Haryana waives off intra-state wheeling charges to promote renewable energy
With a view to promote power generation from New and Renewable energy sources, Haryana government has decided to waive off intra-state “Wheeling Charges” on transmission of electricity generated from solar power plants in the state. This was announced by chief minister Manohar Lal. Wheeling Charges refers to the process of transmission of electricity from one source to another through the transmission lines or grid. The state government, under Section 108 of Electricity Act 2003, had already approved to request the Haryana Electricity Regulatory Commission (HERC) for waiving off these charges. This exemption would enable the solar energy sector to transmit power without any charge within the state. Lias Andersson Jersey
Finance Ministry Rejects Rs 20,000-Crore Plan For Local Solar Equipment Firms
The finance ministry has rejected an ambitious Rs 20,000-crore plan to prop up local solar equipment manufacturers with incentives and subsidies to help them withstand the flood of Chinese imports, said a source close to the development. The domestic industry is concerned about rising imports of solar equipment, which rose 38 per cent to Rs 21,400 crore in 2016-17, accounting for 90 per cent of the solar cells and modules used by Indian solar developers. The ministry for new and renewable energy (MNRE) began working on the policy soon after an appellate body of the World Trade Organisation (WTO) upheld a complaint made by the US against the ‘domestic content requirement’ component in India’s Jawaharlal Nehru National Solar Mission in September last year. The solar mission had a provision by which a part of India’s solar capacity target had to be met using locally made solar panels and modules, which the US maintained contravened three separate WTO agreements to which India was a signatory. The September decision was the third time the WTO had upheld the US view, with India having appealed the earlier two decisions in appropriate forums. The renewable energy ministry thus began looking for other ways to support domestic manufacturing, which would be consistent with WTO requirements. That such a policy was in the offing was confirmed by energy minister Piyush Goyal at a media briefing following a Cabinet Committee on Economic Affairs (CCEA) meeting in Februray this year. The plan, intended to help Indian solar manufacturers’ lower their costs through various subsidies and thereby enable their products to match global prices, would have cost the exchequer Rs 20,000 crore, said the source cited earlier. The MNRE did not provide any answers when asked about the progress in drafting the proposed policy. Instead, a senior official noted that there were already incentives for solar manufacturing under the Modified Special Incentive Package Scheme (M-SIPS). “Incentives are available for 44 Fe categories of electronic products and product components including solar photovoltaic equipment – polysilicon, ingots and/or wafers, cells, modules and panels,” he said in an emailed reply. “Units across the value chain starting from raw materials to assembly, testing and packaging of these categories are included.” The incentives comprise 20-25 per cent subsidy on investment in capital equipment and reimbursement of countervailing or excise duties on such equipment for units outside special economic zones. But M-SIPS is an initiative of the ministry of electronics and IT and has been in operation since 2012. The proposed solar manufacturing policy was entirely different. Domestic solar manufacturers have sought support because the local industry’s limited size makes it unable to compete on price with imported products, primarily from China. Justin Anderson Womens Jersey
Tata Power Proposes To Sell 51% Equity In Loss-Making Mundra UMPP At Re 1
Tata Power has approached Gujarat Urja Vikas Nigam (GUVNL) to buy 51 per cent equity in the 4,000 Mw Mundra Ultra Mega Power Project (UMPP) for Rs 1. Adani Power and Essar Power, which also have power projects based on imported coal, are contemplating similar moves. An official said Union Power Minister Piyush Goyal met banks and state government representatives this week to discuss power projects using imported coal and a committee had been set up to look into the fallout of a Supreme Court ruling on compensatory tariffs. “The government has clarified that it will act as a facilitator. Banks and states that are procuring power from these units will take the final decision,” an official said. The State Bank of India will lead a committee of banks to evaluate the assets. The meeting was attended by banks; Power Finance Corporation; REC; the chief secretaries of Gujarat, Punjab, Haryana, and Rajasthan; and representatives of Tata Power, Adani Power, and Essar Power. In a letter to GUVNL, also marked to the Union power secretary, the chief secretary to the Gujarat government, and the principal secretary to Prime Minister Narendra Modi, Coastal Gujarat Power (CGPL) has suggested two options: Renegotiating the power purchase agreement and selling equity. CGPL is the holding company for the Mundra UMPP. “The procurers take over 51 per cent paid-up equity shares of CGPL for a nominal value of Rs 1 and grant relief to the project by purchasing power at a rate to fully address the under-recovery of fuel costs at CGPL,” said the letter reviewed by Business Standard. The letter added: “Tata Power shall continue to operate the plant under an O&M contract and provide all required support the project as a 