Power demand blackout sparks spot price meltdown
IndianPowerSector.com
April 11th, 2014
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A historic slump in power demand from bankrupt distribution utilities has dragged down spot prices at India’s largest power exchange, India Energy Exchange (IEX), to the lowest ever in its seven-year history. Average prices crashed to Rs 2.80 per unit last financial year — lower than even the average tariff of Rs 2.92 per unit at which the country’s largest and cheapest power producer NTPC Ltd supplies electricity under long-term PPAs (power purchase agreements).
The trend raises a key question: Will discoms renege on purchase commitments from NTPC? PPA terms allow discoms to curtail the committed quantum of power but they have to pay at least the fixed charges.
According to the latest market data sourced from IEX and Central Electricity Regulatory Commission (CERC), volume of power traded on the exchanges has grown from 2.6 billion units (BUs) in 2008-09 to 29 BUs last fiscal.
However, prices have declined sharply from Rs
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Govt receives 36 applications for three coal mines
SUMIT KUMAR
April 11th, 2014
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The government has so far received 36 applications from companies, including Jindal Steel and Power Ltd (JSPL) and Tata Steel Ltd, in response to a notice inviting applications for allotment of three coal blocks on tariff-based bidding.
“So far the coal ministry has received 36 applications from companies like JSPL and Tata Steel,” a person familiar with the matter said, adding that the bids are invited by the government till May. “The entire process, including evaluation of applications and shortlisting the firms among others before the coal blocks are allotted, will take at least four months,” the person said. The government had in February put three mines in Jharkhand and West Bengal for auction for captive use. The much-delayed auction features mines that have total reserves of 500 million tonnes (mt).
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Finance ministry steps in to rescue Dabhol power project
SUMIT KUMAR
April 11th, 2014
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The finance ministry has stepped in to rescue the Dabhol Power Project, which is struggling to collect Rs 400 crore dues from Maharashtra's power utility. The ministry says it would deduct the amount from central funds to be transferred to the state if the dispute is not resolved amicably.
The project, which was built by Enron Corp, has been in trouble since last year, when dwindling gas supply from Reliance Industries' KG-D6 block forced it to shut down.
It owes Rs 8,500 crore to lenders and is struggling to keep afloat. It is controlled by Gail IndiaBSE -1.20 % and NTPCBSE -0.57 %, which have 32.86% apiece while Maharashtra government owns 17.41% and its lenders together own 16.87%.
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Power Projects Left in the Lurch for Want of Natural Gas
SUMIT KUMAR
April 10th, 2014
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It looks like the fate of the proposed Natural Gas (NG)-fuelled mega power projects of the Kerala State Electricity Board (KSEB) in the state solely depends on the pricing of the fuel. Though many of the projects are coming up in Ernakulam district the final decision is yet to be taken by the Board.
“The future of liquefied natural gas (LNG) power plants in the state depends on the availability of domestic gas and the cooling off of imported LNG prices. A final decision could only be taken after considering these factors,” KSEB authorities stated in an RTI query about the present status of the NG power projects in the state.
The proposed mega power plants using LNG as fuel in the
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Policy concerns force GE to shift focus from India to Bangladesh
SUMIT KUMAR
April 10th, 2014
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In a reflection of foreign firms shifting their focus from India to elsewhere because of domestic hurdles, General Electric Co. (GE) is concentrating on Bangladesh for its power generation business, attracted by the country’s fast decision-making, said Banmali Agrawala, president and chief executive for GE South Asia.
With power projects of an aggregate capacity of 9,322.5MW being stranded in India in the absence of gas, gas-rich Bangladesh has emerged as the destination of choice for GE for its power business.
“In our region we have Bangladesh where we continue to do business. They have gas and let me be tongue in cheek and say that they take decisions. From the power generation perspective, at the moment there is more activity we
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