because of more fuel efficiency and the use of alternatives, the chief economist of the International Energy Agency said. Flat or declining OECD demand may ease any strain on oil prices caused by ever-growing consumption in emerging economies. The Organization for Economic Cooperation and Development (OECD) countries will account for 53 percent of world demand in 2010, according to the IEA.

Shale gas is U.S. energy "game changer" says BP CEO

January 28, 2010. New technologies to extract gas from shale rock have altered the U.S. energy outlook for the next 100 years, Tony Hayward, chief executive of BP, said. Energy chiefs speaking at the World Economic Forum differed about the prospects for future oil supplies -- with Iraq placed to account for up to 10 percent of that -- but agreed new "unconventional gas" would be a huge fillip. Unconventional gas includes natural gas extracted from shale and methane reserves in coal mines, which together are set to play a huge role in satisfying rising global energy demand.

Saudis say don't worry about peak oil

January 28, 2010. There is still plenty of oil in the ground and the world should put aside fears about "peak oil," the head of the Saudi state oil firm Saudi Aramco said. The peak oil theory that oil supply is at or near its peak gained currency when prices zoomed to a record of nearly $150 a barrel in 2008. The issue remains a concern for many in the industry. Total's chief executive said the world would struggle to surpass 95 million barrels per day (BPD) in the future, 10 percent above present levels.

Japan oil imports slip behind China’s as demand drops

January 27, 2010. Japan dropped to third place among oil importers, behind the U.S. and China, in 2009 as its stagnant economy and aging population slashed fuel demand. Japan shipped in 213 million kiloliters, or about 3.67 million barrels a day, 11.9 percent less than a year earlier, according to a preliminary finance ministry trade report released in Tokyo. That compares with the 4.1 million barrels a day China imported last year, according to figures from the General Administration of Customs in Beijing on Jan. 10. Tokyo Electric Power Co. and nine other utilities burned less crude and fuel oil last year, according to the Federation of Electric Power Companies, as weak industrial output cut the nation’s electricity requirements.

Dead Sea oil exploration hinged on financial guarantee

January 27, 2010. Oil firm Trans-Global will have two months to present a financial guarantee in order to maintain its hold on an oil concession in the Dead Sea area, Jordan's Natural Resources Authority (NRA) said. US-based Trans-Global is to submit a $2 million financial guarantee by the end of March to continue its oil exploration efforts. If it fails to submit the guarantee, its concession in the area will end. The 1996 production sharing agreement signed between the NRA and Trans-Global, which was ratified by Parliament in 1997, gave the company the concession to explore an area in the southern Dead Sea in three phases over several years. The agreement stipulates that if an actual oil discovery is made, the concession holder has the right to develop the area for 25 years.

China eyes gas deal with Israel consortium

January 27, 2010. China has shown interest in purchasing natural gas from a consortium drilling in the Tamar area off Israel's northern shore. Tshuva's Delek Group conglomerate has a stake in Tamar through Delek Drilling and Avner Oil Exploration which each own 15.625 percent. Noble Energy leads the consortium drilling at the Tamar-1 and Tamar-2 sites off the northern port of Haifa and the Dalit site 60 km off the coast of Hadera, a city south of Haifa. Isramco Negev and Dor Gas Exploration are also partners in the consortium.

Carbon monitors might mean outages, U.S. refiners say

January 27, 2010. U.S. refineries will probably have more outages if the Environmental Protection Agency compels them to install equipment to monitor greenhouse gas emissions this year, an oil industry group said.

The EPA announced in September that companies responsible for 85 percent of U.S. greenhouse gases must start monitoring their emissions this year and report them annually to the agency from 2011.

The data from these reports would lay the foundation for a cap-and-trade system, favored by President Barack Obama and congressional Democrats, which creates a limited number of carbon dioxide permits that companies can buy and sell.

