Monthly Archives: April 2013

Tata Power eyes coal assets freed by global fracking boom

Tata Power is seeking coal assets in the US, Canada and Colombia as prices of the fuel drop.

Tata Power Co., India’s second- largest generator, is seeking coal assets in the US, Canada and Colombia as prices of the fuel drop amid surging shale gas supplies in North America.

Initial purchase talks are on for several mines, managing directorAnil Sardana said in an interview, declining to identify the assets. Acquisition prospects in South Africa, where Tata Power has scouted for more than a year, have dimmed because of infrastructure concerns, he said.
“We just want cheap coal and there are several assets that are languishing after the shale gas boom in North America,” Sardana said. “A lot of assets got abandoned because of the boom as existing buyers moved on to shale gas.”
Cheap coal may help Tata Power, led by Cyrus Mistry, to turn its biggest power plant profitable after a purchase of mines in Indonesia turned sour as the Southeast Asian nation pegged its coal to global benchmark prices. US power generators have turned to gas extracted from shale rocks as hydraulic fracturing, or fracking, has made the country the world’s biggest producer of the less polluting fuel, while freeing up coal reserves.
Lack of railroad facilities and inadequate port handling capacities that can transport coal from the mines to the nearest shore are veering Tata Power away from assets in South Africa, Sardana said. The acquisition costs for such mines increase because miners have to spend time and money to build the infrastructure, he said.
Tata Power gained as much as 0.5% to Rs.95.75 and traded at Rs.95.60 as of 10:22 am in Mumbai. The shares have dropped 13% this year, compared with a 0.5% gain in the benchmark S&P BSE Sensex.
Coal Shortage
A shortage of local coal supplies and Indonesia’s move have driven up costs for Indian utilities includingAdani Power Ltd and Tata Power, which have little choice but to bring in Indonesian supplies because buying coal from other nations would boost shipping charges.
Trouble for Tata Power began when Indonesian prices increased following the change in regulation. Tata Power, which owns stakes in PT Kaltim Prima Coal and PT Arutmin Indonesia, both controlled by PT Bumi Resources, and a 26% stake in PT Baramulti Suksessarana, had won the contract to build a 4,000-megawatt plant at Mundra in Gujarat state in December 2006 after bidding the lowest tariff ofRs.2.26367 a kilowatt- hour.
The coal from Indonesia, which was $42.13 a ton at the time, has since jumped 79%.
Mundra Tariff
Tata Power needs Rs.0.54 more per kilowatt hour for electricity from Mundra to erase losses, Sardana told Bloomberg TV India in an interview 15 April. The company has written off Rs.2,650 crore ($488 million) on its Mundra unit, he said.
The unit may suffer a loss of Rs.47,500 crore over 25 years, considered the lifetime of a plant, should the current tariff be maintained, Tata has told the industry regulator, which has recommended the producer must be compensated for the increase in coal costs.
Tata Power reported its first annual loss of Rs.1,088 crore for the year ended March 2012, dragged down by Mundra and currency fluctuations.
It’s unlikely the Indian states buying power from Mundra will accept the regulator’s order, said Sachin Mehta, an analyst at Mumbai-based IFCI Financial Services Ltd who maintains a sell rating on the stock. Five Indian states that have contracted to buy 3,800 megawatts of electricity from the Tata Power plant have resisted tweaking the contract norms.
“Tata Power is not very bullish on India and is seeking to grow through overseas operations,” Mehta said. “Yet, raising funds for an acquisition or a new project will not be easy, considering the losses it is suffering at Mundra.”
Shale Boom
The boom in fracking, which shatters shale rocks using pressurized water to pump out gas and oil, in the US and Canada has absorbed bulk of the energy demand, freeing up large quantities of coal reserves. The assets can help Tata Power revive the unprofitable 4,000 megawatt Mundra power plant and aid Asia’s third-largest economy prevent outages such as the world’s worst blackout that left 640 million people without electricity last year.
“The current price points of shale gas have fundamentally changed the cost economics in the US,” saidArvind Mahajan, partner and head of energy, infrastructure and government practices at KPMG LLP. “There’s a clear shift in feedstock preference towards gas whose supply has increased in a step function. This is rendering a lot of coal reserves surplus and ready for exports.”
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Britain looks to tackle deadly legacy of nuclear power plants

Britain is set to tackle a 60-year-old problem that has dogged successive governments: how to resolve the deadly legacy from the country’s first generation of nuclear power plants.

The UK is home to the world’s largest stockpile of plutonium, with more than 100 tonnes of the highly radioactive material.

The Nuclear Decommissioning Authority, whose job it is to look after the plutonium, is preparing to give its recommendation on how the government should deal with the problem, with an announcement expected as early as next month.

