Monthly Archives: May 2014

Now, green nod for infrastructure projects in 10 days

Ministers and officials in the environment ministry would no more be able to sit indefinitely on files related to green clearances to infrastructure projects as government is coming out with a new system that would put timelines at all levels in the ministry – director to minister – for clearing or rejecting them. The environment minister would also have only 7-10 days to either approve or reject it.

This system would be put in place from July for forest clearances and from first week of September for environment clearances. The industry would also be able to track their projects at every level rather than being in dark all the time till the projects are finally cleared or rejected. It would be for all kinds of projects – mining, hydropower, power, roads, ports, airports and others.

Often accused of delaying green clearances, environment ministry many a time has accused state governments for not coming back in time with details for clearing the projects leaving projects stuck. Thus this system also puts a time period on state government to take a decision.

Last year, after environment minister Jayanthi Natarajan was replaced by M Veerappa Moily, several unconfirmed reports revealed that the minister was apparently sitting on several mega projects for months for no reason at all even when their files were complete and only her final decision was awaited.

Thus Congress-led UPA government in a last-minute change brought Moily to pacify the industry which repeatedly had complained of green hurdles in India’s development.

To remove the root-cause of this problem, the government had formed a joint team of representatives from CII, FICCI, environment ministry and Indian industry to bring out a transparent and accountable mechanism for granting environment and forest clearances. During the process around 100 industry members gave inputs apart from other stakeholders. The team minutely looked at the process of the environment ministry for giving green clearances.

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Source: DNA

Power crisis in Delhi averted; NTPC paid Rs 700 cr dues by BSES discoms

Two state-owned lenders to the electricity sector, Power Finance Corporation (PFC) and Rural Electrification Corp (REC), have rescued Reliance Infrastructure-owned power distribution companies in Delhi by helping them pay off generator NTPC Ltd’s past dues.

PFC and REC together disbursed Rs 1,000 crore loan to the two discoms – BSES Yamuna (BYPL) and BSES Rajdhani (BRPL) — today. It was the last day for clearing NTPC’s Rs 700 crore dues as per Supreme Court’s May 6 order. NTPC had been threatening to cut off the national capital’s supply if unpaid.

“Both PFC and REC have disbursed Rs 500 crore loan each, as requested by BSES, today. NTPC has been paid,” said a person close to the development.

A senior NTPC executive confirmed saying, “The payment of Rs 700 crore due from the BSES firms has been received. We will not regulate (cut off) power supply now.”

NTPC had in May sought the apex court’s permission to begin regulation of power supplied to BSES firms arguing nearly 75 per cent of the payments received from these two firms go to Coal India Ltd and if the two companies do not pay, NTPC’s Badarpur thermal plant will not be able to supply electricity to Delhi.

The payment dues of Rs 700 crore cleared today included arrears for power supplied by NTPC to the two discoms in April and part payment due for supplies to BYPL for electricity purchased between January and March. The apex court had allowed the generator to snap supply if unpaid.

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Source: BS

North India grid had load loss of 8,000 MW in storm yesterday

NEW DELHI: The northern electricity grid suffered a load loss of 8,000 MW, including 3,500 MW in the national capital, during a fierce storm in the region yesterday and power supplies are gradually being restored. 

Supplies were affected due to heavy rains, dust and thunderstorms and wind speeds exceeding 75 kmph in areas of Delhi, Uttar Pradesh, Haryana and Uttarakhand yesterday evening. 

“As a result, 68 transmission lines tripped. The load loss was at the rate of 200 MW per minute, resulting in a northern grid load loss of about 8,000 MW, including 3,500 MW in Delhi,” the Ministry of Power said in a statement today.

Piyush Goyal, Minister of State for Power (independent charge) today reviewed the situation arising out of the load interruption, according to the statement. The ministry also said restoration work has started.

“Out of 68 lines that tripped during the incident, 49 lines have been restored and supply has been restored gradually in all the states,” it said.

In Delhi, top priority was accorded to restoring power to emergency services such as hospitals, Delhi Metro, water treatment plants and the New Delhi Municipal Council area, it said, adding that presently, about 3,800 MW load is being met.

Assistance was provided to Delhi through the Emergency Restoration System (ERS) for early restoration of affected lines, especially Mandola-Gopalpur, Bawana-Rohini and Bamnauli-Pappankalan, which are affecting po ..

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Source: ET

Suzlon Group turns EBITDA positive in Q4, after 7 quarters

  • Revenue at Rs. 6,581 crore , 54 % YoY growth
  • Positive EBITDA of Rs. 328 crore/ ~ 56 Million USD
  • Positive EBIT of Rs 116 crore / ~ 20 Million USD
  • Strong order Book of Rs. 46,000 crore / 7.6 Billion[1] USD

Pune, India: Suzlon Group, the world’s fifth largest* wind turbine maker, on Friday May 30th 2014, announced its results for fourth quarter (Q4) of financial year 2013-14 (FY14).