49 per cent stakeholder.” The Tata Sons board has questioned Tata Power why it went ahead with investments in Mundra when it knew the plant would not be viable at the cost structure available. Sources said Tata Power was also contemplating retrofitting the Mundra plant to use domestic coal to supply power to neighbouring countries such as Bangladesh. This is in line with a new coal linkage policy, which offers coal to projects based on imported coal as well. “Certain sections of investors have been informed about the possibility of having to take a full write-off on investments made in the Mundra UMPP. Lenders have expressed their dissent in wanting to fund even the working capital needs of the plant following the Supreme Court order,” said an executive. “Bankers have made a suggestion that if 51 per cent equity is taken over, the procurers will have the advantage of competitive power for the full life of the plant,” said a statement by Tata Power. Accumulated losses of CGPL are Rs 6,547 crore and its paid-up equity is Rs 6,083 crore. In a project outlay of Rs 17,900 crore, CGPL has a total outstanding long-term loan of Rs 10,159 crore and an additional Rs 4,460 crore loan taken by Tata Power to meet cash requirements of CGPL. Tata Power said the project lenders had stopped disbursal of loans beyond what was disbursed due to non-viability of the Mundra UMPP. “Due to continuous cash losses and downgrade from credit agencies, CGPL has lost its ability to arrange from financial institutions its short-term funding/working capital requirements for its day to day operations,” said the letter. The Mundra UMPP and a 1,980 Mw power plant of Adani Power at the same location, which used coal imported from Indonesia, had sought to pass on escalated coal costs due to changed regulations to the state utilities of Gujarat, Rajasthan, Maharashtra, Punjab and Haryana. On directions of Appellate Tribunal of Electricity (APTEL) and the Supreme Court, the Central Electricity Regulatory Commission (CERC) computed relief for the two firms in an order in December 2016. But the SC in April set aside the judgments of both the APTEL and CERC, hence quashing any relief. It directed the CERC to “go into the matter afresh and determine what relief should be granted to those power generators who fall within Clause 13 of the PPA as has been held by us in this judgment”. The CERC is yet to compute the relief. Joe Mixon Jersey
Gst To Make Oil And Gas Business More Expensive: Shell India CEO Nitin Prasad
Netherlands-based Royal Dutch Shell plc, the world’s second-largest oil company, has been focussing on aligning with the energy markets’ transition underway globally. India being at the heart of that transformation, the company has rolled out aggressive plans for expanding operations in natural gas and alternative fuel segments apart from the traditional fuel retailing business, Shell India CEO Nitin Prasad said in an interview with ETEnergyWorld. Edited excerpts.. Shell Global CEO Ben Van Beurden recently announced an overall investment plan of around $25 billion in 2017. What part of that investment is likely to flow to India and in which priority areas? I may not be able to share investment figures. But we are looking at an aggressive expansion in retail business and that is going to bring capital into the country. We are looking at our lubricants business which is extremely successful and we feel it will become even more successful with the BS VI transition and we are investing quite heavily in that. We are taking a look at new energies as an area. So, investing quite a bit in that space. We are also taking a look at bio-fuels and waste-to-fuel, as that technology proves itself. We are looking at next generation technologies which are being developed in our lab in Bangalore. We are looking at next generation digitisation and data management in our IT hub. We are investing heavily in that space. And, of course, we are investing tremendously in the gas space, too. Given this long list of focus areas, can you give us a perspective on the company’s thinking on HR. What is the size of the job opportunity that Shell is offering in India in years to come and in which segments? Shell in India employed around a few hundred people around ten years ago. Today, we are touching a strength of nearly 7,000 people and we will be 7,500 by the end of this year. We will be the third-largest employer in the entire Shell Group. And this is not going to stop. We will add more jobs to the country going ahead. And this includes only the direct employees. The numbers are much higher if we take into account the contract staff and the support staff. We are spending a lot of time in creating that big base of jobs. At the same time, this process is resulting in skilling India. In the entire base of 7,500 employees, there is a 10-15 per cent attrition rate. And that is an industry standard. Every year, we are bringing in 1,000 new people in our fold and also another 1,000 who are moving out. This ensures that we spend a lot of time building the skill and capacity across the organisation. A number of our competitors who are behind us in terms of setting up an R&D facility and IT Hub etc, are trying to take some of our people. Which are the key areas where most of the new workforce will go? Shell Energy India will attract people who will come and develop the gas market strategy in India. Our retail business, because of the expansion, is also going to attract additional workforce. IT will attract several hundred people. And a couple of