Subsidy extension unlikely for stranded and under-utilized gas-based power plants
The government is unlikely to extend the subsidy support scheme for stranded and under-utilised gas-based power stations. The scheme is due to end next month. The power ministry is of the view that a long-term solution should evolve for bailing out the 24,000 MW gas-based power stations languishing for want of fuel, sources in the know of the development said. Senior officials in the ministry of power declined to comment on the issue. Power companies have asked the government to extend the scheme for another two years. “We have been requesting to continue with this scheme as a short-term solution till a longterm solution can be evolved for making gas-based generation viable,” said Ashok Khuarana, director general at Association of Power Producers. “This present scheme helps stem interest accrual, thereby keeping capital cost under control. Non-extension of the scheme would result in continued accrual of interest, which may make it difficult to turn around the projects subsequently.” The power ministry held two rounds of imported gas auction starting from June 2015 to September 2015 and from October 2015 to May 2016. The bidders indicate the total incremental electricity they would generate using the e-bid regassified liquid natural gas (RLNG) as well as quote subsidy requirement. In the last round of auction held in March 2016, the bidders agreed to forego subsidy. Association of Power Producers has recommended continuation of the scheme to the ministry, arguing that it would be at zero cost for the government as subsidy determined in the third round was negative. The Union Cabinet in March 2015 approved the mechanism for importing gas for stranded and underutilised power plants, and supply of such electricity through a support. It was decided that to make gas affordable, states will forego taxes while gas transporters and import terminals will also offer discounts on charges for their services rendered to import LNG for this purpose. The Centre allocated `7,500 from the Power System Development Fund to support the scheme to help plants use 30-35% of their capacity and repay debt. The scheme was started in 2015-16 for stranded gasbased power plants and plants receiving inadequate domestic gas. The stranded plants were able to meet partial debt service obligations due to the scheme as they operated at low plant load factors of 30%-50%. However, of late, state distribution companies are averse to buying the gas-based generation as low cost power is available from renewable plants and spot markets. Steven Stamkos Authentic Jersey
Wind power installations may cross 5,000 MW this year
Sarvesh Kumark, Chairman of Indian Wind Turbine Manufacturers’ Association, is confident that wind power installations in India will cross the 5,000-MW-mark. The previous high was 3,472 MW of fresh capacity set up in 2015-16. The Association’s General Secretary, D V Giri, is a shade less optimistic. While 5,000 MW is not impossible, he says, upwards of 4,500 MW is certain. Year-end installations 5, 000 MW is a heady number — just two years back the sector struggled to achieve half of it. In the first ten months of the financial year, till January, the sector added 2,094 MW, which means close to 3 GW would need to be put up in just two months. However, a rush of activity towards the end of the year is not uncommon, as power producers hurry to finish the projects by March, so that they could avail themselves of the depreciation benefits and also be ready for the peak winds of summer. In 2015-16 installations of 3,472 MW, as much as 1,700 MW came in March alone. Further, the ‘generation-based incentive’ scheme, under which the government gives 50 paise a kWhr of electricity generated by wind turbines, expires this March. Year-end installations will therefore peak, as developers rush to meet the March deadline. This year, the highest installations are likely to come from Andhra Pradesh, around 2,500 MW, Sarvesh Kumar said. Gujarat (around 1,000 MW) and Karnataka (700 MW) were the bigger markets this year. Industry insiders feel that 2017-18 will be good too. One reason is that an additional demand for 1,000 MW will come from the ‘competitive bidding’ process that is under way, through which some developers will win mandates to sell wind power to the government-owned Solar Energy Corporation of India. At the end of January, India had 28,871 MW of wind capacity. It ranks fourth in the world after China (145,362 MW), US (74,470 MW) and Germany (44,947 MW). The government aims to see 60,000 MW by 2022. Hyun-Jin Ryu Womens Jersey
The historically low solar tariffs at Rewa