Mr Tulsi Tanti, Chairman – Suzlon Group, said: “FY14 has been an important year for Suzlon, wherein we achieved significant progress by improving our business efficiency. The group is now transiting from a restructuring mode to a growth phase given the opportunities due to strong industry outlook. On the global front we remain confident about the wind sector and expect ~40% growth in Industry due to buoyancy in global markets, policy initiatives and economic recovery. The Indian markets will show growth and momentum with the re-instatement of GBI, availability of funds and a stable government.

In FY15, our key priorities will be to ramp up volumes, improving business efficiency and rebalancing our capital structure. With innovations in technology and solutions, we remain competitive and well positioned in all the key markets for onshore and offshore WTGs.”

Mr. Kirti Vagadia, Group Head of Finance, said: “We have delivered revenues of Rs. 6,581 crore in quarter four (Q4) which is the highest in the last 8 quarters. We turned EBITDA and EBIT positive after 7 quarters. Our Q4 EBIDTA show significant improvement by Rs 923 crores on YoY basis. We continue to improve on Net working Capital which is at 3.6% of revenue as against 13.6 % in FY13. On the FCCB front, we have concluded our discussions with the ad-hoc committee of bondholders. The Board has approved cashless restructuring of its Foreign Currency Convertible Bonds (FCCBs) and the new restructured FCCBs will come up for maturity in July 2019.”

Key Updates

  1. Financial Performance:
  • Revenues

o   Rs. 6,581 Cr in Q4 FY14, a 54% YoY growth.

o   Consolidated revenues of Rs. 20,212 cr in FY14, a 8% YoY growth

  • EBITDA & EBIT

o   Positive EBITDA achieved after 7 quarters

o   Positive EBITDA at Rs. 328 cr/~US$ 56mn, vis-a-vis negative Rs.(594)cr / US$ (101) mn

o   Increase in revenue by leveraging on a favourable geographic and product mix with focus on cost reduction

o   Substantial progress achieved in cost reduction through group wide restructuring efforts

  • Robust performance by Senvion; Increased Profitability

o   EBITDA at ~EUR 146mn is 22% higher, despite 19% drop in revenue at ~EUR 1,806mn

 

  1. Robust Order book :
  • Consolidated Group order book at ~5.3 GW approx. Rs. 46,141 crore / USD 7.6 bn

o   Onshore markets:

  • Emerging : ~US$ 1.3 bn ( India, Brazil, Turkey & Uruguay),
  • Developed : ~ $5.1 bn  

o   Offshore – US$1.2 bn

 

  1. Comprehensive Liability Management:

We had launched a Comprehensive Liability Management Programme last year. With the CDR implemented, overseas FX facility refinanced via largest and unique credit enhanced bonds issuance the programme has now reached its last leg. The bondholder’s meeting is scheduled on 9th July 2014 to approve a restructuring proposal including cashless exchange into new bonds with 5 year bullet maturity.

  • Negotiations with ad-hoc committee of FCCB holders concluded
  • Equity infusion under CDR completed.

  1. Project transformation completed:
  • Approx. 3,200 headcount right sized since FY12
  • ~31 % fixed opex reduction since FY12 (Suzlon Wind)
  • Restructuring goals at Senvion achieved, savings significantly exceeded target
  • Working capital rationalized to ~3.6%

  1. Asset sale achieved during FY14
  • Big Sky wind farm sale completed for ~US $ 90mn
  • China asset stake sale completed for US $ 28mn

  1. OMS: Owing to a large installed base in the country i.e. installation to the tune of over 8GW, the India OMS business has been carved out into a separate wholly owned subsidiary namely; Suzlon Global Services Limited. This has enabled better transparency and helped realize business efficiencies.In FY14, Suzlon Group OMS division has achieved revenues of ~Rs.2,700 Cr, with ~37% YoY growth.

 

  1. Senvion: Suzlon acquired Senvion in 2007 and has enabled it grow manifold. From revenues of ~€400m, Senvion has now grown to ~€1800m of revenues with strong presence not only in its traditional European markets (Germany, France and UK) and but also acquired dominating position in new markets like Canada and Australia. Senvion has also solidified its position in offshore segment with its 5M/6M products and now boasts of 100+ offshore turbines operating. Over the last five years, Senvion has been probably one of the very few companies to have consistently remained profitable despite very difficult market conditions. Some of the key highlights of Senvion FY14 performance:

  • Achieved ~26% increase in EBIT despite ~19% decline in revenue
  • Senvion successfully closed its cost restructuring exercise by significantly exceeding its initial cost saving target
  • Crossed the 1 GW milestone in UK bringingits cumulative installation to > 10 GW while strengthening its position in core markets around the world

The Group is now transiting from restructuring mode to growth phase given the opportunities and strong industry outlook. In FY15 we will focus on enhancing business efficiency, increase in sales volumes and rebalancing our capital structure.