Eco investors target Shale drillers

January 27, 2010. A group of shareholders who focus on the environment said they are targeting companies operating in the Marcellus Shale to ensure development of natural gas does not pollute or endanger human health. The shareholder proposal campaign, aimed at 12 companies including Chesapeake Energy Corp, EOG Resources Inc and Exxon Mobil Corp, was sparked by mounting worry about chemicals used in a process to extract gas from rock called hydraulic fracturing, the groups said. Hydraulic fracturing -- where water, sand and chemicals are pumped into formations at pressures high enough to crack the rock and allow gas to escape -- has helped fuel a drilling boom in the United States.

POWER

Generation

Nigerian Power outage deepens as generation relapses to 3 GW

February 2, 2010. Power generation in the country has dropped by about 700 megawatts, deepening the incessant power outages suffered by the nation after the Federal Government failed to meet its self-imposed target of 6,000 megawatts by end of December 2009. The drop is as a result of shortage in gas supply. Presently, Sapele and Delta power plants are shut down, while Egbin can only generate 600 megawatts. At Omotosho power plant, only one unit is working while Olorunsogo power plant is down. The drop in Egbin power plant capacity is as a result of the blow out at Utorogun gas plant which affected gas supply to it.

Xstrata plans $13.3 bn coal expansion in Australia

January 31, 2010. Xstrata, the world's top thermal coal exporter, is considering up to A$15 billion ($13.3 billion) investment to boost output at its Australian thermal coal project to 100 million metric tones a year. Xstrata is seeking an environmental approval for the first phase of its Wandoan project, which is expected to start production in 2014 and export up to 30 million metric tones of coal a year from the proposed Wiggins Island terminal. Xstrata has identified three exploration targets around Wandoan located in the Surat basin in the north east state of Queensland, which potentially holds between 4 billion and 7 billion metric tones of thermal coal.

Japan's TEPCO fuel cuts oil consumption plan

January 29, 2010. Tokyo Electric Power Co cut its thermal fuel consumption plans for the current fiscal year, as the return to commercial operations of two units at its Kashiwazaki-Kariwa nuclear plant lessen its fossil fuel needs. Asia's largest utility said on Friday it plans to consume 4.87 million kilolitres of oil in the financial year that ends in March, less than half the initial plan of 10.8 million kl it announced last March. Last year, TEPCO restarted two of the seven reactors at its Kashiwazaki-Kariwa nuclear plant, the world's largest, after it was forced to shut the entire complex following a major earthquake in northern Japan in 2007.

China coal-price ascent stalls as shortages ease

January 27, 2010. Thermal coal prices in Qinhuangdao, China's top coal-shipping port, held steady halting a four-month rise as improving weather conditions eased coal and power shortages. Many factories close shop around the one-week Lunar New Year holiday, which falls in mid-February this year, when workers return to their hometowns for celebration. Prices of coal with calorific value of 5,800 kcal/kg (NAR) were unchanged from a week earlier at 840 yuan to 850 yuan ($123.1 - $124.5) a tonne, after having risen, according to the Qinhuangdao Seaborne Coal Market.

ENEL's Slovak unit ups nuclear output in 2009

January 27, 2010. Slovak utility Slovenske Elektrarne (SE), a unit of Italy's said it increased overall production at its two nuclear power plants for a third straight year in 2009. Net power output from the four reactors at the Jaslovske Bohunice and Mochovce nuclear power plants grew to 13,055 GWh in 2009 versus 11,395 GWh in 2007, the utility said. The power firm, which has already decommissioned two older blocks at Bohunice, wants to boost the plant's capacity to 1,000 MW by 2010.

Transmission / Distribution / Trade

Kansai Electric Power researches technology for power system stabilization

February 2, 2010. Kansai Electric Power Co., Inc. is pursuing development of technology applying storage batteries to stabilize power systems, in anticipation of the input of small-scale power sources such as residential photovoltaic generation systems. The program is testing a method for stabilization of frequency by input of power from the storage batteries in correspondence with fluctuation of the supply-demand balance in the entire power system, as opposed to the approach of installing storage batteries at each source for conversion of the output into stable power. The utility intends to make widespread disclosure of the knowledge obtained through this research and thereby to contribute to the stable supply of power and the diffusion of new energy.

Policy / Performance

Five companies bid to build new nuclear plant in Lithuania

February 2, 2010. The Lithuanian government has announced that it selected five companies that will make bids to build the country's new nuclear power plant.