hundred people in the Finance wing also. So, across the board, fresh induction in commercial segment will range in tens to hundreds; while IT and Finance segments will each have new people in multiple of hundred. How does GST impact the core areas of your business? GST implementation is a good thing for us in areas which are part of the GST ambit. So, it is good in lubricants, not with-standing the challenges of pace of implementation and logistics. But it is a big issue in gas and petroleum products. If I am producing gas and I am bringing in LNG today, that means that there is a whole amount of products, equipment and services that go into providing that molecule. All of that will attract GST. Who do I charge it to? I have input credits but I have no output credit because I cannot put GST onto the product. So, in effect we have made our entire business more expensive which is a problem. And also, some of the alternatives like coal are in, even as gas is out. So, it will dynamically shift the end-consumer preferences. So, there is a double whammy here. That is a big problem. What is your view on the daily fuel price change? What kind of impact do you see on retail business and consumers? I am a big fan of this move. The implications of the move going down the chain are very positive. Product prices in the global context and for Asia Pacific change daily. Similarly, gas prices change daily, rather hourly. So, when the retail prices are locked, the person at the retail end turns into a trader because he gets a forward contract at a fixed price. With daily pricing, that volatility comes all the way down to the last mile. So, the price prevailing in the market is the same price available at the pump. It is a good thing and a sophisticated concept. It opens a door of opportunity for everybody to compete on pricing. Today, it does not really make sense for all the retailers to have the same price. After all, they are competitors in a market place. They have different offers in different locations. Why should they be offering the same price? RIL and BP have just announced a major plan to jointly invest Rs 40,000 crore in KG Basin blocks apart from partnering to expand retail presence. How do you look at this announcement given that Shell is also now a major player in the upstream segment after the BG acquisition. The BG acquisition has created a lot of opportunity for us in India in the upstream segment. It was a $50-60 billion acquisition. We have brought fields under development and
Reliance Industries, Bp Withdraw Gas Price Arbitration Against Government
Reliance Industries and partner BP have withdrawn the gas price-related arbitration against the government, paving the way for the companies to claim the premium price for output from deep-sea fields in which they plan to invest Rs 40,000 crore. This is the second case of arbitration that RIL and BP have withdrawn, sending another strong signal that the relationship between the oil ministry and RIL, which had become acrimonious during the UPA regime, has normalised enough for the partners to turn their attention from litigation to investment. Last week, RIL chairman Mukesh Ambani and BP Plc CEO Bob Dudley signalled confidence in the policy environment and the regulatory regime by announcing their plan to invest $6 billion in new fields discovered long back in the deep-sea KG Basin block. “Yes. The gas price arbitration has already been withdrawn,” BP said in an emailed response to ET’s query. RIL did not respond but sources with direct knowledge of the matter told ET that the company had written last week to the government that it no more wished to pursue the gas-price arbitration. The communication came around the time Ambani and Dudley announced the new investment in the gas-rich block to produce 30-35 million cubic metres a day in three to five years. The output from these fields can fetch premium prices only if the operators have no litigation against the government, a key condition that has now been met with the withdrawal of gas price-related arbitration. Last year, the government announced a new policy that allows gas from fields in difficult terrains like deep-sea regions to be sold at almost double the price allowed for normal fields. Reliance and BP are developing new fields at a time when the cost of oilfield equipment and services have crashed while their output will begin around the time analysts expect the global gas glut to end. Equipment prices have crashed due to low demand because the fall of crude from about $115 to below $50 have prompted oil firms to stop exploration and development in deep-sea regions, which need a higher price to justify the investment. Three years ago, RIL, which owns 60% participating interest in the KG block with BP owning 30%, invoked an arbitration following the government’s refusal to implement a price formula for domestic gas that could have doubled the prevailing price. The government challenged Reliance’s power to invoke arbitration in the Supreme Court, arguing that the government alone enjoyed discretion on which price policy it should implement and a company can’t force it to apply a certain policy. The case has dragged on for three years with no consequence as yet. Last year, Reliance Industries, which is engaged in a string of arbitration cases against the government, dropped another arbitration in which it had contested the government’s 2013 order to relinquish about 80% of the KG-D6 area. There are four more arbitration cases between RIL and the government. These are over disallowance of cost-recovery in its KG-D6 block, amount the company must pay for unfinished minimum work programme and illegal production of gas from ONGC’s fields in the KG basin. Another dispute related to Panna-Mukta, Tapti fields has received arbitration award but the parties are still seeking more clarity on it. Pedro Martinez Jersey