Solar energy has become the cheapest it has ever been in India, thanks to historically low tariffs achieved in the reverse auction bid for three units in the Rewa plant in Madhya Pradesh earlier this month. But what does this mean for the solar industry in India? What exactly happened? The two-day reverse auction bid for three 250 MW blocks in the Rewa solar plant in Madhya yielded a tariff of Rs 2.97 for each of the blocks and a levelised tariff of Rs 3.3 over the course of the 25-year power purchase agreement. The winners of each of the bids were Mahindra Renewables, ACME, and Solenberg Power. The Rewa plant is a joint venture of Solar Energy Corporation of India and Madhya Pradesh Urja Vikas Nigam (MPUVN). A reverse auction in such a scenario is basically a situation where companies bid for a unit by offering the lowest tariffs at which they will sell the energy generated from the unit. The lowest tariff wins the bid. How were such low rates achieved? Companies bidding for the Rewa units were able to commit to such low tariffs because of various factors, some to do with the industry, and others to do with the specific bid. The industry-related factors include the fact that solar energy producers in India have been able to greatly reduce their costs due to the import of cheap photovoltaic panels from China. In addition, in keeping with the government’s renewable energy push, especially its commitment to achieve 100 GW of solar energy by 2022, it has expedited the land acquisition process and has reduced excise duties on various components required to set up a solar plant. Specific to the Rewa bid, the Madhya Pradesh government implemented a few favourable and unique structures in the project power purchase agreements. For example, it included a state government guarantee for the contracted capacity by the utility as well as a compensation for deemed generation in case of non-availability of grid. These factors allowed the bidders to commit to lower tariffs than they would otherwise have been able to. What does this mean? While this does mean that solar energy will be cheaper, several industry experts have warned that, at such low tariffs, margins are also very slim. This could mean that even a slight increase in input prices—such as pricier imports from China—could push many of these projects into unprofitability. Jihad Ward Authentic Jersey
Government mulls 50 percent subsidy on solar powered cold storage facilities
To facilitate farmers store their horticulture produce for longer period, the Telangana government is considering provision of 50 % subsidy on ‘solar powered cold storage’ with the help of Central government assistance under MIDH (Mission for Integrated Development of Horticulture). According to officials, as part of its pilot project to help farmers store their horticulture produce including fruits and vegetables for selling it next day, the Horticulture Department has requested the Central government to allocate an amount of Rs 75.5 crore for 1000 units for the year 2017-18 under MIDH component special interventions in Post Harvest Management. Each unit will cost Rs 12 lakh. If the government assistance in the form of subsidy is available the burden will be reduced to half. “Mostly, small and marginal farmers cultivate horticulture crops in the State. But due to lack of facilities to store the produce and also to increase shelf life in different climatic conditions, about 30 percent of the produce is becoming stale each year. Because of this most of the farmers are not getting better prices, while on the other hand even the consumers failed to get fresh produce,” informed a high official of Horticulture Department. Telangana is the second largest producer of fruits and vegetables with 6.734 lakh hectares under different horticulture crops. The total production of horticulture crops is 81.65 lakh metric tonnes. Of this, fruits are grown in an area of 3.235 lakh hectares and vegetables on 1.718 lakh hectares with a yield of 41.97 lakh metric tonnes and 31.95 lakh metric tonnes respectively. The Solar power cold storage also called as ‘Portable Solar Micro Cold Room’ has been developed by a group of young IITians of Kharagpur under the brand name ‘Ecofrost’. The facility which is totally operated on solar energy has a storage capacity of 5 metric tonnes capacity. The official informed that the eco-friendly model has pre-cooler as well as cold storage components with a power back up of about 30 hours. Interestingly, it runs without any batteries and only with the help of solar panels. “What the IITians have developed is an innovation of its own in the entire Asia, state adopts it, we would be the first in availing this kind of technology for horticulture,” added the official. Agriculture Minister, Pocharam Srinivas who had recently launched the Portable Solar Micro Cold Room at Center of Excellence at Jeedimetla in Hyderabad, described this latest adoption of technology by some private firms in the State as a boon for the farmers. The Minister felt that the anxiety levels of farmers who fear rotting of their produce can now store it for longer period and avoid panic selling. Fozzy Whittaker Jersey
Direct Benefit Transfer leads to Rs 50,000-crore savings for government in 3 years
