European Union: Renewables made up 16.7 per cent of energy mix in 2015
European Union statistics show that renewable sources accounted for 16.7 percent of the bloc’s energy consumption in 2015, nearly double the share a decade earlier. EU statistics agency Eurostat said Tuesday that renewable energies’ slice of the cake was up from 16.1 percent in 2014. In 2004, the first year for which data are available, the figure was only 8.5 percent. The EU’s target is to reach 20 percent across the bloc by 2020. Eurostat said that 11 of the 28 EU countries have already reached their own national targets for 2020. In 2015 Sweden had by far the biggest share of renewable energy, which accounted for 53.9 percent of its total consumption. Luxembourg and Malta had the smallest share, with only 5 percent each. Ryan Anderson Womens Jersey
3 CIL subsidiaries slash valuations by at least 75%
Boards of three subsidiaries of state-run Coal India Limited have slashed valuations of the shares of these companies by at least 75% over the values declared earlier this month. The earlier valuations, according to the merchant banker of the listed monopoly miner, did not reflect the true valuation of either the subsidiaries or the parent. But even as the valuations have been reduced, the amount of money that Coal India will receive post reduced valuation through proposed share buybacks remains the same at Rs 5,063 crore. In fresh announcements of buyback post revaluation, the number of shares to be bought back has been increased to keep the total sum the same. Four of Coal India’s eight subsidiaries, including Central Coalfields, had announced share buy-backs last month. As part of the exercise, the boards of these companies had valued their shares. The earlier valuations included factors that are considered for valuing international companies, resulting in higher valuations, said a Coal India executive, who did not wish to be identified. Later it was realised that some of these factors may not be relevant for Indian coal companies, he said. A fresh valuation exercise was thus conducted, leaving out factors that were irrelevant for India. This resulted in reduced valuations for three subsidiaries –Northern Coalfields, Mahanadi Coalfields and South Eastern Coalfields. “Since these subsidiaries are not listed, there was no market driven share valuation available for these companies and the merchant banker had to resort to theoretical norms to ascertain their value,” the executive said. Initially, shares of Northern Coalfields were valued at Rs 1.629 lakh per share of face value Rs 1,000 each. The valuation has been reduced 81% to Rs 30,260 per share. Shares of Mahanadi Coalfields were initially valued at Rs 2.922 lakh per share of face value of Rs 1,000. This has been revised to Rs 35,796 per share. Similarly, shares of South Eastern Coalfields were earlier valued at Rs 79,777 per share, but have been subsequently revalued at Rs 19,599 per share. While shares of the three subsidiaries are now valued between Rs 19,599 and Rs 30,260 per share, shares of its parent, Coal India, were offered at Rs 225-245 per share in 2011. The stock opened at Rs 288 on the Bombay Stock Exchange and reached an all-time high of Rs 440 in 2015. On Tuesday it was quoting at Rs 295 at the Bombay Stock Exchange. “While Coal India’s equity base is almost 620 crore, with each share having a face value of Rs 10, the shares of subsidiaries hold a face value of Rs 1,000 each, and the total number of shares for each of these subsidiaries is a few lakh only, resulting in many times higher valuation for each share than the parent’s,” the executive said. Shea Weber Womens Jersey
Coal supplies to power plants to depend on PPAs
Power companies that win coal contracts with the Coal IndiaBSE -0.03 % Ltd (CIL) in the forthcoming auctions will have to ensure that they sign long and medium-term contracts for power supply with discoms within two years. Coal supplies to the power plants will start only after they sign the power contracts. The Cabinet Committee on Economic Affairs (CCEA) is likely to consider the new coal contracts policy for power plants in its next meeting. The clause was required to ensure misuse of coal, said a senior government official. However, private power companies call the clause unfair as discoms have not been floating power requirement tenders regularly. They say the proposed auctions will put winning companies at a disadvantage when they compete for bagging power supply tenders floated by state distribution companies. “Signing power purchase agreements (PPAs) is not in the control of the power companies. There have not been many long-term contracts in the last seven years and looking at the low demand, subdued price of power in the market and falling prices of renewables, the probability of signing PPAs is very low. “We already have an example of mine auctions wherein those who took mines without PPAs have not been able to secure PPAs and operationalize their mines till date. The coal auction policy also puts companies that take part in it at a disadvantage visa-vis those getting coal from CIL at notified price, thus distorting the competitive landscape,” said Association of Power Producers director general Ashok Khurana. As per the proposed policy, the government will auction coal for companies that have the letters of assurance (Lo-As) for coal signed by staterun Coal India with power plant