In the early days of the UK’s civil nuclear programme some forecast that uranium – used to fuel conventional reactors – would rapidly run out. The UK decided to stockpile plutonium – which is extracted from reprocessed nuclear waste – as an alternative to be used in a new generation of experimental reactors.

However, not only were the forecasts about uranium wrong but the reactors were never built.

Storing the plutonium has become an expensive business whose bill is picked up by the taxpayer. While the material can be used to fuel nuclear reactors, some of the technologies are unproven, and plutonium’s toxicity makes prolonged storage risky.

The government has previously said its preferred option is to convert the plutonium into so-called mixed oxide fuel, or Mox, for use in new reactors.

However, the NDA has also been considering two alternative proposals from nuclear technology groups, GE Hitachi, the US-Japanese joint venture, and Canada’s Candu.

“We have some market tension going,” says Adrian Simper, the NDA’s strategy and technology director, adding that the intention is to recommend whether “there are three options, two or one – or even none”.

All three carry their own risk – and cost. If the government decides to turn the plutonium into Mox it would require hefty investment in the form of a plant to make the material. The cost depends on a variety of factors, including how much is produced.

To convert 40-60 tonnes a year would require an estimated capital cost of £1bn-£2bn, according to Areva, the nuclear technology group that has been turning spent fuel from reactors into Mox for several decades in its native France. Other estimates have suggested a new plant could cost double that amount.

“We are open about what kind of role we can play,” Dominique Mockly, head of used nuclear fuel and related services at Areva, says of the company’s interest in the UK. “The solution is easy to implement as it is industrially viable,” he added.

Britain has tried Mox before. A previous plant built at Sellafield in the 1990s was dogged by technical problems and produced a minimal amount of fuel. It was closed in 2011 after the accident at Japan’s Fukushima plant.

The second option is to use the EC-6 reactor built by Candu, which can burn different types of elements, including natural uranium and Mox fuel. This would also require the building of a Mox plant, and the design would still need to be licensed in Britain.

Under the third proposal, from GE Hitachi, the plutonium would be burnt in one of its fast breeder Prism reactors. They burn plutonium to produce electricity and the by-products can be used for other types of nuclear power stations.

While critics have said the technology is not mature enough, GE Hitachi has promised to build the twin reactors without any public subsidies and charge only for the amount of plutonium processed.


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Get your own Solar rooftop PV plant with 30% subsidy : New scheme by SECI

Do you want to go Green with saving in electricity bill?
Do you have a rooftop area of 1000Sq meter or above?
Do you have a minimum electrical consumption of 100Kw to 500KW?

If, yes the newly launched pilot scheme of SECI is the answer to all the questions. The scheme is launched all over India, rooftop grid and off-grid project in range of 100kW to 500kW. The scheme will benefit most the commercial establishment who are paying high electricity bills and cannot go for open –access as they are below 1MW load.
The government is providing a subsidy of 30% and above all there is also a provision to feed extra electricity produced during minimum load hours to the grid.
The other benefit is income tax savings through Accelerated Depreciation. However, it is not clear that can these projects will also be eligible for RECs.
The proposals for pilot scheme are invited and preference will be given to projects which have fund arrangement in place. By industry standard the 100KW plant will be requiring an investment of around INR 9- 10 million.

Click For the Document

If you are interested write to us at and get free consultancy services.

“Inverter” Heart of the Solar System

Inverters are the heart of Solar power system, it facilitates the conversion of DC into AC so that generated power can be effectively consumed by home appliances or can be fed into the grid. Solar system is always producing DC, so every system needs inverter.
In India as per CERC tariff guidelines, for Solar PV total cost considered for Inverter is just 60 Lakh/MW which is nearly 7% of total cost, previously it was near about 1 Lakh/MW. Decreasing trend in the price of inverter increases the pressure on manufacturer to provide maximum facilities in minimal cost. But in this era where prices are decreasing rapidly, technology will be playing very critical part in capturing market share.
Delta Electronics is showing very good presence in Inverter business & has a good market share amidst the presence of market leaders like SMA & Power One.
In 1 day workshop in the office of Delta Electronics we came to know few good things about Inverters. They are 2nd in terms of market share of string inverters & also trying to capture market of central.
Features of Inverters
? Inversion function
? Maximum Power Point Tracking
? Anti-islanding
Inverters are classified as grid connected inverters & off-grid inverters. Inverters are also available in single phase & three phases which are used as per their requirement. Inverters with dual MPPT is in trend & most of the developers prefer to have it with their inverters.
In industry three types of inverters are in trend out of which string & central are famous among developers in India while micro inverters still faces problem in market entry.
String inverters are available with or without transformer with largest size of 30 KW. They have plug in play type of string inverter which is easily placed below the modules which saves land. Without transformer, inverters are lighter weight & have higher efficiency. Similarly central inverters are very big in size even in the range of MW capacity & needs huge land separately to place it. Delta central inverters have such an arrangement that even if part of inverter get damaged, only a limited amount of power gets affected (rake of inverter), while other part of inverter functions normally & we need to replace only a small portion of inverter. Micro inverters are yet to get trendified, so most of the manufacturers are not showing their interest towards it.
Downtime is reduced in string inverters while it is little expensive then central inverters. Its working is not affected by damage of one inverter while central inverter working is affected badly. Although String Inverter has very few installations worldwide, the reason being higher investment cost.