MoU Between NTPC And MOP For 2017-18
Memorandum of Understanding (MoU) for the year 2017-18 between NTPC and Ministry of Power, Govt of India was signed on 20th June, 2017. As per the MOU, NTPC has generation target of 250 Billion Units during the year under “Excellent” category. Revenue target from Operations under “Excellent” category is Rs 79,280 Crore. In addition to above, parameters related to financial performance, operational efficiency, CAPEX, projects monitoring and HR Management are also part of MoU in line with guidelines of Department of Public Enterprises. NTPC is the largest power utility company in India with a total installed capacity of 51,635 MW. Company has presence in Coal , Gas , Solar PV, Hydro and Wind Power Generation and Coal Mining. Tyrod Taylor Jersey
IOC, BPC and HPC sign joint venture agreement for West Coast Refinery Project
India’s emergence as a global refining hub received a big boost with the three downstream PSU oil majors, Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, joining hands to build one of the world’s largest integrated Refinery-cum-Petrochemicals complexes in Ratnagiri district of Maharashtra. The joint venture agreement for the West Coast Refinery Project was signed here today in the presence of Mr. Dharmendra Pradhan, Minister of State (Independent Charge), Petroleum & Natural Gas; and Mr. KD Tripathi, Secretary, Petroleum; by Mr. Sanjiv Singh, Chairman, IndianOil; Mr. D Rajkumar, CMD, Bharat Petroleum; and Mr. MK Surana, Chairman, Hindustan Petroleum. The 60 million metric tonnes per annum (MMTPA) west coast refinery-cum-petrochemicals complex will be a state-of-the-art unit built at an estimated cost of US$ 40 Billion, and is expected to be commissioned by the year 2022. It will be a green refinery comprising 50 units designed to operate at the highest level of efficiency, and will be self-sufficient in power and utilities requirements, besides creating a benchmark in environment management. Designed to produce Euro-VI and above grade transportation fuels, the refinery will have in-built flexibility for processing a wide spectrum of light and heavy crude oil grades, utilising various blending techniques. It will also be able to produce on-demand product mix of petrol and diesel streams, as well as other refined products and petrochemical streams with the highest level of integration and energy efficiency. The preliminary configuration study of the project is being carried out by M/s. Engineers India Ltd. in association with an international consultant. M/s. IHS has been entrusted with the market study for the chemicals and petrochemicals to be produced at the complex. The project will be embedded with social responsibility initiatives and a skill development centre, and a smart township with best-in-class services is also being planned. Apart from the main refinery-cum-petrochemicals complex, the viability of other associated industries in the vicinity of the project is also being examined so that all stakeholders can be involved in the mega project. Jacob de la Rose Authentic Jersey
How history will come full circle if Tatas buy Air India
If Tata Group buys a controlling stake in beleaguered national carrier Air India, as indicated by an ET Now report, the history will come full circle. The airline will go back to a group which had built and nurtured it into one of the world’s finest airlines until grasping and sloppy governments run it into the ground. The Tata’s purchase will also tell the cautionary tale of how unbridled socialism that thrived on rampant corruption stymied private enterprise in India. It will underline a lesson India has learnt the hard way—the government has no business to be in business. Tata Sons set up Tata Airlines in 1932. JRD Tata, the legendary entrepreneur, himself flew the first flight between Karachi and Mumbai. In 1946, Tata Airlines became a public company and was renamed Air India. In 1953, when the government nationalised Air India “through the back door”, as Tata himself put it, it was one of the best airlines in the world. A dream enterprise of Tata, he had built it bit by bit with personal care, down to the menu and curtains. Tata was devastated when he came to know about the decision of then prime minister Jawaharlal Nehru, a Fabian socialist averse to private enterprise. Tata wrote to Nehru: “I can only deplore that so vital a step should have been taken without giving us a proper hearing.” “Even more than the decision itself, I was upset by the manner in which nationalisation was introduced through the back door without any prior consultation of any kind with the industry,” Tata wrote to a company executive about the nationalisation of his dream project. “However, we have to reconcile ourselves to the fact that we are living in a political and bureaucratic age in which people like ourselves no longer count for much in the scheme of things.” Yet, Tata accepted to become the nationalised airline’s chairman when Nehru insisted. Air India kept on doing well under him till he was removed in 1977 by then prime minister Morarji Desai. What Nehru once told Tata came to be prophetic for a large number of public sector units (PSUs)—especially Air India. During a conversation, Nehru rebuked Tata, telling him he hated the mention of the word “profit”. When Tata pointed out he was talking about the need of PSUs to make a profit, Nehru said, “Never talk to me about the word profit; it is a dirty word.” Living up to Nehru’s sentiment, Air India today reels under a debt of about Rs 50,000 crore and has never made a profit in a decade, despite eating up Rs 24,000 crore of a government bailout package. Even Tatas are concerned now over its huge debt. While there is no certainty if Tatas can turn Air India around if they decide to buy a controlling stake, the purchase will certainly write the concluding chapter of India’s socialist economic experiment—how an ideology kept pulling back a country where business runs in people’s blood. Jerry Hughes Jersey
