Investment by Private Sector companies in Indian Power Sector reduced by 44% during FY 2012-13...

 

During the financial year of 2012-13, the investment in Indian Power Sector by the private companies have been decreased by 44% compared to the previous financial year of 2011-12.

During the FY12-13, investment done by the private companies in the power sector was around Rs. 54,953 Crores which in FY11-12 was around Rs. 98,283 Crores.

According to Independent Power Producer's Association of India, the major reasons behind this decline were uncertainties on fuel supply, issues related to regulatory & policy framework. It further assumes that the investment has further declined in the current financial year.

According to various industry experts:

• The investment was low as there was no demand for electricity from state distribution companies and also as no new projects are being bid by the government. Whatever investments we have seen so far are on projects that were planned earlier. Companies with existing plants are suffering losses due to fuel scarcity so the ability to invest is low. No major power procurement tenders from state distribution companies besides Uttar Pradesh, Tamil Nadu and Rajasthan. 
• Thermal power plants are stranded or underutilized due to shortage of gas and coal shortage. Data available with the Central Electricity Authority shows that coal-based plants operated at 63% of their capacity in June, while gas power plants at 29%. Coal-based power plants can be run partially on imported coal but that raises costs leading to non-purchase by state distribution companies.
• Power regulator Central Electricity Regulatory Commission (CERC) has allowed companies like Tata Power and Adani Power that operate imported coal-based plants to recover additional costs from state distribution companies. The government has also recently allowed power-generating companies to bill the distribution utilities for additional cost incurred on imported coal. But poor financial health of distribution companies does not allow them to purchase power generated from imported gas or coal.
• The government is yet to finalize new guidelines for bidding power plants that was stopped in 2011.

The country's power generation capacity increased by 20.6 GW in 2012-13, however due to issues related to fuel such as coal and gas on an average, 27% of the country's available 1,46,000-mw power generation capacity is under outage.

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http://economictimes.indiatimes.com/news/news-by-industry/energy/power/private-investment-in-power-sector-slumps-44/articleshow/21652597.cms

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Coal India supplied 88% of committed coal to the power plants during Q1 of 2013...

 

During Q1 of the current financial year, Coal India Limited has supplied around 86.39 million tonnes of coal to power sector which is almost 88% of the commitment of 96.41 million tonnes under the Fuel Supply Agreements (FSA).

As said by the Coal Ministry, during April 13 coal stocks with power plants has gone up to 19.75 million tonnes which is equivalent to 14 days' requirement whilst as on July 29, 2013 same was around 22.02 million tonnes which was equivalent to 18 days' requirement.

Presently, 65 power plants are carrying coal stock equivalent to more than 15 days' requirement and as a result, quite a few power stations have started regulating coal supplies to avoid further build up of stock at their end.

Coal supply to power sector is monitored regularly by an inter-ministerial sub-group comprising representatives of ministries of coal, power and railways.

This sub-group suggests various decisions to ensure uninterrupted coal supplies to power utilities and for meeting any contingent situations relating to power sector including critical coal stock position.

Coal India Ltd had supplied 343.79 million tonnes of coal to power companies during 2012-13, a growth of more than 10% over the previous year. This was against a supply target of 342.31 million tonnes for the year

CIL has guaranteed to supply 90% of annual contract quantity for thermal power plants commissioned prior to March 2009 and 80% of the quantity for projects commissioned thereafter.

 

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More literature on this topic...

http://articles.economictimes.indiatimes.com/2013-08-05/news/41093185_1_coal-india-ltd-coal-supply-fuel-supply-agreements

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Tata Power recorded consolidated net loss of Rs. 114.7 Crores in Q1 of 2013...

 

Tata Power has recorded consolidated net loss of Rs. 114.7 Crores in the quarter ended June-13 as against the profit of Rs. 145.9 Crores during the same period a year ago.

 

As said by the company the higher interest payment and forex loss has resulted in the poor financials of the company.

