Energy News Monitor I Volume I, Issue 38

Politics of Climate Change: Why India Wants to Support to IPCC Now?

rime Minister Manmohan Singh expressed his support for the United Nations’ Intergovernmental Panel on Climate Change and its leader, Rajendra Pachauri, at a local energy conference in New Delhi recently. The move has surprised many observers, but it may prove to be politically astute.

The IPCC’s credibility is undoubtedly in tatters today. From climategate to glaciergate, Amazongate, natural-disaster gate, Chinagate and now Africagate, the floodgates of bad science have opened. Given all that, plus the much-publicized flap between Environment Minister Jairam Ramesh and Mr. Pachauri over the science behind “melting” Himalayan glaciers weeks before the Copenhagen climate summit in December, it would superficially make sense for the government to jettison Mr. Pachauri as soon as possible—not back him.

But Delhi isn’t just backing him and the organization. At the annual flagship event of The Energy and Resources Institute (TERI)—which Mr. Pachauri has headed for almost 30 years—the Prime Minister offered to provide technical assistance through a newly established glacier research center. The government has also formed a network of scientific institutions to develop domestic science and research capacities on climate issues, the Indian Network for Climate Change Assessment.

There can’t be any more effective way to demonstrate one’s lack of confidence in the U.N.’s premiere clearing house for climate science than to offer scientific assistance to the beleaguered IPCC. Under normal times, lesser mortals could hardly have dared to offer support to the omniscient IPCC. But these are extra-ordinary times!

So, today it is in the Indian government’s interest to perpetuate a weak IPCC and a toothless Mr. Pachauri at its helm. Given the recent scientific scandals, the IPCC is hardly in a position to influence Indian policy making. The group’s continued presence will be a constant reminder of its folly and lack of credibility. No one from the IPCC can again cavalierly dismiss their critics as promoting “voodoo science” or “vested interests,” as was Mr. Pachauri’s wont. By cementing a weak IPCC in place, the Indian government may appear to be a knight in shining armor before its own constituents, having subdued a potentially threatening international agency.

Mr. Pachauri is now in his second term as the head of IPCC. He is not a climate scientist—or even a scientist at all. He is an able science administrator who has built his institute from scratch. Influential governments in the rich world probably accepted Mr. Pachauri not just for his redoubtable skill in institution-building, but also in the hope that by placing an Indian like him at the head of IPCC, he might be able to influence Indian policy. The Nobel Prize awarded to IPCC added a further coat of gloss, but it was a peace prize, not a recognition for any scientific achievement.

That’s important because after all, if countries like China and India do not subscribe to any commitment to reducing emissions, developed countries’ best efforts will not have any significant impact. Having bought the idea of man-made global warming, rich countries had to try and ensure that developing countries fell in line. And it seems the hope among policy makers in the developed world was that Mr. Pachauri may be the man to deliver India to the altar of global warming.

But the real realpolitik of today’s democratic India is such that no one can dare to be blind to the developmental aspirations of the people, least of all the political leaders, who have to face the population at elections every few years. Even if some Indian elites and political leaders wanted to sell the future of the country by agreeing to some form of restrictions on energy usage—and thus on economic growth—in the fiercely competitive world of Indian politics they would stand no chance.

The IPCC was created as a way to make the world, particularly the poor, fall in line and support expensive climate-change initiatives by overwhelming them with the apparent authority of the world’s leading technical body on the subject, backed by alleged scientific consensus. This attempt was doomed to fail, primarily because scientific inquiry does not respect consensus, and orthodoxy is anathema to scientific progress. So the fall of IPCC was inevitable, and that seed was laid at the time of its conception, in the very nature in which IPCC was sought to be built.

There is some poetic justice in this whole drama. Countries like India, which were always apprehensive of institutions like the IPCC, now might prefer the shadow of that institution. They might believe that a weak IPCC will have to allow them to draw up their own science and pursue their own interests. The rich countries that gave birth to the idea of IPCC cannot afford to disown it without exposing their own underlying design. They could try and replace its head, in the hope that the new face might be able to rebuild the credibility of the institution. But having tested blood, there is no reason why the other set of countries will let the current advantage pass so easily.

The IPCC has been checkmated, as have so many other U.N. institutions before it. This is the inevitable consequence of the desire for global government under the misguided belief that ordinary people may not know what is in their own interest and for their own future. With the deepening of democratic ideals, people power can no longer be overturned so easily. The failure of the IPCC shows that sovereignty still lies with the people, not with the aspirants for global government.

Mr. Mitra is director of the Liberty Institute, an independent think tank in New Delhi. Views are those of the author.

Courtesy: Liberty Institute, Wall Street Journal Asia, 9 February 2010

Earth Story: Liberal Economy Reduces Emission

Barun S. Mitra

ithout actually cutting down on emissions, India can make a difference by liberalising its economy.

With the opening of the climate conference in Copenhagen, India has an opportunity to change the climate of negotiations.

Surprisingly, Jairam Ramesh, the minister for environment and forest, decided to play for a draw with his statement in Parliament last week proposing voluntary reduction in India’s carbon intensity. Despite his strong assertion that India will not accept any legally binding international commitment to reduce emission, he proposed to reduce the intensity of the economy by a modest 20 to 25 per cent.

Just when the world of climate science was getting shaken by allegations of massaging of data to support claims of global warming, the minister acknowledged that Indians are among the most vulnerable to global warming, and then promised to announce domestic emission norms by 2011. Yet, he failed to drive home the point.

Between 1992 and 2005, India’s energy intensity, that is energy needed to produce a unit of GDP, improved by about 52 per cent, from 1,281 kg of oil equivalent per $1,000 of GDP in 1992 to 618 kilogram of oil equivalent (kgoe) per $1,000 by 2005. During this period, carbon intensity declined by 45 per cent, from a high of 3.15 tonne of CO₂ per $1,000 to 1.73.

These figures are impressive, and comparable to the major economies of the world, which varied in 2005 from 0.44 tonne per $1,000 for the US, 0.252 tonne for Europe area and 2.44 tonne for China.

India’s GDP in 2008 was estimated by the World Bank to be $1,217 billion (current dollar). At 2005 energy intensity level of 618.46 kgoe/$1,000, this required total energy of 752,969 million kg of oil equivalent (mkgoe).

But in 1971 energy intensity was a high 2,259 kgoe per $1,000. To achieve the GDP level of 2008 would have required 263 per cent more energy than it actually did. Likewise, at 1981 energy intensity of 1,154, would have required 87 per cent more energy. And at 1991 energy intensity of 1,409, would have required 127 per cent more energy to attain the GDP level of 2008.

The improvement in energy intensity is mirrored in carbon intensity. At 2005 carbon intensity level of 1.73 MT per $1,000, the GDP of 2008 emitted 2,094,083,144 MT of carbon. But at carbon intensity levels of 3.08 (1971), 1.96 (1981) and 2.72 (1991) the GDP of 2008, would have emitted 79 per cent, 14 per cent and 58 per cent more carbon, respectively, than it actually did.

This suggests that between 1992 and 2008, effective saving in total energy used was 127 per cent and effective decline in total carbon emission was 58 per cent, for the 2008 GDP level. The decrease in carbon intensity between 1992 and 2005 was a whopping 82 per cent from the 2005 base, and energy efficiency improved by 56 per cent, according to an analysis of the World Development Indicators.

The minister’s defensive strategy became apparent, when invoking national interest he offered to do domestically, emission reduction and emission standard, while vehemently rejecting similar measures under any international legal mandate.

The dramatic improvements in energy use since 1992 were not a coincidence. Equally, there was little conscious effort aimed at such environmental goals. The real secret of this amazing transformation is the economic liberalisation initiated during this period, which unleashed greater competition, ushered in a relatively free trade regime and facilitated investment and technology adaptation.

Globally, however, decarbonisation of the economy has been going on for the past 400 years as societies moved from fuel wood to coal, oil and electricity, driven by economic needs, leaving a safer environment in its wake.

Given this track record, rather than seeking to balance economics and environment, we need to push ahead with economic reforms with much greater vigour. We need to recognise that cleaner and safer environment is like value added products, which become accessible only with higher economic growth and prosperity.

We need to recognise that the poor are vulnerable to natural hazards, were so in the past, are in present and will be in the future, because of their poverty, quite irrespective of any change in the planet’s climate. If we are really concerned about the plight of the poor, then it is the intellectual climate that we need to change.

Even at a nominal economic growth rate of 8 per cent annually, India’s GDP will rise 150 per cent from 2008 level to over $3,000 billion by 2020. At our current carbon intensity level of 1.73 MT of CO₂per $1,000, the total carbon emission could increase by 2.5 times. But if our carbon intensity falls to European or Japanese levels, 0.252, prevalent today, the total carbon emission would fall by a sixth. This is possible at current levels of technological development.

And this could happen irrespective of whether man-made carbon is the cause of climate change or not. It would happen because of the economic need to improve energy efficiency. This is the real “business as usual” model.

The minister could emerge as a true ‘deal maker’ in climate negotiations if he succeeds in changing the intellectual climate at the negotiations. Economic freedom generates greater wealth and makes energy accessible, and that in turn, enables people to better insulate themselves from the vagaries of nature.

Mr. Mitra is director of the Liberty Institute, an independent think tank in New Delhi. Views are those of the author.

Courtesy: Liberty Institute, Financial Chronicle, 7 December 2009

The End of the IPCC: One Mistake Too Many!