NSL Renewable Power to raise $60 million

NSL Renewable Power Pvt Ltd has executed investment agreements to raise $60 million (about Rs 330 crore) from a group of investors.

The renewable energy company is part the Hyderabad-based diversified NSL Group.

The investors comprise Development Finance Institutions, DEG from Germany and Proparaco from France, Asia Clean Energy Ltd, a private equity fund from South Korea and GS Power from South Korea.

Existing investors in the company — International Finance Corporation and FE Clean Energy — also participated in this round of fund raising.

The company plans to use the proceeds raised to fuel its growth in wind and hydro power sectors.

It currently has 185 MW of installed capacity, which includes 148 MW of wind, 20 MW of solar, 12 MW of biomass and 5 MW of hydel Power.

The investment will give the company the required financial support to more than double its capacity over the next 18 months.

M. Prabhakar Rao, Chairman, NSL Group, in a statement said: “The investment from these reputed development institutions and financial investors is a testament to our capabilities in this sector. It validates the strong business model that NRPPL has built over the past several years.”

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L&T set to bag Rs 2,100-cr order for TN solar plant

Engineering major L&T is set to bag a Rs 2,100-crore engineering, procurement, construction order for a 300 MW solar power plant coming up in Tamil Nadu.

The solar park is coming up in a joint venture of the INDarya Green Power Pvt Ltd and the Tamil Nadu Government’s industrial development arm, TIDCO. The INDarya group owns the President Hotel in Chennai. The park is coming up near Manamadurai, where INDarya already has over 2,130 acres of land in its possession.

A 300 MW solar park would typically call for an investment of about Rs 3,000 crore.

The project developers do not intend to get into electricity generation. The idea is to develop a solar park in a modular fashion — 300 plants of 1 MW each. These plants will be sold to those who wish to own solar plants and sell electricity. In an e-mail response to BusinessLine query, A. Jagannathan, Head-Projects, INDarya, said, “Larsen and Toubro would do the EPC and will handle all technical aspects related to the park.” On a ballpark basis, a EPC contract is not less than Rs 7 crore a MW.

The project features a 230 kV sub-station within its premises. The developers promise complete infrastructure such as roads, lights, water, drainage and natural fencing.

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IFC to light homes not connected by electricity network in India

South Asia accounts for 15 per cent of IFC’s clean energy portfolio. The group has launched new lighting programme – Lighting Asia/India – that would popularise renewable lighting solutions in Indian villages that are not connected by electricity network.

“IFC is taking initiatives to create a sustainable ecosystem to promote adoption of modern and clean lighting solutions in areas without energy access,” said Jeeva Perumalpillai-Essex, Manager, Sustainable Business Advisory, IFC South Asia.

The global organisation has adopted a four-pronged approach to popularise solar off-grid lighting solutions.

First, IFC will work with stakeholders, including manufacturers of solar lighting equipment, to develop quality products and assist with quality assurance standards.

Second, it will collaborate with distributors to penetrate untapped markets and design scalable business models by supporting them through market research.

Third, it will work with financial institutions and small and medium enterprises to increase access to working capital for companies and underserved populations.

And fourth, IFC will work with consumers, by conducting mass education campaigns to generate awareness and demand.

According to IFC, the grid failure in India last year affected nearly 400 million people. But, for another 400 million, this is an everyday reality, as they continue to depend on kerosene, candles, charcoal, and firewood to meet lighting needs.

In line with IFC’s climate change strategy, this programme will avoid an estimated 64,000 tonnes of carbon emissions.

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LME & Metals Trading companies to gather at the upcoming ‘Annual Metals Trading Operations & Technology Summit’ next month in London

Feautred Post: IRN is hosting the 4th Metals Trading Operations & Technology Summit, 15-16 May in London, bringing together the key players in the metals trading industry


IRN, global summit organiser, will be hosting the 4th Metals Trading Operations & Technology Summittaking place 15-16 May at the Charing Cross Hotel, London.