• Consolidated net revenue increased by 29 percent on yearly basis to Rs 9,292 Crore
• Earnings before interest, tax, depreciation & amortization (EBITDA) margin jumped 290 bps year-on-year to 21.7 percent
• Foreign exchange loss rose by 6.5 times to Rs 292.8 Crore during April-June quarter from Rs 45.2 Crore in corresponding quarter of last fiscal.
• Finance costs (interest payment) ballooned 64.3 percent year-on-year to Rs 902 Crore in first quarter. Finance cost includes Rs. 45 Crore being provision for interest on amounts which have not been deposited with the statutory authorities on account of disputes which are pending.
• Consolidated EBIT from power business doubled to Rs. 1,303.52 Crore from Rs 579.45 Crore Y-o-Y due to higher generation after commissioning of Mundra units, but EBIT of coal business (mining and trading) plunged nearly 63 percent on yearly basis to Rs 96.19 Crore during June quarter.
• On standalone basis, net profit increased to Rs 357 Crore from Rs 312.30 Crore and revenues rose to Rs 2,484.89 Crore from Rs 2,190.02 Crore Y-o-Y.

 

Click below to view the real-time stock prices of Tata Power.

 

 

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http://www.moneycontrol.com/news/results/tata-power-q1-loss-at-rs-115crinterest-cost-forex-woes_931177.html

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RPower approaches CERC seeking increase in tariff for all of its UMPPs...

 

Reliance Power Limited  (R-Power) has approached the Central Electricity Regulatory Commission (CERC) to revise the tariff of all of its 3 Ultra Mega Power Projects in the country.

Tilaiya UMPP

According to the company, the cost of Rehabilitation & Resettlement (R&R) has been increased seven fold from Rs. 530 Crores to Rs. 3,500 Crores over the original pre-bid estimated. The increase in project cost has led most of the lenders to doubt the bankability of the Project.

• Due to this it has asked the CERC to revise the tariff of its Tilaiya UMPP (Jharkhand) to RS. 2.25 per unit which is more than 25% increase from the bid price of Rs. 1.77 per unit.

Sasan UMPP

R-Power has also sought compensation from the government for the falling rupee and cost escalation due to increase in taxes and input costs for its 4,000 MW Sasan UMPP at Madhya Pradesh

Krishnapatnam UMPP

• Krishnapatnam UMPP in Andhra Pradesh, which is based on imported coal, is facing regulatory issues over rise in coal prices and water costs.
• R-Power has sought a revision in tariff after Indonesia increased coal prices.

 

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More literature on this..

http://economictimes.indiatimes.com/news/news-by-industry/energy/power/anil-ambani-led-reliance-power-seeking-tariff-increase-for-all-umpps/articleshow/21644640.cms

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Su-Kam and Tata Power signs MoU for roof-top solar projects for its consumers...

 

Su-Kam Power Systems Ltd, has signed a Memorandum of Understanding (MoU) with Tata Power Delhi Distribution (TDPPL) to offer its subscribers exclusive rates for rooftop solar projects,

Under the MoU, the subscribers and employees of TDPPL can avail exclusive discounts on Su-Kam's Solar PV Modules, roof top solar systems and other solar power back up solutions.

According to the company, the move will help Su-Kam to reach wider customer base of over 14 lakh customers of North & North West Delhi.

Earlier, Su-Kam has undertaken projects for Tamil Nadu Energy Development Agency, Assam State Electricity Board, Madhya Pradesh Forest Department, Loyola College of Chennai, Ashok Leyland etc.

The company has also undertaken a number of solar projects in Afghanistan, Nigeria, Malawi, Gabon, etc.

 

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More literature on this...

http://economictimes.indiatimes.com/news/news-by-industry/energy/power/su-kam-to-offer-solar-installations-to-tata-power-consumers/articleshow/21647601.cms

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NPCIL's 6000 MW nuclear project receives recommendation for CRZ clearance from Gujarat Coastal Zone Management Authority...