S. Fred Singer

PCC has acknowledged they made a mistake in their projection of 2035 as the date when all Himalayan glaciers were said to melt. But the Himalayan blinder is not a one-off mistake; it is only the latest of the litany of errors that have dogged IPCC over the past ten years. And by now, after the “Climategate” flap of last November, “Glacier gate” seems to have opened the flood gates with reports on “Amazongate,” “Natural-disaster-gate,” and more.

In their 2001 report, IPCC had claimed that the 20th century was “unusual” and blamed it on human-released greenhouse gases. Their infamous temperature graph shown there, shaped like a hockey stick, did away with the well-established Medieval Warm Period (around 1000AD, when Vikings were able to settle in Southern Greenland and grow crops there) and the following Little Ice Age (around 1400 to 1800AD). Two Canadians exposed the bad data used by the IPCC and the statistical errors in their analysis.

And since then, the litany of errors continues to grow.

· In mid-August 2009, after repeated requests for such data under the Freedom of Information Act, the Climate Research Unit at the University of East Anglia (CRU), one of the three international centers that publish global temperatures, announced that it discarded the raw data used to calculate global surface temperatures. The CRU action renders independent review and verification of the temperature trends published by the CRU impossible – a clear violation of principles of science and the Freedom of Information Act.

· In October, at the 2009 annual meeting of the Geological Society of America, Dr. Don Easterbrook presented graphs demonstrating how tree-ring data from Russia showing a cooling after 1961 were truncated and artfully disguised in IPCC publications. The artful deceit, so exposed, indicates that the IPCC Assessment Report 4 (AR4) contains deceptions rendering its conclusions scientifically questionable.

· In November, emails from the CRU were leaked to the public, creating what became known as “Climategate.” These emails reveal efforts to suppress independent studies that are contrary to IPCC conclusions of human-caused global warming. Thus, the IPCC scientific review process has a systematic bias of an unknowable magnitude in favor of human-induced warming.

· In mid-December, the Russian Institute of Economic Analysis (IEA) reported that the Hadley Center for Climate Change of the British Meteorological Office (Met Office) had probably tampered with Russian climate data and that the Russian meteorological station data do not support human-caused global warming. [The Met Office collaborates with the CRU in reporting global temperatures.] The reported global surface temperature trends are unreliable and probably have a strong warming bias of an unknown magnitude.

· In January, Joe D’Aleo and E. Michael Smith reported that the US-National Climatic Data Center (NOAA-NCDC) and the National Aeronautics and Space Administration’s Goddard Institute of Space Studies (NASA-GISS) dropped many meteorological stations from their data bases in recent years. The dropped stations, many of which continue to make appropriate reports, are generally in colder climates. Thus, all global surface temperatures and temperature trends announced by the three international reporting organizations probably have a warming bias of an unknown magnitude -- rendering their announced temperatures and temperature trends scientifically unreliable.

· On January 23, 2010, the Sunday Times (London) reported that the AR4 wrongly linked natural disasters to global warming. The published report upon which this claim was based actually stated: “We find insufficient evidence to claim a statistical relationship between global temperature increase and catastrophic losses.”

· In January, 2010, Dr. Murari Lal, the coordinating lead author of the AR4’s chapter on Asia, stated that the IPCC deliberately exaggerated the possible melt of the Himalayan glaciers. “We thought that if we can highlight it, it will impact policy-makers and politicians and encourage them to take some concrete action.” This admission demonstrates that the AR4 is a political document and not a scientific one.

· This past week, additional reports reveal that IPCC’s claims that warming will cause extensive adverse effects in the Amazon rainforests and on coral reefs came not from science studies but from publications by environmental groups, such as the World Wildlife Fund and Greenpeace. More scandalous even, the IPCC based their lurid predictions on anecdotal, non-peer-reviewed sources – not at all in accord with its solemnly announced principles and scientific standards.

These events showed not only a general sloppiness of IPCC procedures but also an extreme ideological bias – quite inappropriate to a supposedly impartial scientific survey. By themselves, they do not invalidate the basic IPCC conclusion -- that a warming in the latter half of the 20th century was human-caused, presumably by the rise of greenhouse gases like carbon dioxide.

Yet all of these missteps pale in comparison to ClimateGate, which calls into question the very temperature data used by the IPCC’s main policy result. In my opinion, ClimateGate is a much more serious issue than simply sloppiness and ideological distortion; ClimateGate suggests a conspiracy to commit fraud by a small gang of influential IPCC scientists.

In this enterprise, the group was aided not only by environmental zealots, anti-technology Luddites, utopian one-worlders, and population-control fanatics, but also by bureaucrats, businesses, brokers and bankers, who had learned how to game the system and profit from government grants and subsidies for exotic schemes to produce 'carbon-free' energy and from the trading of carbon permits. Hundreds of billions have already been wasted -- most of this in transfers of tax revenues to a favored few.

These sums pale, however, in comparison to the trillions that would have been spent in future if some of the mitigation schemes had come to fruition. Fortunately for the world economy, these schemes all collapsed at the Copenhagen conference. Clearly, developing nations did not want to take on the sacrifices and restrictions on growth. There was little concern expressed about climate; Copenhagen was mostly about transfer of money from rich to poor countries – or more precisely, from the poor in rich countries to the rich in poor ones.

“Climategate” now makes it unlikely that such mitigation and transfer schemes will ever be carried out.

Dr S. Fred Singer, an atmospheric physicist, professor emeritus at the University of Virginia, and former director of the US Weather Satellite Service, is the organizer of NIPCC (Non-governmental International Panel on Climate Change) and coauthor of its reports “Nature, not human activity, rules the climate” [2008] and “Climate Change Reconsidered” [2009].

Courtesy: Hindustan Times, 5 February 2010

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 39

Debate: Are We Goofing Up?

Benny Peiser, Director, Global Warming Policy Foundation (GWPF)

t’s not just glaciers, the IPCC is generally alarmist — linking global warming to natural disasters is another such example

For the last 20 years, one IPCC report after another has been responsible for a relentless outpouring of doomsday predictions. The IPCC process, however, by which it arrived at its alarmist conclusions, has been shown on numerous occasions to lack balance, transparency and due diligence.

The IPCC’s work is controlled by a tightly-knit group of individuals who are totally convinced that they are right. As a result, conflicting data and evidence, even if published in peer-reviewed journals, are regularly ignored, while exaggerated claims, even if contentious or not peer-reviewed, are often highlighted in IPCC reports.

Not surprisingly, the IPCC has lost a lot of credibility in recent years. It is also losing the trust of more and more governments who are no longer following its advice — as the Copenhagen summit showed.

Claims by RK Pachauri, chair of the IPCC, that IPCC’s erroneous doomsday prediction about the fate of Himalayan glaciers was an isolated, and wholly uncharacteristic mistake, are completely baseless.

There is ample evidence to show that the IPCC review process is neither robust nor transparent. In 2007, when the IPCC published its latest report, the Panel claimed that global warming was to blame for an increase in the number and severity of natural disasters such as hurricanes and floods. Yet the paper on which the IPCC based its assertion had not been published at the time. When it was finally published in 2008, its conclusion contradicted the IPCC’s false alarm, stating: “We find insufficient evidence to claim a statistical relationship between global temperature increase and catastrophe losses.”

Not just in this case, but on other contentious issues, the IPCC has consistently promoted alarmist predictions. On issues such as the possible affect of global warming on malaria, human health or national economies, IPCC authors habitually prefer to cite alarmist papers while research findings that come to less gloomy conclusions are often disregarded.

In the latest instance, the GWPF has just released details of the defective process by which the 2035 Himalayas date got into an IPCC report. As a result of a Freedom of Information request, David Holland, a GWPF researcher, gained access to the responses by IPCC’s lead authors. The documents show that most doubts and questions that were raised about the 2035 date were ignored and that the review editors failed to take any note of it.

But even where the IPCC relies on peer-reviewed papers, it does not guarantee that its claims and conclusions are reliable or trustworthy. As the notorious “hockey stick” controversy about temperature reconstructions has shown, IPCC contributors have consistently failed to disclose their data and methods while the IPCC has consented to such misconduct.

The Panel’s inner circle has been characterised for many years by an endemic bias towards alarmist assessments and calls for radical action. There are growing concerns among many governments about the way the IPCC works and how it produces its conclusions. Its demand for drastic economic changes is posing a serious political predicament for many governments, not least in India. After all, most countries find themselves unable to control, let alone reduce, CO₂ emissions, as realistic alternatives to cheap fossil fuels are non-existent. It is this concern about the potentially-destabilising consequences of the IPCC’s radicalism based on unbalanced and unreliable professional advise that has led to calls for a reform of the IPCC.

The IPCC’s agenda and its catastrophic framing of climate change is mainly driven by western government departments staffed by green ministers, civil servants and researchers, many of whom have strong personal backgrounds in environmental campaigning and ecological ideologies.

Any significant IPCC reforms will ultimately depend on the economic and political cost of its workings and how it threatens the stability of national economies. The Indian government has more or less conceded that the radical actions promoted by Pachauri and the IPCC are threatening to undermine realistic government policies. The price of climate hysteria has eclipsed the value of political and economic stability. The time has come to completely overhaul the structure and workings of the IPCC. Unless it accepts to undergo a root and branch reform, it will continue to haemorrhage credibility.

Courtesy: The Global Warming Policy Foundation (GWPF), London, UK, Business Standard, 27 January 2010

Will Meeting Electricity Shortages Lead to Economic Development? (part IV)

Bharat Jhunjhunwala

Continued from Volume VI, Issue No. 37…

Answer to shortages

his short paper had started from the question how to supply electricity to our villages that are facing power cuts of up to 16 hours or more; and to provide cheap electricity to face competition from other countries. The answer to this is at two levels.