developers. The policy also proposes that all future coal tie-ups by CIL will be allotted to state distribution companies that in turn will call tariff-based competitive bids from companies on the lines of ultra-mega power projects. The policy proposes to auction coal to commissioned and to-be-commissioned power plants with a rider that they will sign the PPAs within two years. Earlier the government proposed to auction coal separately to power plants with PPAs and power plants without PPAs. In July last year, the Cabinet Committee on Economic Affairs had deferred decision on the policy for award of CIL contracts to power firms. The government has already finalised a policy for auction of Coal India contracts to unregulated sectors such as steel and cement. The private steel and cement firms will have to indicate their coal requirement and their end-use projects to the coal ministry before bidding for supply from Coal India Ltd. Brian O’Neill Jersey
Oil Ministry moves Cabinet to get RIL, ONGC pricing freedom
In a boost to firms like Reliance Industries and ONGC, the oil ministry has moved a proposal to the Cabinet for allowing pricing freedom for natural gas produced from coal seams. The ministry has proposed to the Cabinet that coal-bed methane (CBM) gas producers be given pricing freedom and allowed to price the fuel at market rates, sources privy to the development said. This will help operators quickly put in production the CBM blocks they hold and reverse the trend of investors relinquishing coal-seam blocks due to viability issues of current pricing. Of the 33 CBM bearing blocks awarded so far in four auction rounds and on a nomination basis, gas is being produced from only four. The proposal put to the Cabinet is for allowing CBM operators to sell the gas at market rate determined through an arms-length process, they said, adding that operators are also proposed to be allowed marketing freedom. The move will benefit Reliance which has two blocks in Madhya Pradesh that are in the process of starting production. ONGC and Essar OilBSE -0.15 % too will benefit from the new policy as it will help them put their acreage into production quickly. The four CBM blocks in production have a combined output of 1.17 million standard cubic metres per day. As many as 18 blocks have either been relinquished or are in the process as operators found that it did not make economic sense to produce gas at the prevailing rates. Most of the natural gas produced in the country is priced at an average of rates prevailing in gas surplus nations like the US, Russia and Canada. The current price comes to $2.5 per million British thermal unit, a rate considered unviable by many operators. Sources said pricing freedom is enshrined in the CBM contracts. These contracts, they say, are based on fixed revenue that the government will get from sale of CBM gas, and higher the rate of gas, the higher the government revenue. Unlike contracts for exploration and production of conventional natural gas, those of CBMs do not provide for cost recovery. According to the Directorate General of Hydrocarbons (DGH), India has the 5th largest proven coal reserves in the world and holds significant prospects for exploration and exploitation of CBM. The estimated CBM resources in the country are about 92 trillion cubic feet. The 33 CBM blocks awarded so far hold a total of 62.4 tcf of the estimated CBM resource, of which, so far, 9.9 Tcf has been established as Gas in Place (GIP). The sources said the CBM gas pricing policy proposed to the Cabinet is in line with the recently unveiled regime governing small and marginal oil and natural gas blocks. The government had recently auctioned small and marginal discovered oil and gas fields by promising investors complete pricing, marketing and production freedom under a revenue sharing contract agreement. Pricing freedom would help quickly ramp up CBM gas production to targeted 5.77 mmscmd within a year, they said. Logan Thomas Jersey
Disruptive changes to alter oil & gas industry dynamics: ICRA
The crude oil era is set for a structural slowdown leading to significant implications for different stakeholders in the oil & gas, said ICRA in a recent study. In its report, ICRA said crude oil, since its emergence in early 1900s, is witnessing a steady rise in usage to about 45% of global energy consumption by mid-1970s. Subsequently it reduced to 30% due to the emergence of other energy sources notably natural gas, it continues to be a fuel to reckon with among policy makers. At present disruptive potential for oil consumption levels comes from environmental concerns, car-pooling, electric cars, solar power, LNG based commercial vehicles, advent of e-rickshaws, e-bikes and driver-less cars. K Ravichandran, senior vice president and group head, corporate sector ratings said: “Electric or battery-driven vehicles are a key threat for demand of auto-fuels. The battery cost of an electric vehicle, accounting for almost one-third of the total cost of such vehicles will remain a key determinant in the rate of acceptance of electric vehicles.” “With anticipated material fall in battery costs, the break-even crude price for electric cars is expected to decrease from $185 per barrel to to $75per ICRA’s estimates,” he said. LNG based trucks and buses are likely to make a large dent in crude usage. Such vehicles would help reduce pollution from diesel leading to lower operating