The new power plant will see cooperation among the three Baltic States to build a new nuclear plant to replace the one at Ignalina that was shut down this year in line with EU mandates. The EU had been concerned about the safety of the Chernobyl-style plant.

The project has met with controversy as the three Baltic States and Poland bicker about how much power each country will be allocated. Plans for construction have been significantly delayed by the controversy.

Investors urged to put up nuclear plant in Philippines

February 2, 2010. The Provincial Government of Cebu in Philippines is encouraging investors in the power industry to consider putting up a nuclear plant in Cebu to provide a lasting solution to the power crisis in the Visayas grid.

Cebu has been interested in renewable energy and other forms of energy to address the power crisis now hitting Cebu and the rest of the provinces under said grid.

Poland seeks buyer for PAK utility, coal mines

February 1, 2010. Poland is seeking a buyer for its 50 percent stake in energy producer Patnow-Adamow-Konin (PAK) and 85 percent stakes in lignite mines in Patnow and Konin, treasury ministry. Potential buyers have until March 15 to file bids. Polish media mogul Zygmunt Solorz-Zak owns 47 percent stake in PAK, but holds operational control over the group. Central and Eastern Europe's largest utility CEZ has said previously it would be interested in the PAK's stake.

Egypt announces tender to build thermal power plant

February 1, 2010. Egypt's electricity ministry invited local and international investors to develop the country's first privately-owned thermal power plant on a build-operate-own (BOO) basis. The plant will be located in Beheira, northwest of Cairo, and include two combined cycle units, each with 750 megawatt capacity, a report on the state news agency MENA said.

Obama said to seek $54 bn in nuclear-power loans

January 29, 2010. President Barack Obama, acting on a pledge to support nuclear power, will propose tripling U.S. loan guarantees for new reactors to more than $54 billion. The additional loan guarantees in Obama’s budget are part of an effort to bolster nuclear-power production after the president called for doing so in his State of the Union address. For the 2011 budget, the department will add $36 billion to the $18.5 billion already approved for nuclear-power plant loan guarantees. Nuclear plants accounted for 20 percent of U.S. power generation in 2008, according to the Energy Department. Generation was off 13 percent through October of 2009 compared to the same period in 2007, before the worst economic slump since the Great Depression hit the U.S. economy.

Areva sees "significant" 2010 order backlog growth

January 28, 2010. Areva's sales rose 5.4 percent in 2009, driven by its reactors and services unit, and it forecast "significant growth" in order backlog and revenue for its nuclear and renewables operations in 2010. The world's biggest maker of nuclear reactors said revenues, excluding its transmission and distribution business, which will be sold to a French consortium, reached 8.53 billion euros, with the reactors and services unit showing growth of 12.8 percent. Areva's international sales, excluding T&D, were up 9.3 percent from 2008 at 5.27 million euros.

Renewable Energy / Climate Change Trends

National

Clean, green village to get award

February 2, 2010. All the households in Kaluana village of Sirsa district have access to sanitation facilities as it has managed to get rid of the practice of open defecation. And thanks to the plantation drive, it now wears a green cap. The village school has clean and functional toilets and has a pick-up van too.

Kaluana generates electricity from its own biogas plant An official spokesman said here that the village Gram Panchayat has set new standards in sanitation and other developmental works. No wonder, the Panchayat has been selected for the first state-level award under the state incentive scheme on Sanitation (SISS) 2008-09.

REpower to supply turbines for RWE Innogy's North Sea wind farm

February 1, 2010. Suzlon Energy Ltd has said that REpower Systems AG, in which it has a 90.71 per cent stake, has signed a contract to supply 295 MW of offshore wind turbines for a wind farm in the North Sea East. REpower signed the agreement with RWE Innogy, the project company for the North Sea East project, to supply 48 turbines of 6 MW capacity.

The offshore wind farm was due to be built in the German Bight between 2011 and 2013. The wind farm would be located 35 km north of the island of Helgoland where sea 22-25-metre deep.