1 Level 1: The ideal solution is to produce electricity equal to Q₁ and provide to consumer at price P₁. The demand will become less and long-term economic development will also be secured.

2 Level 2: The second-level solution is to produce electricity equal to Q₁ so that long term economic development is secured. Then administratively allocate the power between competing users as best as possible. This will lead to sub-optimal economic growth but still ensure long term economic sustainability.

The underlying idea is that long term economic growth and sustainability stands at a higher pedestal than short-term economic growth. If we are not willing to price electricity at its correct social price then inefficiency is inevitable. The choice then is between (1) producing more electricity, ignoring social costs and risking the existence of our civilization; and (2) accepting lower short term growth rates due to administrative inefficiencies in allocation of power. This means that we should live with shortages to ensure survival of our civilization.

Counterargument 1: Impact on the poor

Counterargument is that the policy of pricing power at price P1 will impose huge burden on the poor who do not have the capacity to pay.

The solution is to enhance the capacity of the poor to pay higher price of power by putting in place economic policies that generate employment and that increase price of agricultural produce suitably.

The impediment in implementing this scheme is the middle class which will have to pay higher price of electricity, higher wages to the maid and higher prices of food.

Counterargument 2: Global competitiveness

Counterargument is that Indian industries will have to pay true price of electricity at P₁ while our global competitors will be paying lower price at P₃. This will price our goods out of the global market.

The solution is to impose higher import taxes and to provide export subsidy. This will maintain high price of electricity and other goods within the domestic market while enabling our producers to compete globally. Our long term economic growth will be secured while the short term economic growth will be somewhat reduced because we will loose access to cheap foreign goods made from low-priced electricity. We must focus on long term economic growth first and short-term economic growth later.

Concluded

Views are those of the author

Author can be contacted at [email protected]

NEWS BRIEF

NATIONAL

OIL & GAS

Upstream

Dhirubhai Deepwater KG2 spins bit offshore India

March 8, 2010. Transocean's newbuild ultra-deepwater drillship Dhirubhai Deepwater KG2, which is owned by a joint venture with Pacific Drilling Limited, has commenced operations for Reliance Industries in India under a five-year drilling contract.

The dynamically positioned Dhirubhai Deepwater KG2, one of 24 Ultra-Deepwater Floaters in the Transocean fleet, includes the most advanced drilling capabilities in the offshore drilling industry.

The vessel features National Oilwell Varco drilling packages, significant off-line tubular-handling and stand-building capabilities, advanced mud system designs, systems for building, storing and running several subsea trees and efficient riser and BOP (blowout preventer) handling systems.

The drillship has a variable deckload of approximately 20,000 metric tons and is equipped to work in water depths of up to 12,000 feet and outfitted to construct wells up to 35,000 feet deep.

ONGC may borrow $10 bn to buy assets

March 8, 2010. Oil & Natural Gas Corp., India’s biggest energy explorer, may borrow $10 billion over the next decade as it competes with rivals from China and South Korea to buy oil assets overseas to meet domestic fuel demand.

The state-owned company completed India’s biggest overseas energy acquisition last year and had cash and short-term investments of 127 billion rupees ($2.7 billion) as of March 31. Its debt-to-equity ratio was 0.01. ONGC would like a ratio of 2, amounting to more than $10 billion of debt over 10 years as its net worth grows.

ONGC, which is leading India’s search for resources, bought Imperial Energy Plc for 1.4 billion pounds ($2.1 billion) and was part of a group that won a bid last month for a project in Venezuela. Chinese energy companies have announced plans to spend at least $18 billion since 2006 on oil and gas fields in Africa as the world’s fastest-growing major economies seek to build energy security.

Reliance leases 1.2 mn bbl storage in Bahamas

March 5, 2010. Reliance Industries has leased about 1.2 mn barrels of clean storage at the Borco Terminal in Bahamas as it seeks to increase its presence in the United States.

Reliance, which operates the world's biggest refining complex, aims to directly sell fuel in the U.S., the world's biggest oil consumer, and had earlier leased 800,000 barrels of clean storage from American refiner Hess Corp in the New York harbour.

The firm leased about 1.2 million barrels storage with Borco, while a third source put the figure at 1 million barrels. They said the Borco deal was done in the second half of 2009.

Reliance last year began shipments to the U.S., after it started its 580,000 barrels per day refinery, located next to its old 660,000 bpd refinery at Jamnagar in Western India.

Downstream

IOC losing Rs 1.07 bn a day on selling fuel below cost

March 3, 2010. Country's biggest fuel retailer Indian Oil Corp said it is losing Rs 1.07 bn a day on selling auto and cooking fuel below cost even as it awaits the government to announce clear compensation package.

IOC and sister concerns Hindustan Petroleum and Bharat Petroleum currently sell petrol at a loss of Rs 4.97 a litre, diesel at Rs 3.27 per litre, kerosene at Rs 16.91 a litre and domestic LPG at a loss of Rs 267.39 per 14.2-kg cylinder.

These losses are after the Rs 2.71 a litre hike in petrol and Rs 2.55 per litre increase in diesel rates that were primarily because of Finance Minister Pranab Mukherjee raising customs and excise duty on the two fuel.

While the losses on petrol and diesel are met by upstream firms like ONGC, the government has not kept its promise to make up all of the Rs Rs 315.74 bn in revenues lost on selling LPG and kerosene below cost. Of this, Finance Minister provided an additional Rs 118.45 bn, still leaving a huge deficit of Rs 197.29 bn.

Transportation / Trade

Price hike does little to cut oil PSUs' under-recoveries

March 3, 2010. The three public sector oil marketing companies – Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation – continue to incur under-recovery of Rs 4.97 a litre and Rs 3.27 a litre on petrol and diesel, respectively. Hence, the recent price hike of Rs 2.71 a litre on petrol and Rs 2.55 a litre on diesel has done little to help the OMCs, as this being the tax component, the amount goes to the Government. The companies incur under-recoveries on auto and cooking fuels as they sell these products at a Government controlled price.

The recent hike was just to offset the increase in customs and excise duties announced in the Budget. Indirect taxes are always passed on to the consumers. The build up to the retail pricing comprises refinery transfer price (which includes customs duty), marketing margins, transportation charges, excise duties plus local levies and taxes.

The refinery transfer price is the price at which marketing companies lift product from the refiners. If the increase in retail price had not happened, the refineries that anyway have to absorb the crude oil import duty would have had to absorb the tax increase in products also. This would have resulted in further impacting their financial health.

For the current fiscal, the OMCs are estimated to lose Rs 474 bn on the sale of petrol, diesel, domestic LPG, and PDS kerosene, below the market price. Indian Oil Corporation alone is estimated to lose around Rs 263 bn for the fiscal.

Policy / Performance

Indian Oil to look abroad, diversify, to cut losses

March 8, 2010. State-run Indian Oil Corp., India's largest listed company by sales, plans to buy oil and gas assets overseas, expand its petrochemical business and build a liquefied natural gas terminal, to help it reduce exposure to selling discounted fuel to domestic consumers.

Indian Oil, an oil marketing and refining company, is joining other major state-run Indian energy companies, including flagship oil group Oil & Natural Gas Corp. and Coal India, which produces more than 80% of India's total coal, in unveiling ambitious overseas expansion plans.

Indian Oil, which gets more than 90% of its revenue from petroleum product sales, is losing 1.06 billion rupees ($23.3 million) daily selling cooking and auto fuels at state-set prices.

It and other state-run companies are partially compensated through discounts on crude sold by upstream firms and partly through subsidies, but they have to carry part of the cost.

PSU oil cos to invest over Rs 775 bn on expansion

March 4, 2010. State-owned oil firms will invest over Rs 775 bn in adding 44.2 million tonnes of refining capacity by 2012. Indian Oil Corp is investing Rs 297.77 bn in building a new refinery at Paradip in Orissa with an annual production capacity of 15 million tonnes. Bharat Petroleum Corp's joint venture is investing Rs 113.97 bn in a 6 million tonnes unit at Bina in Madhya Pradesh, while Hindustan Petroleum Corp is spending Rs 189.19 bn in building a 9 million tonnes refinery at Bhatinda in Punjab.

Besides, Mangalore Refinery is investing Rs 124.12 bn in expanding its 11.82 million tonnes refinery to 15 million tonnes. These and other capacity additions would raise India's oil refining capacity to 153.832 million tonnes by the end of XIth Five Year Plan (2007-12) from 109.586 million tonnes currently. Other capacity addition projects include Rs 28.69 bn expansion of IOC's Haldia refinery by 1.5 million tonnes to 7.5 million tonnes and Panipat unit expansion to 15 million tonnes (from 12 million tonnes) at Rs 10.08 bn.

POWER

Generation

Adani Power in race for 1 GW Kosovo project

March 8, 2010. After spreading its operations beyond Gujarat, to Maharashtra, Rajasthan and Madhya Pradesh, Adani Group company Adani Power is now looking for opportunities outside India.

The power company is in race for a 1,000-mw power generation project in Kosovo, part of the EU. It is competing with AES of the United States, Turkey’s Demir Export AS & Park Holding and a consortium including Public Power Corp, Greece and ContourGlobal US. Kosovo, with a population of 20 lakh and sizeable lignite reserves, is suffering from acute power shortage and wants to attract private players in the energy sector.

The successful bidder will pump in about Rs 50 bn and get access to the local lignite mine for fuel linkage. The Kosovo government is expected to take the final call by September and expects to start building the plant early next year. It may also hold equity in the power project.