C’garh Govt approves new Solar Energy Policy
In a bid to promote production and usage of non-conventional energy in the State, Chhattisgarh Cabinet has on Tuesday approved Solar Energy Policy- 2017-2027 that will be effective till March 31, 2027. The new Solar Energy Policy- 2017-2027 was approved by the State Cabinet at its meeting chaired by Chief Minister Dr Raman Singh at Mantralaya, Agriculture Minister Brijmohan Agrawal told media persons. There have been several technical upgradation in the sector of solar energy and drastic reduction in the investments in solar energy sector. The State Government felt the need to make amends in the solar energy -based sector keeping in mind the huge investments likely in the next few years. According to this policy, any individual, registered person, Central and State Power Production and Distribution companies, public and private sector solar energy project developers and manufacturers of equipments related to this sector, allied sectors are stake-holders and partners. Grid Connectivity facility will be provided up to 10 kilowatt rooftop and solar power plant under this policy. There will be exemptions in electricity charges on the consumption of power by self or inside the State on captive power plants. The exemptions are granted to the solar energy-based plants till March 2027 under the new Solar Energy Policy. Facilities will be provided as usual to non-conventional electricity plants. Chhattisgarh State Store Purchase Rule 2002 of Department of Commerce and Industries Chhattisgarh was amended and approved by the State Cabinet. The amendment was done to make use of GeM (Government e-Market Place) of the Union Government’s DG S and D. The amendment was carried out to felicitate the State Government departments, public enterprises, mandals and janpad panchayats and civic bodies to purchase electronic equipment. The Department of Electronics and Information Technology, Government of Chhattisgarh will fix the policies and prices in case of need. Sam Bradford Jersey
IEX eyes new geographic market, strategic investments & alliances with global power exchanges
The IO-bound Indian Energy Exchange (IEX), which is currently involved in the day ahead market (DAM), the term ahead market (TAM) and renewable energy certificates, has drawn up an expansion strategy. It includes entering into new geographic market, strategic investments in and alliances with international power exchanges and develop new products and services in India. In the draft papers with the Securities and Exchange Board of India (Sebi), IEX said it is in the process of developing products for trading in renewable energy contracts such as the ‘green day-ahead market’ consistent with the government’s focus on renewable energy. IEX also plans to initially offer TAM products in Bhutan, Bangladesh and Nepal which are connected at one ore more points with the Indian power grid. IEX managing director and CEO Satyanarayan Goel declined to offer any comment. However, the power exchange in its filing hoped, “The listing of the equity shares will enhance our company’s brand and provide liquidity to the existing shareholders. Our company expects that the proposed listing will also provide a public market for the equity shares in India.” IEX will engage the relevant regulators in India and in neighboring countries to develop collaboration opportunities with the local power grid companies so as to allow participants from these countries to trade on our Exchange. This is aimed to expand into such new geographic markets to increase customer base and also enhance the liquidity of electricity products available on its platform. ”In the longer term, we also intend to explore and pursue strategic investments in and alliances with international power exchanges that will enable us to supplement our internal growth, expand our trading products and related services, advance our technology and take advantage of experience and new developments in international energy markets,”IEX informed. Further, the power exchange plans to increase the number of new participants to help increase revenue but also increase the liquidity of electricity products which will encourage increased trading activity from the existing participants. IEX is in the midst of offering a computer-to-computer link to its trading platform so as to allow members to individually develop their own software which would, in turn, allow their own clients to directly access the trading platform of power exchange. POWER PLANS It plans to offer TAM products in Bhutan, Bangladesh, Nepal, connected at one or more points with Indian power grid The power exchange plans to increase the number of new participants to help increase revenue Rajon Rondo Womens Jersey