The Nordsee Ost (North Sea East) was the first project under the framework agreement concluded between REpower and RWE Innogy in February 2009 for the delivery of up to 250 offshore turbines. REpower would supply the nacelles and hubs from its offshore production facility in Bremerhaven, and also supply the rotor blades and towers for the project.

NTPC NVVNL to procure 1 GW solar power by 2013

January 30, 2010. NTPC Vidyut Vapyar Nigam Ltd (NVVNL), a wholly-owned trading arm of NTPC and the national nodal agency, has decided to procure solar power up to 1,000 MW by 2013.

The company will mix solar power tariff with the unallocated thermal power before pushing it into the grid for a final price of Rs 5-5.50 a unit. The Ministry of New and Renewable Energy (MNRE), in its new solar mission road map has converged state tariffs with central tariff for solar power. Across the country there will be uniform tariff for solar energy. NTPC's plan of purchasing 1,000 MW depended much on the success of national solar mission, which had envisaged 20,000 MW of solar power by 2022.

The MNRE has targeted solar energy generation of 1300 MW in the first phase of the solar mission ending 2013 and NVVNL has been appointed the nodal agency for buying the entire generation.

Moser Baer back in black on sharp recovery in solar PV biz

January 29, 2010. Moser Baer India Ltd, posted a net profit of Rs 32.3 mn for third quarter of current fiscal compared with a loss of Rs 257 mn a year ago, while giving a stable outlook for optical media business and high growth expectations from advanced formats such as Blu-ray. With sharp recovery in solar PV (photo voltaic) business – which clocked shipment revenue of Rs 2.50 bn in the third quarter, Moser Baer is also looking to revive its capacity expansion plans from next fiscal.

Global

Abu Dhabi to prepare climate change mitigation model

February 2, 2010. Abu Dhabi will prepare a model for mitigation measures in two weeks so as to reduce carbon emission as per the agreement signed during the UN Conference on climate change held in December last year. The government has decided to form a committee to study the outcome of the 15th Conference of Parties (CoP) in Copenhagen and prepare a model suggesting measures to curb green house gas emissions.

55 countries pledge mitigation targets to UN

February 2, 2010. The UN has received pledges from 55 countries, accounting for 78 per cent of global emissions, to cut their share of greenhouse gases by 2050, a development welcomed by the world body as an "important invigoration" to the Copenhagen climate talks.

Some of the world's biggest polluters, the US, China, European Union and India, have reiterated their previous pledges of cutting emissions by 2020 that were widely regarded as weak, especially the 17 per cent reduction of carbon emissions from 2020 levels proposed by the US.

Experts have noted that the current pledges are not sufficient to meet the goal set to limit global temperature rise to two degree Celsius. But the UN welcomed these countries joining the Copenhagen Accord, the agreement that was produced following the climate talks in the Danish capital in December.

Shell pushes Brazilian ethanol after scaling back wind, solar

February 2, 2010. Royal Dutch Shell Plc, the oil company that started an ethanol venture with Cosan SA Industria & Comercio in Brazil, is pushing biofuels as an alternative energy investment over wind and solar.

Shell will contribute assets including 2,740 service stations and as much as $1.93 billion to the 50-50 venture. Cosan will provide $4.93 billion of assets, including plants able to crush 60 million tons of cane a year and control of an ethanol-trading unit. The Cosan agreement may give Shell shared control of the world’s largest sugarcane produce.

Siemens invests $346 mn for green energy in India

February 2, 2010. German industrial group Siemens said it would spend $346 million (16 billion rupees) in India, mainly in renewable energy, as part of a drive to step up investment in the country.

As part of its plan, Siemens has allocated five billion rupees to build wind turbines for the energy-hungry market, the first of which should be ready by 2012. The money will be ploughed in over the next three years.

Siemens, which has a presence in many different areas in India from energy and healthcare to information technology, also said it planned to boost its workforce in the country to 25,000 by 2012 from 17,000 currently.

China wind market may help AMSC blow past estimates

February 1, 2010. American Superconductor Corp, which makes electrical systems for wind farms and turbines, is likely to report third-quarter profit above market expectations, helped by continued strength in the Chinese wind market.