Power: Pvt cos' rising clout to foster capacity

March 6, 2010. Private sector companies have stepped up the building of new power plants. This would have a two-fold impact on the sector’s dynamics in the near term. First, there would be more opportunities for retail investors, as many of these companies would be tapping the capital markets. For consumers it would mean more competition in the long run driving down prices.

Although, state-owned firms such as NTPC and NHPC have been for long the main suppliers of electricity in the country, a large part of the new generation capacity is now being built by the private sector.

Private firms have added over half of the total commissioned capacity in the first three quarters of fiscal ending 31 March ‘10. In contrast, they had accounted for less than 10% of new capacity added in FY08. In FY09, the proportion had increased to 25%, according to data available with Central Electricity Authority (CEA).

Transmission / Distribution / Trade

Essar to pay $600 mn for US co Trinity Coal

March 6, 2010. Essar Group's subsidiary Essar Minerals, Delaware, will buy US-based Trinity Coal Partners for $600 million (about Rs 27.60 bn). Trinity is among the top 10 US coal producers with operations in the central Appalachian region.

Essar has signed a definitive agreement with Denham Capital, an energy and commodities-focused private equity firm, by which Denham will sell its 100 per cent ownership of Trinity to Essar. The deal is expected to close by the end of this month.

Trinity owns and operates mines in Kentucky and West Virginia and has a proven resource base of about 200 million tonnes (mt) of coal, split equally between metallurgical and steam coal. It produces about seven million tonnes annually and plans to ramp this up to 10 million tonnes. Trinity sells both steam and metallurgical coal to electric utilities, steel manufacturers, coal brokers and other buyers primarily in the eastern United States.

NTPC keen to exit PTC India

March 5, 2010. State-owned NTPC is believed to have approached the Power Ministry on selling off its 16.5 per cent stake in PTC India as the company plans to focus on its own power trading business.

PTC India is a government initiated Public-Private Partnership, primarily focused on developing a commercially vibrant power market in the country. NTPC, NHPC, Power Finance Corporation and Power Grid Corp currently hold 16.5 per cent stake each in PTC India. NTPC would like to offtake its stake in PTC India as they (PTC) are already off the ground.

The power generator would want to concentrate on its own trading company NTPC Vidyut Vyapar Nigam, sources said. It (NTPC) is in discussions with the Power Ministry regarding the same, they said, adding that NTPC is of the view that PTC India is already on its feet and does not require its support.

The main objective of NTPC Vidyut Vyapar Nigam will be to purchase electricity generated both from both conventional and non-conventional sources.

Slump, input prices may play spoilsport for ABB India

March 3, 2010. ABB India continues to feel the heat of the slowdown in corporate investment, pricing pressure on its products division and its decision to exit the rural electrification business, which in retrospect was ill-timed.

The company posted a sales decline of 13% for the quarter ending December 2009 and profits declined as much as 43%. The performance is, in fact, worse than that for the previous three quarters of this year (ABB follows January-December financial year), when sales and profits declined by 7% and 30%, on an average.

Policy / Performance

CEA moots changes to transmission charge proposal

March 8, 2010. The Central Electricity Authority (CEA), the apex planning body in the power sector, has suggested changes to the Central Electricity Regulatory Commission's (CERC) new proposal on inter-State transmission charges.

The CEA, commenting on the Commission's Draft Regulation on Sharing of Inter State Transmission Charges and Losses, has suggested that transmission charges for generators must be specified individually and plant-wise, instead of grouping generators into geographical zones. It has also said that the principle of taking one State as a separate demand zone should be adopted all over India, including the north-eastern region.

The CERC's proposal mainly aims at avoiding “pancaking of transmission charges”. The draft proposes to replace the current ‘Regional Postage Stamp' method by a new ‘Point of Connection (PoC)' model.

Under the Regional Postage Stamp method, States in a region share the charges and losses of transmission on a pooled basis in the ratio of quantum of power drawn through the inter-State transmission system.

Over Rs 40 bn approved for grid-connected solar plants

March 8, 2010. Government said Rs 44.37 bn have been approved for setting up 1,100 MW grid-connected solar power plants under the first phase of the National Solar Mission. "(There is) a target to set up 1,100 MW grid-connected solar plants, including 100 MW capacity plants as rooftop (plants) and other smaller solar power plants for the first phase of the mission till March 2013," New and Renewable Energy Minister Farooq Abdullah said in reply to a question in Rajya Sabha.

Under the three-phase National Solar Mission, the government is planning to generate 20,000 MW solar power by 2022. During this period, 2000 MW capacity equivalent off-grid solar applications, including 20 million solar lights, are also planned to be installed. "In addition, 200 MW capacity equivalent off-grid solar applications and 7 million square metre solar thermal collector area are to be installed," he added.

Replying to another query, the Minister said around 15,789 MW grid-interactive power generation capacities have been installed through various renewable energy sources in the country, of which 10,949 MW has been produced from wind energy.

Coal India sets up satellite surveillance system

March 7, 2010. In an effort to accord high priority to environment-friendly mining practices, Coal India Ltd (CIL) has introduced satellite surveillance of its open cast mines. The satellite imageries and the related surveillance data – to be updated regularly – are available on the Web for public scrutiny.

The company has also made “environmental mitigation records” the second most important parameter, after production targets, in the annual performance report of its managers. On the satellite surveillance, he said 35 large open cast projects operated by the company had been brought under scrutiny in 2009-10.

SEBI okays Coal India's IPO

March 6, 2010. The Securities and Exchange Board of India (SEBI) approved Coal India Ltd's (CIL) proposal to offer one per cent share to its own employees as well as those employed in its subsidiary companies through an initial public offer.

The regulator previously held that shares could be offered only to the employees of CIL. However, considering that nearly 99 per cent of the four-lakh workers are under the mining subsidiaries wholly-owned by CIL, such restrictions would have cast a shadow over the coal major's plan to convert its workers into stake-holders in the organisation.

Fuel linkages to 11 thermal projects

March 5, 2010. The Coal Minister, Mr Sriprakash Jaiswal approved a grant of fuel linkages to 11 new thermal power projects of NTPC and Damodar Valley Corporation.

The projects located in Uttar Pradesh, Bihar, West Bengal and Maharashtra would add up to the capacity of 7260 MW and also supply power to the National Grid for achieving the Twelfth Plan target.

The 11 units include nine units of NTPC's power plants at Nabinagar in Bihar (3 units of 660 MW each), Meja in Uttar Pradesh (two units of 660 MW each), Solapur (2 units of 660 MW each) and Mouda (two units of 660 MW) in Maharashtra and two units of Damodar Valley Corporation's Raghunathpur plant in West Bengal.

SEZ developers can supply power without licence from States

March 5, 2010. The Government has permitted developers of Special Economic Zones (SEZ) to supply electricity in these zones without a distribution licence from the State Governments.

In a notification dated March 3, the Government said a proviso shall be inserted in the Electricity Act, 2003 to the effect that a developer of a notified SEZ shall be deemed to be a licensee for supplying electricity in the zone.

This would help the developers in saving time and effort in getting such a licence from the State Governments. But sale of excess power by SEZ developers would attract 16 per cent customs duty, according to the Budget. Power plants in SEZs are eligible for duty-free imports of capital goods and raw materials used for power generation.

No power cuts for 2 yrs, Delhi govt assures SC

March 4, 2010. The Delhi government promises there will be no loadshedding even in peak summer months for the next two years, starting this month.

In an affidavit before the Supreme Court, the Delhi government has said it has made sufficient arrangements to meet the high power demand that has left the capital sweltering in the past.

If it keeps its word, the rotational loadshedding during hot summer nights and hardships for students appearing in examinations may actually be a nightmare of the past.

INTERNATIONAL

OIL & GAS

Upstream

Double success for Dana Gas in Egypt

March 8, 2010. Dana Gas PJSC, the Middle East's first and largest regional private sector natural gas company, has announced two gas discoveries in the Nile Delta, Egypt. The first discovery was at El Panseiya-1 in the West El Manzala Concession, which encountered 11 meters of net pay in the Kafr El Sheikh formation and produced 10 million standard cubic feet per day (mmscfpd) of dry gas. The preliminary estimate of the recoverable reserves is from 8-13 billion cubic feet (bcf) of gas.

RussNeft to increase oil production at Tomsk block

March 5, 2010. RussNeft plans to produce 333 thousand tons of oil at the Tomsk block in 2010, exceeding the analogous determinant of 2009 (197.9 thousand tons) by 40%. The growth of hydrocarbons production will be reached through implementation of large-scale drilling programs at the oil fields of Russneft in Eastern Siberia. Stolbovoye oil field plans to raise oil production output four times as compared to last year. This year 11 new wells will be drilled here.

RussNeft is going to bring the Stolbovoye oil field, where recoverable resources amount to 12.2 million tons, to the maximal level of commercial production in the shortest possible time. In three years, Russneft will try to bring annual production output at Stolbovoye oil field to 1 million tons.

Nigeria's oil production tops 2.5 million barrels per day

March 5, 2010. Nigeria's crude production has risen to 2.5 million barrels per day following the amnesty program to militants operating in oil rich Niger Delta region.

The Nigerian National Petroleum Corporation (NNPC) was producing about 1.7 mmbpd in the heat of repeated militant attacks on the nation's oil and gas facilities in the Niger Delta region before President Yar's Adua struck the amnesty deal.

In June 2009, the Nigerian government offered an amnesty to gunmen in the oil rich Niger Delta region, urging them to lay down their weapons by Oct. 4 in a bid to end the unrest which has cost Africa's top oil exporter billions of dollars in lost revenue.