The group remains confident of improving the performance further in FY15.

About Suzlon Group:

The Suzlon Group is ranked as the world’s fifth largest* wind turbine supplier, in terms of cumulative installed capacity and market share, at the end of 2013. The company’s global spread extends across Asia, Australia, Europe, Africa and North and South America with over 24,200 MW of wind energy capacity installed, operations across over 30 countries and a workforce of over 10,000. The Group offers one of the most comprehensive product portfolios – ranging from sub megawatt onshore turbines at 600 Kilowatts (kW), to the world’s largest commercially-available offshore turbine at 6.15 MW – with a vertically integrated, low-cost, manufacturing base. The Group – headquartered at Suzlon One Earth in Pune, India – comprises Suzlon Energy Limited and its subsidiaries, including Senvion SE. Visit us at www.suzlon.com

Jharkhand govt initiative to increase electricity production

Jharkhand energy minister Rajendra Prasad Singh today said the state government has taken initiative to set up new power plants in the next couple of years.

Singh regretted that no a single MW was added in the electricity generation since the state was carved out of Biharin 2000.

Claiming that the present coalition government is committed to improving the sector, Singh told reporters that the government has targeted to set up new power plants in two and half years time and has started work to achieve the goal.

The minister said a global tender has already been floated for new power plant of 1320 MW capacity in Patratu.

Around 12 players have participated in the bidding, which was likely to be finalised in a fortnight time, he said adding that the new plant would be set in the existing 6500 acres land of the Patratu Thermal Power Station.

The new plant would be set at a cost of Rs 8500 crore, he said.

Besides, the government has plan to set up another plant of the same capacity in the Patratu, he said adding that the government has plans to set power plant of 1320 MW at Tenughat and Garwah.

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Source: Business Standard

Karnataka to add 1,000 MW of solar power to grid within 15 months

The State government has set a target of adding 1,000 MW of solar power to the State grid within 15 months, according to Energy Minister D.K. Shivakumar.

Tenders will be called within a week for setting up solar plants with a total capacity of 450 MW, the Minister said at a press conference, here on Thursday, convened to announce that the Federation of Karnataka Chambers of Commerce and Industry would hold Green Summit–2014 from June 5 to 7 to showcase investment opportunities in the State’s renewable energy sector.

Of the targeted 1,000-MW capacity, about 300 MW would be earmarked for farmers by encouraging them to set up small plants with a capacity of 1 to 3 MW on their farmland. In addition to this, farmers would also be given the option of forming a group and leasing out their land to solar power developers through the government for setting up “solar farms”. The government would not only protect the land ownership of such farmers, but also ensure that they get remunerative rents through cheques, he said.

In the process, the curbs on buying farmland would be lifted for those setting up solar plants, he said. Similarly, the process of converting the land-use pattern would also be simplified for solar plant developers by providing a “deemed conversion” facility for them soon after they buy the farmland for setting up solar plants, Mr. Shivakumar said.

Pointing out that the revised solar energy policy had set the stage ready for encouraging individuals and companies to set up grid-connected rooftop solar units, he said electricity supply companies (Escoms) had been told to buy power from all such rooftop solar units by paying the tariff of Rs. 7.20 a unit for those who have availed of subsidy from the Union government and Rs. 9.20 for the non-subsidised ones.

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Source: The Hindu

PV developers interviewed on sustainability of Viability Gap Funding mechanism for Phase II of India’s NSM in recent article

The first 750MW from Phase II of India’s National Solar Mission (NSM) have recently been allocated to developers using the Viability Gap Funding (VGF) mechanism for the first time, resulting in key developers questioning the sustainability of the VGF mechanism.

With over 2GW of utility scale PV already installed in India, another 750MW has recently been awarded under the government’s NSM and winning bidders have secured initial investments for their projects under the VGF scheme. Unlike the feed-in-tariff offered in Phase I, this is a scheme which provides a one-time or short-term capital assistance that bears a part of the high capital investment required in setting up a project.
The winning bidders were the ones who sought the minimum possible funds to make their projects viable. However, PV Insider’s feedback from the industry in India shows scepticism about the feasibility of the projects.  The scheme resulted in developers bidding too aggressively and too competitively to be achievable. As a result, even globally recognised developers such as SunEdison dropped out of their winning bids.