China's Sinovel Wind accounts for about 75 percent of American Superconductor's total revenue. The company -- which also offers smart grid infrastructure technologies -- has a total of 13 customers in the wind industry, of which five are in China. China is leapfrogging global wind power rankings with a combination of aggressive growth targets and domestic support. It has doubled its entire installed capacity each year since 2005, according to the Global Wind Energy Council.

Obama Scraps $646 bn in ‘cap-and-trade’ revenue

February 1, 2010. President Barack Obama’s budget eliminates $646 billion in estimated revenue from a “cap-and- trade” system, as legislation to combat climate change remains stalled in Congress.

Unlike last year, his budget doesn’t estimate how much federal revenue would be raised by such a measure. Progress halted as lawmakers, already preoccupied with health-care legislation, argued over the need and costs of such a program.

Brown says UN climate negotiations were ‘flawed,’ need reform

February 1, 2010. U.K. Prime Minister Gordon Brown said the climate negotiations that failed to produce a binding treaty to rein in greenhouse gases were flawed, putting pressure on the United Nations to change the way the talks are structured.

Brown, writing in a letter to lawmakers in the U.K., said more must be done to ensure developing nations trust the UN Framework Convention on Climate Change.

Brown’s comments are important because Britain was one of the biggest proponents of the talks, and the prime minister spent four days in the Danish capital helping to broker the agreement.

China to set target for resource use, Shanghai Securities says

February 1, 2010. China will set a consumption target for natural resources, including oil and nonferrous metals, to increase the efficiency of their use, Shanghai Securities News reported. Natural resources will be measured against every unit of economic output.

China, already the world’s second-biggest energy user, is set to overtake Japan this year to be the second-largest economy.

The resource use target will be an important goal in China’s five-year economic plan through 2015. The country previously set a target of cutting energy use for each unit of GDP by one-fifth in the five years ending 2010.

SDPI and HBS ink accord on climate change

January 30, 2010. Sustainable Development Policy Institute (SDPI) and Heinrich Boll Stiftung (HBS) Pakistan inked a cooperation agreement on climate change in Pakistan called Institutional Arrangements and Alternative Sources of Energy. The agreement is aimed at developing institutional framework for implementation of national climate change related policies and building and strengthening capacity of government officials for better implementation of climate change related policies.

Novozymes to launch ethanol product

January 30, 2010. Danish biotech company Novozymes would launch in the first quarter this year a new enzyme to produce transport fuel from agricultural waste.

Novozymes has a 47 percent market share in the global enzyme industry, for use for example in the food and washing products industry, as well as bio-ethanol.

Ethanol derived from corn has faced criticism for increasing pressure on agricultural land, stoking food prices, leading to a hunt for potent enzymes which can break down tough fibers in wood chips or agricultural waste - called cellulosic ethanol.

CO₂ market value rising to $170 bn, report says

January 29, 2010. The global market for carbon dioxide emission rights will be worth $170 billion this year, an increase of 33 percent from 2009, Oslo-based environmental market analysis company Point Carbon said.

The predicted growth doesn’t depend on U.S. lawmakers approving a national cap-and-trade program, the company said in a report. It said such a program has a 20 percent chance of passing Congress this year.

Instead, trading volumes in existing carbon markets run by the European Union, the United Nations and a group of states in the U.S. Northeast are predicted to increase by 5 percent and the price of emission rights should rise from last year’s levels, Point Carbon said.

Bin Laden blames U.S. for climate change, urges end of dollar

January 29, 2010. Al-Qaeda leader Osama bin Laden blamed the U.S and other industrial nations for global climate change and called for a boycott of the U.S. dollar, in an audio tape obtained by al-Jazeera television. Bin Laden criticised George W. Bush, the former U.S. president, for rejecting the Kyoto Protocol on carbon emissions and condemned industrial nations for failing to comply with reduction targets, al-Jazeera said. The al-Qaeda leader denounced globalization’s “tragic implications.” The U.S. are the “true terrorists and therefore we should refrain from dealing the U.S. dollar and should try to get rid of this currency as early as possible,” Bin Laden said.