Brazil's OGX spots oil shows at shallow water prospect

March 5, 2010. OGX has identified an oil-bearing interval in the Albian section of well 1-OGX-6-RJS, located in the BM-C-41 block, in the shallow waters of the southern part of the Campos Basin. OGX holds a 100% working interest in this block. So far an oil column of about 70 meters with approximately 38 meters of net pay was encountered in carbonate reservoirs in the Albian section.

Thermobaric effects associated with volcanism in the area contributed to optimize the permo-porosity properties of the reservoirs. The drilling in the Albian section is still in progress and the well OGX-6 will be drilled up to a final depth of approximately 3,600 meters.

Russian oil output to reach 495 million tons in 2010

March 5, 2010. Oil output in Russia is projected to reach 495-496 million tons this year. Last year's oil production stood at 494 million tons, and oil output grew by 2.8 percent year-on-year, or 1.2 million tons, in January.

The Russian Energy Ministry predicted that 495 million tons of crude would be exploited this year, with 247 million tons exported and 238 million tons processed. The Russian economy, heavily dependent on energy resources, was hit hard by the global downturn after commodity prices collapsed in late 2008. The country is emerging from the crisis as crude prices continue to rise.

Saudi Arabia raises most April oil prices to U.S.

March 3, 2010. Saudi Aramco, the world’s largest state-owned oil company, raised official selling prices for all crude grades, except heavy, for customers in the U.S. for April and lowered prices on all grades to Europe and most for Asia.

The company increased the formula price of its Arab Light crude to the U.S. the most, raising it by 15 cents a barrel, or 20 percent, to a 60-cent discount off the benchmark Argus Sour Crude Index, Aramco said today in an e-mailed statement. It boosted the premium for Extra Light crude to 95 cents above the benchmark, also a 15-cent change. The formula price of Arab Medium crude to the U.S. rose 10 cents to $2.10 a barrel below the Argus index, while the Arab Heavy crude price fell 15 cents to a $3.30-a-barrel discount.

Pemex to pump 60,000 barrels of oil at Chicontepec

March 3, 2010. Petroleos Mexicanos, the state-owned oil company, said it aims to almost double crude production to 60,000 barrels of oil a day at the onshore Chicontepec field by year-end as it seeks to boost output.

The Mexico City-based company may drill 505 wells at Chicontepec this year, down from 794 wells in 2009. Pemex, the largest oil producer in Latin America, plans to spend 20.7 billion pesos ($1.6 billion) in 2010 to develop Chicontepec, which stretches across Puebla and Veracruz states in central and eastern Mexico, according to a company presentation posted on its Web site. Last year the company invested about 27.1 billion pesos on the project that is under review after falling short of production targets.

Downstream

Our plan superior to RIL bid: Lyondell

March 9, 2010. LyondellBasell Industries said it rejected a purchase offer by Reliance Industries because its own reorganisation plan is superior. Lyondell’s new outline of its Chapter 11 reorganisation, filed in US Bankruptcy Court in New York, incorporates a settlement agreement with some of the company’s lenders and sets April 30 as the date for the chemical company to exit bankruptcy.

The new plan includes a settlement between unsecured creditors and secured lenders partly resolving litigation. Senior secured creditors, who own the majority of the debt, support the plan over any alternative proposal, Harpole said.

BP hit with $3 mn safety fine for Ohio refinery

March 8, 2010. BP Plc was accused of more problems in its U.S. operations when the U.S. Occupational Safety and Health Administration announced dozens of safety violations found at the BP-Husky refinery in Toledo, Ohio, that could cost the energy giant more than $3 million in fines. OSHA's announcement comes five months after the agency slapped BP with a record $87.4 million fine for failing to fix safety problems at its giant Texas City, Texas, refinery found after a deadly March 2005 explosion that killed 15 workers and injured 180 other people.

BP has 15 days to appeal the violations to the Occupational Safety and Health Review Commission, which is already weighing the appeal of the latest fine against the Texas City refinery.

SK Engineering wins study for $12.5 bn Ecuador refinery

March 8, 2010. SK Engineering & Construction Co., a South Korean builder, said it has won a US$260 million order for an oil refinery project in Ecuador.

Under the deal with Ecuador's state-run oil company, Petroecuador, SK will conduct a basic engineering study to build the oil refinery in Ecuador's coastal province of Manabi, the Korean builder said in a regulatory filing.

Petroecuador plans to build the oil refinery with a daily production capacity of 300,000 barrels for $12.5 billion, according to the Korean company.

Sinopec plans to increase crude runs by 11.4 pc - Exec

March 5, 2010. China Petroleum & Chemical Corp. (SNP), known as Sinopec Corp., plans to process 205 million metric tons of crude oil at its refineries this year.

The planned throughput is 11.4% higher than 184 million tons of crude run through the company's plants in 2009, Su said on the sidelines of China's National People's Congress.

Sinopec--Asia's largest listed refiner by capacity--brought several new refining units on stream last year. These include an expanded 240,000-barrel-a-day refinery in southern Fujian province with partners Saudi Arabian Oil Co., ExxonMobil Corp. and the Fujian provincial government.

Sinopec to raise 2010 fuel retail sales by 6 pc

March 3, 2010. Sinopec Corp plans to raise retail sales of refined oil products this year by 6 percent, recovering most of the declines in 2009.

Retail sales of refined fuel by the top refiner in Asia declined 6.18 percent to 78.9 million tonnes last year from 2008, preliminary company data has shown.

Sinopec's total sales of refined fuel inched up 0.85 percent to 124.02 million tonnes in 2009. Sinopec aims to increase turnover of non-fuel businesses by 50 percent from levels in 2009.

Transportation / Trade

Canadian Pipeline Group backs govt changes to approvals process

March 9, 2010. The Canadian Energy Pipeline Association (CEPA) announced that it applauds the federal government's decision to eliminate red tape in pipeline projects which are federally regulated, and replace them with simpler processes that offer improved environmental protection. The 2010 from the Throne indicated that the government plans to "untangle the daunting maze of regulations that needlessly complicates project approvals"; to continue to invest in clean energy technologies; and to reform the northern regulatory regime to help expedite key pipeline projects.

Toyota proposes oil pipeline bypassing port Sudan

March 5, 2010. Toyota Tshusho Corp. has proposed to Kenyan officials to construct a 1,400-kilometer (870-mile) pipeline to transport crude oil from the landlocked South Sudan capital city to Lamu, a port on the Indian Ocean.

If constructed, the pipeline would provide an alternative to the country's only current oil exporting point, Port Sudan, potentially having major economic and political implications on the whole of Sudan.

Canada regulator OKs TransCanada shale gas plan

March 4, 2010. Regulators conditionally approved TransCanada Corp's plan for a C$200 million ($194 million) pipeline, the first federally regulated shale gas transport system in Western Canada. The 77 km (48 mile) Groundbirch pipeline would carry gas to TransCanada's Alberta pipeline network from northeastern British Columbia's Montney formation.

Canada's National Energy Board said said its approval carried 30 conditions, comprising such things as environmental protection and aboriginal consultation measures. The region of British Columbia has become known as one of the continent's top sources of natural gas trapped in shale rock formations. The industry has improved drilling and recovery technology to the point where trillions of cubic feet of supply have become accessible.

Enbridge says oil pipelines may run at reduced rates until 2017

March 3, 2010. Enbridge Energy Partners LP, the Houston-based pipeline partnership controlled by Canada’s largest pipeline company, said it may take seven years to fill new crude oil pipelines from Canada to the U.S. because of excess capacity.

The Clipper operates under a so-called common carrier agreement, where shippers nominate deliveries to the pipeline and tolls increase if volumes decrease.

Enbridge will collect about $180 million a year from its shippers regardless of the volume shipped. If the pipeline runs at reduced rates shippers will pay a higher price per barrel. The Clipper, which runs 1,000 miles (1,607 kilometers) from Hardisty, Alberta, to Superior, Wisconsin, can be increased in capacity to 800,000 barrels a day.

Policy / Performance

Shell, PetroChina make $3 bn Arrow Energy offer

March 8, 2010. Royal Dutch Shell Plc and PetroChina Co. made an offer worth more than A$3.3 billion ($3 billion) to acquire Arrow Energy Ltd., the holder of Australia’s biggest coal-seam gas acreage.

The cash component of the offer values the company at A$3.3 billion based on the company’s 733 million shares outstanding. Arrow has acquired 100 percent of the A$2.2 billion Fisherman’s Landing project in Queensland, one of more than a dozen proposed liquefied natural gas ventures in Australia aiming to tap rising Asian demand for fuel that burns cleaner than coal and oil.

Turkish Parliament approves Caspian-Europe gas pipeline

March 5, 2010. The Turkish Parliament approved a bill on a deal signed by Austria, Bulgaria, Hungary, Romania and Turkey to launch the Nabucco pipeline project, which will link Europe to the Caspian Sea region.

The project is considered a key to reduce Europe's energy dependence on Russia. Under the law approved by the parliament, Nabucco pipeline will carry Caspian natural gas to Austria through Turkey, Bulgaria, Romania and Hungary.

Statoil, Norwegian govt reach Kaarstoe settlement

March 5, 2010. On 15 January Stavanger district court passed a judgment in the Kaarstoe gas processing plant case between the State, represented by the Ministry of Petroleum and Energy, and Statoil ASA.

The State was awarded a NOK 378 million post-tax judgment, plus a penalty interest from 24 January 2002. Under the settlement the amount is increased to NOK 500 million after tax, and the total pre-tax amount of interest is fixed at NOK 375 million, corresponding to NOK 270 million after tax. The interest represents an effective interest rate which is slightly lower than the penalty interest.