expenses offsetting higher capital costs. “As per ICRA estimates, break-even period for a truck would range 1-2.5 years depending upon taxation on LNG. However, developing an LNG-based transport fuel market shall have its own challenges, especially in building a network of fuelling stations to ensure the supply of LNG, when most of the trucks and buses on the road are powered by diesel or petrol engines.” said Ravichandran. Additionally, consistent fall in solar module prices leading to material fall in solar power tariffs have led to material increase in competitiveness against power plants based on liquid fuels, and the trend is likely to continue. Besides, replacement of diesel, by natural gas or LNG primarily for back-up power generation would also impact the demand of petroleum products. Dwayne Allen Jersey
Oil field leases may be extended 4 years before expiry
The government will extend the lease for oil or gas fields four years before the initial 20-year term expires, failing which an extension plea would be deemed to have been rejected, says a draft proposal on the new exploration policy aimed at eliminating extension uncertainties faced by contractors. Billionaire Anil Agarwal-owned Cairn India has been lobbying the government for years to extend the contract to operate the oil and gas block in Barmer, Rajasthan, by 10 years after the initial 20-year agreement runs out in 2020. Cairn contributes nearly 30% of India’s domestic output and has urged the court for more than a year to direct the government to quickly decide on an extension. The draft rules, when formalised, will not apply to the Barmer block but will end the kind of uncertainty Cairn faces today for blocks awarded under the new exploration policy. According to the draft contract under the new Hydrocarbon Exploration and Licensing Policy (HELP), the lease has to be granted for an initial period of 20 years, which can be extended by mutual agreement between the government and contractors for “five years or beyond as may be mutually agreed, or as per extant government policies.” The previous policy provided for an extension of five years for an oilfield and 10 years for a gas field, or such period as was mutually agreed upon. The draft contract, open to stake holder consultation, requires the contractor to submit a request for extension ‘no later than 5 years before the expiry of the existing contract’. “The Government reserves the right to approve the request for extension no later than 4 years before the expiry of the existing contract. If not approved within the stipulated time, such a request would be deemed to be rejected,” as per the draft contract. Last year, the government had announced a policy on extension of the so-called Pre-NELP ‘discovered’ fields, or 28 small, medium sized fields discovered by Oil and natural Gas Corp (ONGC) and Oil India Ltd and awarded to private joint ventures between 1994 and 1998. The policy, most importantly, required the government share of profit to increase by ten percentage point during the period of extension. Cairn’s Barmer field is not covered by this policy. Indian oil and gas fields are guided by different contracts, depending on the specific policies prevalent at the time they were awarded. Robert Hagg Jersey
Govt confident of meeting aggressive infra targets even without private investments
India’s infrastructure development is set to accelerate and meet global benchmarks even if the private sector is not in a hurry to grab the vast investment opportunities that are opening up, top cabinet ministers said at the Economic Times India Infra Summit 2017. The government is confident of meeting aggressive targets and wants private investment in infrastructure but it has enough resources and access to financing to implement projects, minister of road transport, highways and shipping Nitin Gadkari told the gathering of industrialists, chief executives and corporate leaders in NewDelhi on Thursday. “Our sector is moving and you all are welcome to participate. But don’t misunderstand me we don’t have any problems in investing. NHAI (National Highways Authority of India) is ‘AAA’ rated and investors want to invest in it. Our toll income is more than Rs 10,000 crore a year,” he said. “We already have a lot of offers from investors… We have 101 projects which we can monetise and get Rs 1.2 lakh crore.” He said the government will give the highest priority to local investors and contractors. Railway minister Suresh Prabhu said the government had inherited challenges as no investments were made by its predecessors in capacity building or improving services. “We have a huge historic backlog in which not only we have not invested, we have hardly done anything in the railways,” Prabhu said. The government expects a big pickup in investments. Urban development minister Venkaiah Naidu said investment of Rs 2.25 lakh crore is expected under the smart city mission, of which the central and the state governments would offer about Rs 1 lakh crore while the private sector is expected to bring in about a quarter of the total, Naidu said, adding that the smart city concept was not elitist and would benefit everyone. “The Smart City Mission is intended to be a game changer in respect of planning, execution and resource mobilisation,” Naidu said. India needs “political mainstreaming of the urban agenda” as population growth in cities has overtaken that in