Iceland leads world in environmental controls, Yale study says

January 29, 2010. Iceland is the world leader in controlling pollution and managing its natural resources, a study by Yale University and Columbia University said. Switzerland, Costa Rica, Sweden and Norway were among the highest-ranked nations using criteria such as curbing greenhouse-gas emissions and reforestation, according to an environmental-performance index using data from 163 countries, the universities said in a statement yesterday.

China and India ranked 121st and 123rd, respectively, showing pressures on environmental quality made by their rapid economic growth, according to the study. About 190 nations have a deadline in two days to present their national plans for limiting greenhouse gases under the 2009 United Nations- sponsored Copenhagen Accord.

Germany aims to delay solar incentive cuts: sources

January 29, 2010. German Environment Minister Norbert Roettgen wants to delay some of the proposed cuts for solar power incentives a move that is unlikely to alter the gloomy outlook for the industry.

Roettgen's proposed 15-percent cuts in solar power incentives for roof-mounted systems are to be implemented from May 1 rather than April 1. Initial news about the cuts had sent global solar stocks tumbling, given that Germany accounts for about half the world's photovoltaic production. Solar power companies, which have counted on generous German incentives to fuel their growth, have protested against Roettgen's proposed cuts.

World may not do climate deal this year

January 29, 2010. Global climate talks may have to continue into 2011 after failing last month to agree on a Kyoto successor, the U.N.'s climate chief and Denmark's new climate minister. The world failed to commit in Copenhagen last month to succeed or extend the existing Kyoto Protocol from 2013.

The U.N.'s top climate official, Yvo de Boer, could not guarantee a deal in Mexico, the next scheduled ministerial meeting. A lack of trust and the economic crisis complicated prospects for a deal in Mexico in December, added President Felipe Calderon, the prospective host of those talks.

German biodiesel plants face closure on low sales

January 29, 2010. Germany's biodiesel industry expects to operate at around 50 percent of capacity in 2010 as taxes are making the green fuel too expensive for motorists, a biofuels industry leader said on Friday. Germany's 4.8 million tonne annual capacity biodiesel industry, Europe's largest, is estimated to have produced about 2.5 million tonnes in 2009, down from 2.7 million tonnes in 2008. About half of the 49 German biodiesel plants were not working at all and many of the operational plants were producing well under capacity, he said. Germany's government, elected in September 2009, initially said it would review green fuel taxes to stimulate biofuel sales but later said it would only freeze taxes, not cut them.

Australia’s govt to reintroduce carbon plan

January 27, 2010. Australia’s ruling Labor Party, seeking to pass a carbon trading scheme, will reintroduce the already-rejected climate change proposal to the House of Representatives when parliament returns. Global warming is at the top of Prime Minister Kevin Rudd’s agenda as he heads into a year that may see an election fought over the issue. Australia’s Senate rejected Rudd’s carbon bill for a second time in December, a day after the issue forced a leadership change in the opposition Liberal Party that saw Malcolm Turnbull replaced by Tony Abbott.

US wind power capacity up in 2009

January 27, 2010. U.S. wind power capacity soared 39 percent last year but job growth stalled as uncertainty about renewable energy policies and the recession slowed manufacturing, an industry group said. The combined power generating capacity of new U.S. wind turbines installed last year hit more than 9,900 megawatts, up from a gain of over 8,400 MW in the previous year. Total capacity hit more than 35,000 MW, or about enough to power 9.7 million homes, the American Wind Energy Association said. Total U.S. jobs associated with wind energy, stalled at 85,000, about flat from the previous year as the recession took a toll on manufacturing. In 2008, job growth surged as the sector added 35,000 positions.

Italy to unveil new solar incentives

January 27, 2010. Italy's government will unveil a much-awaited plan for new incentives for a rapidly growing solar energy sector. Italian and international investors who piled into Italian solar industry lured by the current generous scheme have been on tiptoes to find out details of the new plan which would reduce incentives as the government aims to ease the budget burden. The new incentives plan would be presented at a meeting of a government body for relations between the state and regions adding that new gas distribution system proposals would also be presented at the meeting.

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