UNICA requests govt to remove import duty on ethanol

March 5, 2010. Ethanol prices paid to producers in Brazil’s top ethanol producing state Sao Paulo dropped by an average 16.7% even as the government here reportedly considers a plan to limiting a comparitively high price of Rs 27/litre for petrol doping-ready ethanol to only six months. Interestingly, though, the lower prices for ethanol to producers in Sao Paulo has not been passed on to consumers at petrol pumps, threatening to make ethanol less competitively priced compared to petrol, according to data compiled by the Brazilian Sugarcane Industry Associaition (UNICA). Prices at pumps in the same period fell by only 1%, UNICA reported..It is the largest organization in Brazil representing sugar, ethanol and bioelectricity producers created in 1997, following government deregulation of the sugar and ethanol sectors.

POWER

Generation

China Shanxi coal 2010 output to grow up to 30 pc

March 8, 2010. China's Shanxi Province, traditionally the country's top coal producer, expects its coal output to rise by up to 30 percent in 2010. The figure is higher than an earlier estimate of 600 million to 700 million tonnes.

Shanxi produced 615 million tonnes of coal in 2009, about 20 percent of China's total. This year China is targeting national coal output of 3.15 billion tonnes, a 3.3 percent increase, the country's economic planning ministry, the National Development and Reform Commmission, said in its annual economic plan on Friday.

That growth rate is slower than most analysts' demand forecasts and the NDRC's expectation that electricity output, most of which is coal-powered, will rise 6.6 percent this year. Shanxi launched a consolidation push in the coal industry last year during the economic slowdown, causing its annual coal output to fall about 5 percent.

GE Hitachi will help build Polish nuclear power plant

March 5, 2010. GE Hitachi Nuclear Energy and a major Polish power company have agreed to collaborate on an initiative to build that country’s first commercial nuclear power plants, the Wilmington-based company said.

The result could be a major financial gain for GE Hitachi. The memo of understanding between with Polska Grupa Energetyczna is one of the first steps toward building two nuclear plants, GE Hitachi said.

GE Hitachi will help the Polish company study the feasibility of building up to four reactors based on one of its reactor designs – the advanced boiling water reactor and another in the regulatory approval process, the economic simplified boiling water reactor. The initiative stems from Poland’s desire to meet targets agreed to by European Union countries to cut 1990 levels of greenhouse gas emissions by at least 20 percent by 2010.

Japan's second MOX nuclear reactor starts operations

March 3, 2010. Shikoku Electric Power Co said it has started operations at a mixed-oxide (MOX) nuclear reactor, the second reactor in Japan to begin output using the recycled fuel.

The 890-megawatt No.3 reactor at its Ikata plant was restarted on March 1 and started power output. The move is part of Japan's goal to move towards a closed cycle where it recycles its own spent fuel and then burns recovered uranium and plutonium as MOX fuel.

If it goes as planned, the reactor will enter commercial operations on March 30. Kyushu Electric Power Co started operations of the nation's first MOX-equipped reactor, the Genkai No.3 unit, in November.

In June 2009, Japan's power industry utilities' association delayed a target of having 16-18 nuclear reactors using mixed-oxide (MOX) fuel by five years to March 2016, denting the resource-poor nation's goal of a "closed" nuclear fuel cycle.

Transmission / Distribution / Trade

Australian Electricity prices to go up by July 2010

March 9, 2010. Prices for electricity in Western Australia are set to soar in the coming months, with Western Australian Premier Colin Barnett announcing significant increases in the State’s electricity retail tariffs.

Householders can expect a 7.5 percent increase in electricity prices from April 1st 2010, followed by a further 10 percent increase on July 1 this year, which is significantly lower than Budget assumptions for 2010 of 25.9 percent.

The average weekly cost increase for consumers would be $4.13 from July 1, but those facing financial hardship would pay an average of $2.78 more a week. Similar tariff rises would apply to small businesses, with an average weekly increase of $7.29 from July 1. This followed a recommendation to increase the amount by 22.1 per cent in 2010.

Europe supergrid hopefuls form club to push project

March 8, 2010. Ten companies pushing to build a pan-European offshore power network that could help cut carbon emissions and cost customers over 20 billion euros got together in London. The "Friends of the Supergrid" brings together companies that want to build the High Voltage Direct Current (HVDC) infrastructure together with those that hope to develop, install, own and operate it.

Building interconnectors to link offshore wind farms across the North Sea from Sweden and Denmark to Britain could cost 15-20 billion euros, according to a report commissioned by Greenpeace, in addition to the tens of billions needed to build the wind farms themselves over the next decade.

Around 57 billion euros ($83 billion) of cumulative investments in wind energy is expected by 2020 to build 40 gigawatts of generating capacity, according to the European Wind Energy Association.

Policy / Performance

Iran's Bushehr plant to be started this year: Russian FM

March 9, 2010. Russian Foreign Minister Sergei Lavrov confirmed that Iran's long-delayed Bushehr nuclear power plant would start up this year. Lavrov did not specify when the plant would be started, saying that Russia's state nuclear giant Rosatom was in charge of the timetable.

Iran's 1,000-megawatt nuclear power plant was originally constructed in the mid-1970s by Siemens of Germany but was abandoned with the outbreak of the country's 1979 Islamic Revolution.

Iran and Russia, after reaching an agreement on nuclear cooperation in 1992, signed a contract in January 1995 to finish the construction of the plant. The start of Bushehr has been postponed frequently in recent years.

US Coal gasification power plant receives final air permit

March 8, 2010. The proposed Cash Creek Generation coal gasification and power plant has received its final air quality permit, the last key environmental permit the project requires. That and other environmental permits had been opposed by environmental organizations including Valley Watch and the Sierra Club.

While those permits are now in hand, McInnis said Cash Creek Generation LLC has other work remaining, including securing a connection to the electrical transmission network; finalizing certain contracts and other business issues; and receiving certain approvals from the Kentucky Public Service Commission and the Kentucky State Board on Electric Generation and Transmission Siting.

Sarkozy seeks funding, training for nuclear energy

March 8, 2010. International development banks must finance civilian nuclear projects to help emerging nations build energy plants, French President Nicolas Sarkozy said on Monday, laying out ambitious plans to develop the industry.

France is one of the world's largest users of nuclear energy, generating 80 percent of its power consumption from a network of 58 nuclear reactors, and is actively seeking to sell its nuclear technology to countries around the world.

Nuclear power producer EDF and reactor maker Areva were among a French consortium which bid for and lost a $40 billion nuclear project in Abu Dhabi in December. They remain very active on the export front, trying to sell their decades-long nuclear expertise to countries such as the United States, Britain, Italy, China or India.

Sarkozy said the World Bank, the European Bank for Reconstruction and Development and other such institutions should make a "wholehearted commitment" to fund civilian nuclear energy programmes.

Nuclear Plants lose bid to extend security deadline

March 8, 2010. The U.S. Nuclear Regulatory Commission denied a petition by the Nuclear Energy Institute to extend by nine months a deadline for new security requirements. Owners of nuclear reactors must meet the tighter security rules by March 31 as planned, or seek a waiver, the commission said. The Nuclear Energy Institute is an industry lobbying group in Washington that represents about 350 members, including reactor builder Areva SA and power company Exelon Corp. The new rules include installing physical barriers and detection systems, as well as requirements for testing and training, the commission said.

Peabody to invest in Calera

March 7, 2010. Coal mining company Peabody Energy Corp plans to say it is investing in energy start-up Calera next week. Vinod Khosla, founding Chief Executive Officer of Sun Microsystems, set out several years ago to fund energy start-ups, According to Khosla, if this works coal-fired power would become’ more than 100 percent clean.’

Power prices may rise in second half, China Power’s Lu says

March 6, 2010. China, the world’s second biggest energy user, may increase wholesale electricity prices for coal-fired power plants in the second half, China Power Investment Corp. President Lu Qizhou said.

Rising coal prices will likely result in losses for the nation’s coal-fired power plants in the first half and lead to an increase in power prices in the second half, Lu said in an interview after attending a meeting of the nation’s parliamentary advisory body. The price of coal for power stations gained 12.2 percent during the first two months of 2010 as compared with last year, Lu said.

The government, which controls electricity pricing, considers possible price increases by power producers such as Datang International Power Generation Co., Huaneng Power International Inc. and China Power Investment under a mechanism triggered when the price of coal rises more than 5 percent over a six-month period. China last adjusted its retail and wholesale power prices in November.

German nuclear talks messy, operators may still gain

March 5, 2010. Germany's nuclear power industry is no closer to knowing how long its plants may operate than five months ago when Chancellor Angela Merkel's new government assumed power and promised to extend their lives.

Rifts inside her center-right cabinet over the merit of rivaling renewables energies and a local election potentially threatening her party's leadership of a key state have delayed steps to free the 17 reactors from closure in the coming decade.

But analysts say having expected and priced in closures for as long as the 10-year old exit deal, the industry must keep its nerve and focus on the benefits from any leeway given. Even if operators must upgrade plants and share additional profits, they may still stand to earn billions of euros a year if largely written off plants produce longer than envisioned in the exit deal that wants plants to stop after an average 32 years of age.

Chinese thermal power plants may face huge losses this year

March 5. 2010. If regulators do not raise electricity prices, Chinese thermal power plants may face huge losses this year. Regulators will adjust electricity prices accordingly if average thermal coal prices in the country rise or fall 5 percent or more within half a year, from a year earlier. Thermal coal prices have risen 12.5 percent since the last price adjustment, but electricity prices have not moved.