The summit creates a platform for the metals trading community to meet with the key players of the sector to learn more about how they can tackle the challenges they are facing within the operational and technology functions of their business.

Key practitioners within the trading houses, investment banks, metals fabricants and metals consumers companies will be speaking and attending the forum. CIOs, CTOs, COOs, Heads of Operations, Risk Directors, Compliance Managers, IT Infrastructure Managers, and many more will share their views on the current metals trading sector in a highly interactive setting. MTOT 2013 will allow for networking as well as learning in the luxurious environment of The Charing Cross Hotel.

Companies in attendance include:

  • London Metal Exchange
  • Aurubis
  • Elval – Viohalco Group
  • Luvata
  • Mitsubishi Corporation
  • Rusal
  • Stemcor
  • Triland
  • BNP Paribas
  • Deutsche Bank
  • Newedge

….and many more


The event is sponsored by key service providers that will showcase their solutions specifically developed for the metals trading industry: FFastFill, Baringa, Digiterre and OpenLink.

For more information regarding the summit and for registration inquiries, please contact Jessica Jonah at JessicaJ(at)irn-international(dot)com

U.S. Weighs Legislation to Cut Clean Energy Capital Costs

The U.S. government may propose legislation that would help investors lower the cost of capital for renewable-energy projects, the acting energy secretary said.

“We’ve got to lower the cost of capital for energy investments, particularly for those that don’t have commodity costs,” Daniel Poneman, deputy secretary at the Department of Energy, said today at the Bloomberg New Energy Finance conference in New York today. He took over as head of the department earlier this week when Steven Chu resigned.

Global investment in renewable investment slumped 11 percent to $269 billion last year, the first decline since 2009, according to New Energy Finance. The UN estimates that annual investments of $700 billion to $1.8 trillion in sustainable- energy development are needed to avert environmental catastrophes related to climate change.

“The innovation, the creativity in crafting financial instruments to lower the cost of capital for renewables will be absolutely essential,” said Poneman, the deputy U.S. energy secretary who’s overseeing the agency until a successor is confirmed. “Some will require legislation.”

Power plants that turn wind and sunlight into electricity require significant upfront funding, and the technologies’ lack of established history and other perceived risks may deter some investors, he said. Legislation may provide incentives that make renewables more attractive to investors.

Alaska Senator Lisa Murkowski, the top Republican on the energy committee, and SenatorChris Coons, a Delaware Democrat, were among four lawmakers who introduced legislation today that would let renewable projects take advantage of a tax-advantaged corporate structure known as master-limited partnerships.

Natural Gas

As renewable energy becomes more widely used, arranging financing will get easier, Poneman said.

“As people become familiar with it, a larger pool of capital itself will help lower the cost of capital,” Poneman said in an interview today. And until then, booming supplies of natural gaswill help reduce carbon emissions.

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Poland Prioritizes Cheap Power in Shift Away From Coal

Poland is prioritizing low-cost electricity as it revamps its energy policy and shifts away from its reliance on coal-fired generation, the nation’s environment minister said.

Marcin Korolec said he’d like to phase out subsidies for both clean power and fossil fuels, though the country must also replace aging power stations including some that are more than 40 years old.

“We are in quite a big crisis,” Korolec said yesterday at a Bloomberg New Energy Finance conference in New York. “We need new investment, but we are living in this paradigm of expensive energy prices. We are facing tremendous questions. Technology will answer the question, and price will answer it.”

The comments indicate how Prime Minister Donald Tusk’s government will balance demands to meet European Commission environment rules while limiting electricity costs. The Commission has censured Poland for its delays in implementing mandates for renewable energy, and the government this month announced plans to reduce subsidies for clean power.

Poland was one of the nations that blocked the commission’s proposal for boosting the price of carbon dioxide emissions. It’s also hosting the annual round of United Nations global warming talks, which start in November in Warsaw.

Korolec expressed skepticism about technology that captures carbon from smokestacks and stores it underground, called CCS, something that could scrub pollution from Poland’s coal plants. Utility scale CCS plants haven’t opened yet.

View on CCS

“CCS is a beautifully romantic story, but I don’t see it,” Korolec said during a panel discussion. “It is cheaper to build a gas plant.”

David Sandalow, assistant secretary for public policy at the U.S. Energy Department, agreed that even the latest carbon capture technologies are too costly to be competitive with other forms of reductions such as energy efficiency and wind power.

“It’s still expensive to strip out carbon from exhaust streams,” Sandalow said on the panel. “We believe it’s important because we need some form of CCS to have an impact on climate change.”

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