villages and better solutions are needed, Naidu told a diverse audience at the summit. Between 2001 and 2011, population rose by 91 million in urban areas as against 86 million in villages. In the next 15 years, about 250 million more people are expected to be added to cities. “The need of the hour is for political mainstreaming of urban agenda. We need to intensify political and public discourse about urban challenges so that meaningful solutions emerge,” Naidu said, admitting myriad challenges that Indian cities faced and illustrating how a government initiative like developing 100 smart cities across the country could elevate quality of life. BOOSTING RAIL SERVICES Prabhu said the government was working to bring rail services on a par with global standards. “We are trying to work on a holistic, all-pervasive plan of changing railways, not just creating infrastructure in a manner that will conform to the global standards to live up to the expectations of people. But unfortunately, it will take time,” he said. The railways was raising financial resources on an unprecedented scale and at the lowest coupon rates, he said. “We are raising these resources and putting them where required,” he said. Revenue from freight and passenger fares have been under serious threat and despite that the government has made reforms in the freight sector by reducing prices, executing long-term contracts and offering discounts. Indian Railways is also trying to raise revenue by introducing new services for passengers. It’s emphasising infrastructure investment, which is leading to more traffic, Prabhu said. A plan to save Rs 41,000 crore in 10 years by reducing energy costs has been prepared. Salaries and pensions are big costs over which the government does not have any control but the railways is conducting human resource audits that will improve productivity in the future. The railway dedicated freight corridor will be operational by the end of 2020 and that will ease freight traffic. The railways is also working on the development of stations. Prabhu said the government will bar the manufacture of conventional coaches from April 1 and focus on those with much better features and technology. Jamal Adams Jersey
Actis sets aside $500 million for renewable energy projects in India
Private equity fund Actis Capital, which has just completed raising $2.75 billion, has earmarked $500 million for investing in India’s wind and solar projects, according to industry sources. Actis completed its fourth energy fund a couple of days back. It had targeted $2 billion, but ended up with $2.75 billion upon oversubscription. In a press release, Actis’s Partner and Co-head of energy business, Mikael Karlsson, notes that “as the leading growth market investor in the energy sector, we have never seen a more compelling market opportunity.” In 2013, Actis had raised $1.5 billion for its ‘Actis Energy 3’. A substantial part of it has been invested in India. In a parallel development, it is learnt that Actis has appointed Gaurav Sood as its CEO. Sood was the Managing Director of SolaireDirect, the French company that made news when it won a 5-MW solar project in December 2011, quoting a then record low price of ?7.49 a kWhr. SolaireDirect has since been taken over by the French utility Engie. Actis is an old hand in India, and has funded several renewable energy projects in the country in the last decade. One of its larger investees is Ostro Energy, which was in the news last month, having won 250 MW of solar in Madhya Pradesh auctions last month, quoting a price of ?3.29 a kWhr, (averaged over 25 years.) Actis is very aggressive in India, said an industry source, who requested not to be named. It intends to build a renewable energy portfolio of 2 GW, mostly solar — in addition to Ostro. Colby Rasmus Jersey
Electricity And Elections In India
Prime Minister Modi’s ‘if electricity is supplied during Ramzan, it should also be supplied during Diwali’ remark during the Fatehpur rally in Uttar Pradesh received considerable flak from all sections of society, for its communal undertones. While of course the PM’s remarks are surprising, but what is unfortunately most amusing is how long ‘providing electricity’ has been on the agenda of political parties – for State and General elections. For a country aspiring to be amongst other developed nations in the world, it is ironic that in so many years since independence, government after government has failed to keep up its promise of providing electricity. Having grown up in a house where elections have always been closely followed and newspapers religiously read, I have during every State and General election heard contestants talk about providing electricity. Two decades later, it’s 2017 and parties are still promising the people of their constituencies the same. Not just local MLAs, but electricity is what even Chief Ministers and the Prime Minister of the country are making promises of in their campaign rallies and speeches. Electricity is a development indicator and critical for India’s economic growth. It is estimated that 7 per cent of the GDP is lost due power cuts, thus it is imperative that to keep the momentum of growth going, the country have uninterrupted power supply. Of the 1.4 billion people in the world who have no access to electricity, India accounts for over 300 million. It is the world’s third largest producer and fourth largest consumer of electricity. Despite poor hydro electricity generation, in 2015, India became a power surplus nation with huge electric power generation capacity, but despite that the country uses only half of what it generates. The provision of electricity is shared responsibility between the central and state governments, with states having considerable freedom to set electricity prices, the average subsidy level and the beneficiaries of the cross-subsidisation. Political parties in the past and for the ongoing State elections have been promising 24 hours of electricity supply in their respective constituencies. PM Modi during his campaign rallies for the 2014 General elections claimed that if elected, he would ensure ‘power for all.’ It was also in this year that the World Bank ranked India as having the world’s largest un – electrified population. While the present government has made some progress towards fulfilling its promise for ‘power for all’, India’s most marginalised citizens still have no access power. At present, 30 per cent of villages are yet to be electrified, with sharp variation across the country. Less than half of the rural households in Uttar Pradesh, Bihar, Nagaland and Jharkhand receive electricity; while Uttar Pradesh, in comparison to Bihar has more electrified rural households. In other big states such as Maharashtra and Rajasthan almost 75 per cent of rural households have electricity. Part of the explanation for this disparity among states is the varying income levels and population density; with low-income, densely-inhabited states performing worse than average. The AAP’s manifesto for the Punjab Elections too carries promises of cheaper electricity, in the State. While in UP, the SP seeking re-election has promised 24 hours of power supply to domestic consumers in urban and rural settings. There has also been news of the JD (U) planning to contest in the upcoming municipal elections in Delhi, with the hope of cornering AAP on the issue of electricity among others. From the manifestos of the various parties and the points raised during campaign rallies, it is evident how fundamental electricity is to the campaign rhetoric, as well as how it used to garner votes. Thus it is worth pondering upon why despite being a power surplus nation, large parts of the country are yet to be electrified. For over two decades, political parties in India have continued their vote bank politics over electricity, which is not just hitting the common man, but also hampering the GDP of the country. It is also important to note that not just false promises, but also infrastructural deficiencies such as poor metering, inefficient billing and collection, inadequate investment, high transmission and distribution losses and regular power outages are also contributing factors to why several parts of the country remain un-electrified. Theses infrastructural deficiencies are also a key weakness for the country’s energy sector. The World Energy Outlook Special Report (2015) concluded that ‘India’s ties with the international energy systems are set to deepen, intensifying India’s dependence and influence on international markets, through trade, investment, clean technology cooperation and other channels.’ However, these energy systems which are ‘set to deepen’ do not seem to improve within the country. Thus the question arises of whether energy systems in India are incapable of providing electricity for all its systems or is it the lack of political will which hampers the electrification of the entire country. Union Minister of State for Power, Piyush Goyal following the 2017 budget proudly claimed that India has become a ‘power surplus’ nation, despite 30% of rural households remaining un – electrified. It now remains to be seen whether the Narendra Modi led government will fulfil its promise of ‘power for all’ before the 2019 general elections or if electricity for all will continue to remain only an ‘election campaign’ for another two decades.
Electronic Tags for Toll Collection at National Highways
The National Highways Authority of India (NHAI) has incorporated Indian Highway Management Company Limited (IHMCL) to expedite the implementation of Electronic Fee Collection (EFC). Minister of State for Road Transport and Highways Shri Pon. Radhakrishnan said in a written reply to a question in Lok Sabha today that National Payments Corporation of India (NPCI) has been engaged to work as Central Clearing House (CCH) to implement inter-operability so that several banks could participate in the EFC programme. As on 03.03.2017, the participating banks are SBI, KVB, ICICI, AXIS, IDFC and Equitas SF Bank. As on 03rd March 2017, total 3,47,200 electronic tags have been issued for fee collection on National Highways. The Road users are being encouraged to use electronic means for payment of user fees for seamless travel through fee plazas. Government has also notified the use of pre-paid payment instruments vide Notification G.S.R 1114 (E) dated 02nd December, .2016 for collection of user fee from road users. This is to permit road users to opt for available cashless modes of payment. NHAI has facilitated the Concessionaire and Contractor to use POS machines for collection of user fees through credit & debit card. Since, FASTag is not mandatory for payment of user fees for use of National Highways; therefore, no target/deadline has been fixed. Malachi Richardson Authentic Jersey