Savings due to Direct Benefit Transfer (DBT) over the last three years have touched Rs 50,000 cr as on December 31, 2016, as per latest government figures. This amount is equivalent to the subsidy paid out under DBT in this financial year, implying nearly a year’s subsidy was saved. “The savings figure is expected to significantly rise further in the next financial year as the government will be bringing a total of 533 central payout schemes in 64 ministries under the DBT mechanism by March 31, 2018 as per the directions of PM Narendra Modi,” a top government official told ET. Presently, 84 schemes in 17 ministries are covered under the DBT, up from 34 schemes as on March 31, 2015. “Under UPA, the talk was only about big scams and several lakh crore rupees of losses. There is no scam now…instead we have saved nearly Rs 50,000 cr by crediting the subsidy amounts directly in the bank accounts of the correct beneficiaries and eliminating ghost beneficiaries,” the top official added. Nearly 33 crore people receive various subsidies directly in their bank accounts now through DBT. As per government’s interim figures as on December 31, the cumulative DBT savings stand at Rs 49,650 cr, pending information from many states. The top government official pitted this figure against the one of Rs 48,860 cr of subsidy transferred through DBT in this financial year till December 31, 2016. The total DBT payout since 2014 till date has been Rs 1.6 lakh cr. “This implies that nearly one year of total subsidy payout has been saved by the government through DBT,” the official said. Though the DBT mechanism started in 2013 under the UPA on a pilot basis, it took off in a major way only under Modi government after the LPG subsidy scheme (Pahal) was commenced through the DBT mechanism in November 2014. “We saved Rs 15,192 cr in 2014-15, Rs 20,951 cr in 2015-16 and nearly Rs 14,000 Cr in 2016-17 till December 31, 2016 through DBT,” the official said. The government says it has saved almost Rs 14,000 cr in its Public Distribution Scheme (PDS) by deleting 2.33 cr ration cards so far and better targeting of beneficiaries through DBT. Rs 7,633 cr is cited as the savings in the MGNREGS scheme by the government so far. Rs 399 cr is cited as savings in the National Social Assistance Programme. The biggest saving of Rs 26,408 cr is cited in the LPG PAHAL scheme, including Rs 4,824 Cr in the first nine months of this financial year. The LPG subsidy payout qualifies as the world’s largest cash transfer programme, Centre claims. The government is sticking to its guns on the LPG subsidy savings figure despite the Comptroller and Auditor General of India (C&AG) poking holes in the same in a recent report saying the savings were “exaggerated”. C&AG said the government had assumed that the 3.11 cr blocked or inactive customers would have availed 12 subsidised cylinders apiece rather than only 6 cylinders as per national average per capita consumption of cylinders. The major schemes new on DBT platform over the next one year will include Pradhan Mantri Ujjwala Yojana, Atal Pension Yojana, PM Suraksha Bima Yojana and PM Jeevan Jyoti Bima Yojana, PM Crop Insurance Scheme and PM Gramin Awas Yojana. Justin Braun Womens Jersey
Iran finds 2 billion barrels shale oil reserves in western province – agency
Iran has found shale oil reserves of 2 billion barrels of light crude in its western Lorestan province, a senior official at the state-run National Iranian Oil Company (NIOC) was quoted as saying. “Based on studies, it is estimated that the shale oil reserves in Ghali Koh in Lorestan amount to 2 billion barrels of oil in place,” Bahman Soleimani, NIOC’s deputy director for exploration, told the semi-official news agency Tasnim. “The oil is light.” Soleimani said exploration was also being carried out for shale gas reserves in the area, and the studies were expected to be completed by October, 2017. Iran’s proven oil reserves of about 160 billion barrels, almost 10 percent of the world’s total, rank it fourth among petroleum-rich countries. John Jaso Womens Jersey
Trump effect on world energy will benefit India
Energy demand in the US and the West will remain flat because of increased energy efficiency. The United States, India, and the world are waiting to see what President Donald Trump’s words “only America first”, “buy American, hire American” and “protection” to “make America great again” mean in practice. What Trump means for the world’s energy policy and US-India cooperation on energy is particularly important. Energy is deeply entwined with the fundamental issues of international security, economic development, human health, climate change, and a whole host of subsidiary issues. A wise man once said, “Where a door is closed, a window is opened.” This metaphor is applicable to energy policy under Trump and what it means for India and the world. For example, Trump’s overwhelming emphasis on fossil fuels may be closing the door of US leadership on climate change and environmental protection. However, Trump’s stepping back on environmental effects of energy gives India the opportunity to play a pre-eminent world leadership role on this issue. Paradoxically, the Trump emphasis on fossil fuels, along with nuclear and hydro, also presents an opportunity for US-India cooperation on environmentally responsible energy security across the board. US energy policy is like a great ocean liner. It cannot be turned quickly and is subject to forces