Japan’s power demand may rise on plug-in cars, electric houses

March 5, 2010. Japan’s electricity consumption is set to rise 0.8 percent a year through March 2020 as consumers switch from natural gas and kerosene to electricity, according to a forecast by a power industry group. Electricity consumption may increase to 1.13 trillion kilowatt-hours in the year starting April 2019 from estimated demand of 999.4 billion kilowatt-hours in the current fiscal year, according to a report.

Consumers are using less kerosene for heating and natural gas for cooking and buying houses fitted only with electric appliances, which are marketed as safer in Japan, according to the report. The introduction of plug-in electric cars will further drive electricity demand, mitigating the impact of a declining population and energy conservation, said Tomohiro Jikihara, an analyst at Deutsche Securities Inc. in Tokyo.

China National Nuclear mulls IPO to finance expansion

March 5, 2010. China National Nuclear Corp., the country’s biggest operator of atomic power plants, may sell shares publicly to fund overseas projects as demand for clean energy increases.

China is urging nuclear equipment makers including rival China Guangdong Nuclear Power Group to partner with foreign firms to build reactors abroad. About 200 gigawatts of nuclear capacity is planned or being built worldwide as governments turn to non-fossil fuels to combat global warming, Nomura International said in a report in January.

China’s emergence as an exporter of nuclear power equipment would increase competition for Areva SA and General Electric Co., who were beaten in December to a $20 billion order in the Middle East by a group led by Korea Electric Power Corp. China is competing with South Korea, Japan and India for resources to drive their economies, with companies such as China National Petroleum Corp. and China National Offshore Oil Corp. seeking stakes in oil and gas fields in Africa and Latin America.

China may approve more companies to build nuclear power plants

March 5, 2010. China's Energy Administration is in the process of revising its guidelines and requirements for nuclear power plant operators. The move by China's top energy agency could mean that more power companies are able to build and operate nuclear power plants as the country looks to move away from energy sources like coal and oil. China isn't alone in its quest to boost nuclear power- other major developing nations have major expansion programs, and a raft of industrialized nations are mulling enhancing the fleets of reactors.

For China to forge ahead with its plans, the country needs to overcome a bottleneck in the number of companies approved to build and operate power plants. The review of regulations by the government could mean that soon independent power producers like Huaneng Power International Inc. (HNP) and Datang International Power Generation Co., could join the ranks of approved developers like China National Nuclear Corp., China Guangdong Nuclear Power Holding Corp.

South Africa seeks UK backing for power plant loan

March 4 2010. South Africa is seeking Britain's support for a potentially controversial $3.75bn World Bank loan for its hard-pressed electricity industry. It would assist in funding a new coal-fired generating plant, helping to prevent future power shortages, but also increasing the country's relatively high carbon emissions.

The state power company, Eskom, has been granted permission for a 25 per cent price increase but the industry regulator turned down its request for a 35 per cent rise. This has increased the need for the World Bank loan to fund the planned expansion of generating capacity. Eskom is preparing to build two big coal-fired plants. Some $3.1bn (€2.27bn, £2.05bn) of the World Bank money is needed for one of the power stations - a 4,800MW plant at Medupi while the rest would be spent on renewables and energy efficiency projects.

KEPCO in talks with Turkey for nuke plant exports

March 4, 2010. Korea Electric Power Corp. (KEPCO) and the Turkish government are likely to sign a memorandum of understanding (MOU) late this month on a joint study to build a nuclear power plant in Turkey.

Under the MOU, KEPCO and Turkey will form a task force to tackle such issues as site selection, period of construction and financing, the Ministry of Knowledge Economy said.

Turkey is still not fully prepared for nuclear projects despite its willingness. Accordingly, the MOU will give KEPCO a supporting role for Turkey on the project, it said. The country is currently eager to build nuclear power plants to meet its growing energy demand. The Korean government, however, was cautious not to get carried away with high expectations for the deal.

Linc says has offer for Australia coal assets

March 3, 2010. Australia's Linc Energy has received a written offer for three coal assets put up for sale last year, Linc said. Linc said it was weighing up whether to sell the assets together or individually. Linc plans to sell its Emerald, Galilee and Pentland coal mining tenements in Queensland state. The three undeveloped projects contain a total coal resources of over five billion tonnes of coking and thermal coal.

Renewable Energy / Climate Change Trends

National

Copenhagen Climate Change Accord: India, China back it

March 9, 2010. India and China formally backed the Climate Change Accord hammered out in Copenhagen last year calling for voluntary cut in greenhouse gas emissions. Both the countries submitted official letters to the UN Climate Change Secretariat saying that they agreed to being listed in the preamble of the Accord subject to certain conditions. "It may be recalled that India actively participated in the discussions on the Copenhagen Accord. India stands by the contents of the Accord," Environment Minister Jairam Ramesh wrote to the UN Climate Chief Yvo de Boer. "The Accord is only an input into the two-track negotiations. The Accord is not a new track of negotiations or a template for outcomes," he said.

Gail Kutch wind power plant to start by April

March 8, 2010. India’s largest natural gas transportation and marketing company Gail India has commissioned its first wind farm in Gujarat and plans to enter into commercial power generation through conventional and non-conventional energy resources.

State-owned Gail’s first wind power plant of 4.5 MW capacity at Sinoi in Kutch (Gujarat) will go on-stream by April. The company is also considering to set up two natural gas-based power plants in Usar (Maharastra) and Bettiah (Bihar) each. The capacity of the projects could be between 250 MW and 1,000 MW. The Rs 43.37 bn mission was launched in November last year under the National Action Plan on Climate Change. The mission aims at generating 1,000 MW solar power by 2013 and 20,000 MW by 2022. Companies setting up solar power projects will get several benefits from the government, such as tax incentives, under the scheme.

Policy support holds key to promote methane use

March 4, 2010. Requisite policy support holds the key to harness methane, a key greenhouse gas (GHG), opined various stakeholders at the Methane-to-Markets Partnership Expo. Methane is a primary component of natural gas and is generated from sources such as coal mines, landfills, oil and gas systems and agriculture.

Technologies have been developed in the past few years to recover methane from these sources and produce energy out of it. Methane-to-Markets (M2M), an international public-private partnership is holding its second global expo in Delhi, to promote recovery and usage of methane as a clean source of energy.

Biogas from sewage to produce electricity

March 4, 2010. Managing sewage has given many a sleepless night to the officials of the Bangalore Water Supply and Sewerage Board (BWSSB), what with the city discharging 700 million litres of it daily. After a dull public response put the board's plan of turning sewage into drinking water on the backburner, BWSSB is now setting its eyes on generation of biogas with the treatment of sewage. The BWSSB will construct 13 plants around the city to generate biogas from sewage.

Suzlon bags 52.5 MW order from Gujarat Petronet

March 4, 2010. Suzlon Energy has won an order from Gujarat State Petronet (GSPL) to set up, operate and maintain a 52.5 MW wind energy project in the Rajkot and Porbandar districts of the State. The project will be supplied 35 units of 1.5-MW wind turbine generators. The installation is scheduled for commissioning by July.

The power generated will be purchased by the Gujarat Urja Vikas Nigam under a long-term PPA (power purchase agreement) with GSPL. While the company did not furnish the project financials, sources said a mega watt cost could be about Rs 60 mn. Gujarat State Petroleum Corporation (GSPCL), the parent company of GSPL, has an existing wind power project of 52.5 MW in the Kutch district of Gujarat which was supplied, set-up and operated by Suzlon since July, 2009.

Suzlon said the current augmentation would take the group's overall wind power installed capacity to 105 MW in the State. The process to register existing wind power project with the UNFCC under the Clean Development Mechanism (CDM) programme has already been initiated and would also be followed for the new project, in a statement to BSE.

Global

SunPower to build two 1 MW solar power plants in Italy

March 9, 2010. SunPower Corp said it would partner with Italian investment and management company K6 S.a.S. to build two 1 megawatt photovoltaic (PV) solar power plants in the Puglia region in Italy. The two new plants are located in Casamassima and Conversano and will be complete by August, SunPower said.

The renewable solar power generated by the plants in Italy will provide electricity locally and contribute to the national electric grid, the company said. SunPower, which recently agreed to buy European SunRay Renewable Energy for $277 million, operates Italy's largest 24-megawatt solar power plant in Montalto di Castro.

US Solar company lands stimulus funds

March 9, 2010. Roseville's Solar Power Inc. said it has received $24.7 million in federal stimulus money and is considering opening a solar-panel plant somewhere in Sacramento County.

The stimulus grant was made by Sacramento County officials, who are trying to create manufacturing jobs to jump-start the economy. The company currently does its manufacturing in Shenzhen, China. Solar Power also announced it plans to build a 10-megawatt solar-electricity generation plant in Sacramento County.

Sahara desert solar project seeks above-market price

March 8, 2010. Siemens AG and Munich Re’s plan to develop solar-electricity generators in the Sahara Desert aims to win above-market prices for the energy they would export to Europe.

The Desertec Industrial Initiative will work with Morocco in the next month to arrange negotiations with the European Union to provide so-called feed-in tariffs for electricity produced by using large mirrors in the desert, Paul van Son, who heads the initiative, said today in an interview. Feed-in rates, or above-market prices subsidized by consumers, are used in most EU countries as incentives for producing more electricity and heat from wind turbines, solar panels and wood pellets.

Asia seen as growth driver for voluntary CO₂market

March 8, 2010. Fear of Western-imposed carbon tariffs on goods and services from Asia is likely to drive growth in offsetting emissions by large firms in the region, a voluntary carbon market executive said. The market, worth $705 million in 2008 and likely much less in 2009, relies on businesses to voluntarily manage their carbon emissions, for example from the energy they use to produce and transport goods around the globe.