- See more at: http://news.pv-insider.com/photovoltaics/pv-developers-interviewed-sustainability-viability-gap-funding-mechanism-phase-ii-indi?utm_source=PR&utm_medium=all%20partners&utm_content=PV&utm_campaign=pr#sthash.J9N1gTlN.dpuf

KPTCL to take up works to mitigate power situation

The Karnataka  Transmission Corporation Ltd plans to take up 244 new works for around Rs 5,100 crore this year to improve the power situation in the state, Energy Minister D K Shivakumar said today.

A sum of Rs 142.47 crore had been earmarked for the purpose this year, he told reporters here. The reason for small allocation for these projects vis-a-vis the estimated cost was that ground work like the tendering process had to be completed before the projects could take off for physical implementation, he said.

“These works would be completed during the 12th Plan period,” the minister said. More emphasis had been given to 110 kV and 66 kV categories power lines as these take electricity to consumers at every nook and corner of the state and facilitates withdrawal of power from the grid, he said.

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Indian Railways to build rail connectivity to coal pitheads

Indian Railways, which gets about a third of its overall revenue from coal transportation, has fast-tracked its plan to build rail connectivity to coal bearing areas in central and eastern India by involving stakeholders like Coal India and NTPC as part-investors. These rail lines entailing a collective investment to the tune of INR 10,000 crore can potentially boost India’s coal output by a massive 300 million tonne, given that transportation bottlenecks hamper development of potentially rich coal mines in these areas.

While the new rails to pitheads will be built in Jharkhand, Chhattisgarh and Odisha, NTPC will be extending some of these lines to its upcoming power stations along the east coast.

Coal India’s output for FY14 was 462 million tonne and it accounts for 80% of India’s total production of the fuel.

According to official sources, what has lent momentum to the plan now is the Narendra Modi government assuming office. The national transporter, the sources said, has prepared a blueprint for the rail projects, including the financing options.

To put all these projects on the fast track, the Railway Board has mooted the idea of a high-level infrastructure committee that would look into the pithead and port connectivity projects.

A Railway Board official said that “Once the new minister takes charge, we’ll put forth this idea for final clearance. For us, coal is the priority sector as it gives us earnings to the tune of INR 45,000 crore annually. There’s no doubt that the new government would give top priority to coal-connectivity projects as it would be beneficial for the power sector and would slow the growth in coal imports.”

Coal India has long argued that it may have to settle for an annual output growth of just 30 million tonne over the next few years if rail connectivity to pitheads is not improved. Many potentially rich coal mines remain underutilised for lack of connectivity.

Given its unhealthy operating ratio of 90%, the railways has limited ability to increase its capital spend and hence, the innovative method of customer-funded lines to give better connectivity to industry. Almost 60% of the proposed connectivity projects will be funded by Coal India and NTPC.

Railways subsidiary Ircon International, the Chhattisgarh government and South Eastern Coalfields have recently formed a JV to develop 2 rail corridors at a cost of about INR 4,000 crore. Corridor-I or the the East Corridor will be about 180 kilometer from Bhupdevpur-Gharghoda-Dharamjaigarh up to Korba. Corridor-II or the East-West Corridor from Gevra Road to Pendra Road through Dipka, Katghora, Sindurgarh and Pasan runs 122 kilometer. Some of these projects include double-lining so that coal doesn’t get piled up at pitheads.

The Railway Board official said that “The coal stock at the pithead has come down from 75 million tonne to 57 million tonne and it will be further go down once the projects start getting operational by 2016.”

Source – www.financialexpress.com

Give public notice before revising RPO targets: Electricity tribunal to GERC

Appellate Tribunal for Electricity () has directed the Gujarat Electricity Regulatory Commission () to invite suggestions and objections of the public and stakeholders while reviewing Renewable Purchase Obligation (RPOs) of the distribution licensee companies for relaxation, carry forward or penalty.

The direction was issued by the Aptel while hearing an appeal filed by the Indian Wind Energy Association () challenging order of GERC revising RPO targets for FY 2010-11 and allowing carry forward of shortfall in procurement of renewable energy during FY 2011-12 to FY 2012-13 by distribution licensee companies. The IWEA had also sought penalty for the distribution licensee companies for non-fulfillment of RPO targets.

According to case details, GERC issued the GERC (Procurement of Energy from Renewable Sources) Regulations, 2010 specifying the RPO of the distribution licensees and other obligated entities in Gujarat. The Regulations specified the RPO separately for wind, biomass/ baggase and others and solar energy.

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