that are not within the control of the ship’s captain—even if that captain is Donald Trump. In the United States particularly, these forces include supply and demand as expressed through the market and free enterprise. Against this background, here is what the Trump effect will and will not mean for world energy policy. First, no change by the Trump Administration will alter the increasing demand for energy in the non-OECD countries of Asia, mainly India and China, as the main driver of world energy policy. According to the International Energy Agency, India’s energy demand will grow more than any other country’s from now to 2040. This demand must be accommodated. On the other hand, energy demand in the US and the West will remain relatively flat—not for lack of growth, but primarily because of increased energy efficiency. This shows that India and the world must view efficiency as a fuel and that a mutually beneficial system for moving energy technology and sources to India is highly desirable. Second, oil and gas are now in the US energy driver’s seat. Trump has appointed a plethora of men associated with oil and gas production to top posts. In a phrase made famous by Sarah Palin, former governor of Alaska and Vice-Presidential candidate, “drill, baby, drill” is winning out. The US is already the largest producer of oil and gas in the world, and under Trump such production will only become larger. The US was already projected to be energy independent by as early as 2018—meaning that it will be exporting more energy than it imports. The Trump Administration is likely to favour many international measures that increase the international exploitation of oil and gas. The Administration has already signalled approval of the Keystone pipeline that will bring oil from Canada through steel pipes made in America. There will be rapid permitting of LNG export projects that should benefit India. Third, Trump will decrease environmental regulations promoting renewables and will probably withdraw the US from the Paris Agreement. Trump Cabinet nominees acknowledged in their confirmation hearings that humans are contributing to climate change. However, they consider the degree of contribution and what to do about it as open questions. On the campaign trail, Trump said he would “cancel” the Paris climate change agreement. Later he said he had an “open mind” on the subject. However, Trump will certainly retract the Obama Clean Power Plan. This plan is the main mechanism for the United States meeting its commitments to lower its CO² emissions by 26%-28% of 2005 level by 2025. There is also a pledge of the developed nations to mobilise $100 billion a year by 2020 to fight climate change. The Trump administration is unlikely to see this as a priority. Thus, withdrawal seems likely. Fourth, in spite of Trump policies, natural gas and renewables will continue to replace coal in the US and world energy mix. India should capitalise on this trend. Trump loves coal. His attacks on Obama’s supposed “war on coal” were instrumental in his victory in several key states. While Trump has promised to bring back coal, the continued emphasis on gas fracking and technological developments in horizontal drilling are working against the resurrection of coal. With the rise of LNG, the phenomenon of natural gas competing with coal is becoming worldwide. This phenomenon is being driven by both price and the superior performance of gas from an environmental perspective. Solar and wind are precipitously dropping in price and have obvious environmental advantages. The shift to renewables backed by natural gas will continue regardless of Trump’s preferences. Under Prime Minister Narendra Modi, India has already taken a strong position on renewables. India’s leadership of the International Solar Alliance is but one example. Trump’s scepticism about renewables will provide further scope for India to assume leadership on solar and wind. In regard to nuclear and hydro, Trump seems to favour these as well as fossil fuels. Thus, India may find it easier to cooperate with the US in making all sources of energy more efficient and environmentally responsible. Thus, there is good news and bad news about the Trump effect on world energy policy. The good news is that it offers the opportunity for closer cooperation with India and most other nations on sources of energy across the board. The bad news is that the emphasis on the exploitation of fossil fuels may overwhelm US leadership on energy and the environment. The threats of air pollution and climate change to the people of the world are real. The last three years have each been the hottest years on record. The health of hundreds of millions in India and around the world is being severely harmed by air
India’s Top Refiner Said to Review $8 Billion Spend on Tax Shock