 

Nuclear Power Corporation of Indian Limited's (NPCIL) proposed 6,000 MW nuclear power project at Mithivirdi, Bhavnagar District in Gujarat has received recommendation for Costal Regulatory Zone (CRZ) approval from Gujarat Coastal Zone Management Authority (GCRZMA).

The proposed nuclear power project will be having six Light Water Reactor of 1,000 MW capacity each.

The project is being set up at Mithivirdi which is around 40 km from Bhavnagar and is located on sea cost on the west side of Gulf of Khambhat spread across 777 Hectare.

The GCRZMA after hearing representation from NPCIL decided to "recommend to the Ministry of Environment and Forests, Government of India to grant CRZ clearance for construction of intake, outfall facilities, jetty and Desalination plant for the proposed Project.

Based on this, the CRZ clearance shall be received from Ministry of Environment and Forests (MoEF).

 

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More literature on this...

http://www.business-standard.com/article/economy-policy/gujarat-recommend-npcil-s-nuclear-power-plant-for-crz-clearance-113080500672_1.html

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Ramoji Group's newspaper to develop 6.5 MW Captive Solar Project for its printing presses...

 

Eenadu, the Telugu Newspaper owned by Ramoji Group, has planned to put up a 6.5 MWp Solar PV Project for the captive consumption of its printing presses.

According to the company officials, the Proposed Project will be having ground mounted structure with tracker system and will generate around 12,289,500 units of clean solar electricity annually.

As said by the company, the solar projects for captive consumption shall not only guards businesses against increasing electricity prices, it also provides good investment opportunity. This shall be a key business model for solar projects in India because it doesn't depend on incentive schemes, has no restrictions on system sizes, has low level of bureaucracy and makes industrial customers independent from fluctuations in energy prices.

According to sources, the proposed project will be set up by the EPC Contractor Photon Energy Systems and will be completed by September 2013. It will be having around 25,720 panels from Norway based Renewable Energy Corporation (REC). 

 

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More literature on this...

http://solar.energy-business-review.com/news/norway-firm-rec-to-supply-solar-panels-to-indian-newspaper-eenadu-050813

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MERC issues order on compliance of RPO by Captive & Open Access Consumers...

 

Maharashtra Electricity Regulatory Commission has issued an order for the compliance of Renewable Purchase Obligations (RPO) by Captive user & Open Access Consumers in the state of Maharashtra.

 

Brief details of the order are as follows:

• The Order covers only enforces the Captive Users and Open Access Consumers in the state of Maharashtra for Compliance of RPO.
• Above mentioned Obligated Entities are directed to fulfill their RPO targets for both Solar & Non Solar for all the four years i.e. from FY 2010-11 to FY 2013-14 cumulative before 31st March 2014.

• A Working Committee shall be formed which will focus on continuous monitoring of RPO compliance by a structured mechanism. The committee shall comprise of key officials from MERC, MEDA, MSLDC, PWD & Individual Consultants.

a. Mechanism for "Listing & Accreditation" of Obligated Entities

b. Mechanism for establishing the "Data Flow & Formats and Information Exchange

c. Compliance review on "Bi-monthly" basis

• Key responsibilities of MEDA:

a.    Submission of report on formation of Working Committee by 30^th September, 2013.
b.    Bi-monthly reporting to the commission on the development of RPO Mechanism.
c.     Quarterly update to the Commission on RPO Compliance by obligated entities.

• Every obligated entity has mandatorily submit “Monthly Reports over RPO Compliance" to MEDA.
  
• In case of non-fulfillment, penal mechanism as per the regulations stipulated in the MERC REC-RPO Regulations, 2010.

 

The said order will have positive impact on the struggling REC market in India for both Solar & Non-Solar segments and shall definitely improve REC market future in India.

 

Complete order by MERC is embedded below for further reading...

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