Western companies can buy carbon offsets from clean-energy projects in developing countries, which boast a high number of plants that capture methane from landfills or wind farms for example. The offsets then allow these companies to cut their overall carbon footprint, or production of greenhouse gases, such as carbon dioxide.

EU faces court challenge over bio-fuels reports

March 8, 2010. Four environmental groups have sued the European Union's executive for withholding documents they say will add to a growing dossier of evidence that biofuels harm the environment and push up food prices. The lawsuit, lodged with the EU's General Court, the bloc's second highest court, alleges several violations of European laws on transparency and democracy.

The suit was filed by ClientEarth, Transport & Environment, the European Environmental Bureau, and BirdLife International. At stake is the EU's commitment to its goal of getting a tenth of its road fuels from renewable sources such as biofuels by 2020 -- a target that has spawned an EU industry worth around 5 billion euros ($6.8 billion) a year and a big market for imports from Brazil, Indonesia and Malaysia.

UK offshore wind costs at least twice nuclear: study

March 8, 2010. Generating Britain's electricity from offshore wind farms is likely to be at least twice as expensive as nuclear power, according to a new report by engineering consultants Parsons Brinckerhoff. Britain plans to build up over 30 gigawatts (GW) of offshore wind power capacity by 2020 and wants to build new nuclear power plants to replace old reactors.

The government's nuclear plans are opposed by some environmental groups as being too costly. The report identified tidal power generation as the most expensive source of electricity for Britain, with costs likely to be in a 16-38 p/KWh range, while onshore wind costs of 8-11 p/KWh are competitive with gas at 6-11 p/KWh.

Germany casts doubt on 2010 climate change deal

March 8, 2010. German Chancellor Angela Merkel says she is not sure whether there will be a global climate change deal this year setting binding emissions targets for the time beyond 2012. Merkel said she hopes for progress on voluntary pledges toward limiting global warming to 3.6 degrees Fahrenheit (2 degrees Celsius). Merkel said binding targets are opposed by China and India, which she called a "structural problem" for a new climate treaty. The next U.N. climate summit is scheduled for the end of the year in Cancun, Mexico.

Global climate battle plays out in World Bank

March 7, 2010. The United States and Britain are threatening to withhold support for a $3.75 billion World Bank loan for a coal-fired plant in South Africa, expanding the battleground in the global debate over who should pay for clean energy.

The opposition by the bank's two largest members has raised eyebrows among those who note that the two advanced economies are allowing development of coal-powered plants in their own countries even as they raise concerns about those in poorer countries. While the loan is still likely to be approved on April 6 by the World Bank board, it has revealed the deep fissures between the world's industrial powers and developing countries over tackling climate change. Both camps failed to reach a new deal in Copenhagen in December on a global climate agreement because of differences over emissions targets and who should pay for poorer nations to green their economies.

Florida Power (FPL) building world's 2^nd largest solar plant

March 5, 2010. FPL Group, the parent of Florida Power and Light is building a solar plant that will be adjacent to a natural gas power plant. The advantages are the solar plant will piggyback onto the existing infrastructure and power grid. When it is completed by the end of the year, it will be the world’s second-largest solar plant. It will be located across 500 acres north of West Palm Beach.

The plant should be about 20 percent cheaper to run than a stand-alone solar facility. At its peak, the solar plant will be able to generate 75 megawatts of power, enough for about 11,000 homes. It will be dwarfed by the adjacent gas plant, which can produce about 3,800 megawatts of power. (A megawatt is enough to power a Wal-Mart store.)

German emissions fell last year on recession

March 5, 2010. Germany’s greenhouse-gas emissions fell 8.4 percent in 2009 as factories and power plants cut output in a contracting economy, the nation’s environment ministry said today. Total emissions, which include carbon dioxide, fell by 80 million metric tons, the German ministry said in a faxed statement. Germany’s output of heat-trapping gas has fallen 29 percent since 1990, the base year for reductions under the Kyoto Protocol, the ministry said.

Germany, the biggest economy and emitter in the Europe Union, shrank 5 percent last year. EU carbon emissions from factories and power stations fell 10 percent last year to 1.9 billion tons.

China may start its first city-wide carbon cap-and-trade system

March 5, 2010. China may start its first city-wide carbon cap-and-trade system by June as the world’s biggest polluter seeks to rein in emissions. The northeast port city of Tianjin plans to impose a mandatory limit on energy used to heat buildings in the first half of this year. Property managers able to reduce energy use to below the limit will earn credits they can then sell.

UN carbon board ‘concerned’ as offset prices slump

March 4, 2010. Regulators overseeing the world’s second-biggest emissions market are concerned that low prices for emissions credits are sapping support for carbon trading, a UN board member said.

The price of UN carbon credits, which governments and companies can purchase to offset their emissions of greenhouse gases, are languishing at a fraction of the 100 euros ($136) that is necessary to “de-carbonize” the economy. Prices extended losses afters world leaders failed to agree on tighter pollution curbs at the Copenhagen summit in December.

IBM banks on China for growth in energy div

March 4, 2010. IBM sees strong market potential for "smart grids" power distribution systems in China as the country seeks ways to use energy more efficiently.

Technology giants including Google Inc, Cisco and Microsoft are investing heavily in smart grids, intelligent power-distribution systems designed to be more responsive and interactive than today's traditional power grids. In terms of countries, China, the world's biggest greenhouse-gas emitter, is investing the most.

China winning green race: venture capitalist

March 4, 2010. China is leapfrogging ahead in the development of green technology, and the United States is "barely in the race," a prominent Silicon Valley venture capitalist said. Kleiner Perkins, which typically invests in early-stage start-up companies, is best known for its investment in Netscape, Amazon, Google and Genentech. China grew its market share in the solar industry to nearly 50 percent in the fourth quarter of last year from just 2 percent three years earlier. The United States, on the other hand, went from 43 percent to 16 percent in the same period.

Labor, environment groups push "green" broadband

March 4, 2010. Labor and environmental groups joined with the U.S. government to promote high speed Internet access and related technologies to create green jobs and help lift the United States out of recession.

Policies to support broadband technologies providing high-speed Internet access can reduce energy use and greenhouse gas emissions that spur climate change, according to a report released by the Blue Green Alliance, the Progressive States Network, the Sierra Club and the Communications Workers of America.

Little room for hybrids, EVs in Europe for a decade

March 3, 2010. Hybrid and electric cars are the stars of motor shows, but the expensive technologies could take a decade to really hit European roads as automakers improve petrol and diesel cars to meet short-term emissions targets.

The planned launch of the first zero-emission electric cars from Nissan Motor Co, Daimler AG and Mitsubishi Motors Corp this year, as well as debut of hybrid cars from a growing number of European brands has renewed the buzz around electric powertrains as promising solutions to reducing emissions in carbon dioxide-conscious Europe.

But most automakers gathered at the Geneva auto show this week said the most practical road to meeting Europe's 130g/km CO₂ emissions target by 2015 was to improve conventional gasoline engines, downsize their cars, or offer more diesel engines, which are 20 to 30 percent more fuel-efficient than their petrol cousins.

Hopes for global carbon market dim

March 3, 2010. Investors are becoming less convinced that a global carbon market, estimated to be worth about $2 trillion by the end of the decade, can be established as uncertainty over global climate policy persists. The absence of legally binding global climate deal and a federal emissions trading scheme in the United States are standing in the way of the market in global emissions trading growing to achieve yearly turnover of $2 trillion by 2020. The market for carbon credits was worth around $136 billion last year, according to analysts Point Carbon. Highlighting these fading hopes, a Point Carbon survey showed 61 percent of respondents said they expected a U.S. emissions trading scheme by 2015, down from 90 percent last year.

Carbon traders question Europol’s EU5 billion fraud estimate

March 3, 2010. The Carbon Markets and Investors Association is questioning whether a law-enforcement estimate that fraud has robbed European nations of about 5 billion euros ($6.8 billion) of tax revenue is too high. European Union countries lost that amount over about 18 months ending in December because of value-added tax fraud in the market for carbon dioxide permits, Europol said. Trading in spot European Union allowances rose in the first half of last year amid falling prices.

Europe all mouth and no money in green tech race

March 3, 2010. Europe's plan to lead the green technology race has a gaping financial hole for the next four years, handing the advantage to rivals China, Japan and the United States. Even after 2014, when the European Union budget should have been thoroughly overhauled, there is no guarantee that green tech will have triumphed in a battle for funds versus the powerful farming lobby. European Commission President Jose Manuel Barroso is expected to champion green growth as a means of protecting the climate and boosting jobs. Industry experts say the EU currently has a pot of around 7.5 billion euros ($10.2 billion) available for green tech research.

U.K. Solar industry may grow 50-fold, create jobs, Sharp says

March 3, 2010. Britain’s solar industry may create thousands of jobs and expand by a factor of 50 after the government guaranteed above-market prices for clean power sources, the head of Sharp Corp.’s U.K. solar division said. Photovoltaic or PV panels, which generate a charge when exposed to the sun’s rays, reap the most generous subsidies and may spur installation of 250 megawatts of panels in 2011 compared with 5 to 6 megawatts last year. Prime Minister Gordon Brown’s government announced that from April it will reward homeowners for producing their own electricity with guaranteed prices known as feed-in tariffs. The plan is aimed at boosting the share of U.K. electricity generated from renewable sources to 30 percent by 2020, from 5.5 percent now.

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