Indian Oil Corp., the nation’s top refiner, is reconsidering plans to invest $8 billion in the country’s east after a provincial government threatened to withdraw promised tax breaks, people with knowledge of the matter said. The government of Odisha state said in a letter to the company that it was no longer keen to provide a deferral of value added tax on the sale of petroleum products, the people said, asking not to be identified because the information isn’t public. The benefit was initially extended as an incentive to build the Paradip refinery in the state and ending it would hit profitability and impact future investments, they added. The 11-year tax deferral was for products from the refinery sold in the state. Indian Oil has plans to invest 520 billion rupees ($7.8 billion) in Paradip to expand the refinery, upgrade it to produce a superior quality of fuels and add downstream petrochemical units along with pipelines and storage facilities. The offer of the tax break on sales of petroleum products prompted Indian Oil to spend 346 billion rupees to build a 15 million metric tons a year refinery in Odisha. Work on the Paradip refinery began in 2004 and the plant is operating at 80 percent of capacity in the current financial year. Indian Oil is also an investor in the proposed 60 billion rupee liquefied natural gas importing terminal at Dhamra in the state. Indian Oil is in talks with the state government and is hopeful, a company spokeswoman said. The Odisha chief minister’s public relations officer Sukanta Kumar Panda did not respond to phone calls and an e-mail seeking comment. The refiner has chalked out plans to spend 1.84 trillion rupees through 2022 to expand its refining, pipelines and distribution infrastructure. The state-run refiner will add annual capacity of 24 million tons to its existing refineries over the next six years, Chairman B. Ashok said last year. Caleb Sturgis Authentic Jersey
Major Petroleum Theft Detected on Mathura-Jalandhar Pipeline
Jalandhar Pipeline where oil mafia had virtually installed a parallel filling station by constructing a big tunnel for operation. The breach on the pipeline was detected after about three months in R K Puram colony under Highway police station. “Though the theft was suspected in the month of November, 2016, as drop in pressure of fuel in the pipeline was observed by ‘leak detection system’ however it could not be found in spite of repeated surface monitoring as theft was not massive,” said Virendra Kumar, pipeline manager, Telecom and Instrumentation. It came to surface when more drop in pressure was detected recently,” he said adding that theft this time has been committed in a planned way where all the three systems – survey, activation and operation appear to have been adopted,” he said. SP City Ashok Kumar when contacted said the act is daring, planned and a challenge for police however, police is committed to nab the real culprits. He disclosed that prima facie hunt is on for two persons whose names have come up. According to the FIR filed on Saturday, the tunnel (15 feet deep and about 100 meters long) on the outskirts of R K Puram colony was found when concentrated surface monitoring was conducted following a report of massive leakage through leak detection system. A tanker was being filled from the pipeline when police and refinery officials reached the spot but not before the oil mafia gang managed to escape. A valve for taking out the fuel was attached to the pipeline and the tunnel was fully electrified with provision for fresh air through pipes, the police report stated. Police disclosed that JCB machine was used for unearthing the tunnel and the entire system. “The culprits this time would not go scot-free,” Police Circle Officer Anupam Singh said when asked about the case since so far over half dozen incidents of fuel theft on the pipeline have taken place but none have been solved. Kyle Korver Jersey
Natural gas price in India likely to be hiked by 8 per cent by April
Natural gas price in India is likely to be hiked by 8 per cent from April 1 driven by an increase in rates in reference markets including US Henry Hub. Price of natural gas, used for generating power and making fertiliser and petrochemicals as well as CNG for automobiles, is likely to rise to USD 2.7 per million British thermal unit for the period from April 1, 2017 to Sept. to September 30, 2017 from current USD 2.5 per mmBtu, industry sources said. This will be the first increase in domestic gas prices in two years. Rates may further rise to USD 3.1 per mmBtu in second half of 2017-18 fiscal (April to March). As per the mechanism approved in October 2014, the price of domestically produced natural gas is to be revised every six months — April 1 and October 1 — using weighted average or rates prevalent in gas-surplus economies at Henry Hub of US, National Balancing Point of the UK, rates in Alberta (Canada) and Russia with a lag of one quarter. So, the rates for April 1, 2017 to September 30, 2017 period will be based on average price at the international hubs during January 1, 2016 to December 31, 2016. Sources said prices in the reference markets for 2016 are known and so the rates in first half of fiscal year beginning April 1 can be calculated. Rates were last changed on October 1, 2016 when they were cut by 18 per cent to USD 2.5 per mmBtu from USD 3.06. This was the fourth six-monthly reduction. John Tavares Authentic Jersey