News digest

International: Russia, North Korea and South Korea have agreed to build an electric power line from Vladivostok to South Korea. Talks between Russia and South Korea have been taking place for some time, and North Korea has now agreed to the construction of the line across its territory.

Australia: Gas and electricity supplier Australian Gas Light Co. said it has addressed competition issues that could stop it from winning a A$3.5bn ($2.5bn) bid for the Loy Yang power station. AGL is seeking court approval to buy a 35 per cent stake in Loy Yang, the largest generator in Victoria state, after twice being rebuffed by the country’s watchdog.

China: China requires more than 20 nuclear power plants by 2020 to meet rapidly growing electricity demand. The country needs the new facilities to meet a projected nuclear electricity output of four per cent of total capacity or 32m kW, by 2020.

China: The Hongshui river in south China’s Guangxi Zhuang autonomous region was successfully dammed in November to pave the way for the construction of the Longtan power plant. The plant will start operating in 2009.

Indonesia: Amoseas Indonesia said it will build a third geothermal electricity generating plant in West Java, scheduled to start operation in 2006. The Indonesian unit of CheveronTexaco Corp. said the 100 MW plant, called Darajat Unit III, will be located adjacent to the existing Darajat Unit II near Garut.

Philippines: Four Japanese companies have been prequalified to bid for a contract to build a wind power farm in the northern province of Ilocos Norte that is expected to cost $56m. Sumitomo, Kanematsu, Marubeni and Mitsui have been declared eligible to bid.

Philippines: The Philippines sale of 30 state-owned power plants is due to start this month, according to Energy Secretary, Vincent Perez. The first plant on the auction block is the 200 MW oil-fired Navotas 1 power plant.

Sri Lanka: The government of Sri Lanka has invited the National Thermal Power Corporation (NTPC) to build a 300 MW power project. The project will be constructed on build-operate-own (BOO) basis and will be set up as a joint venture with the Sri Lankan government. Bharat Heavy Electricals Limited will join NTPC in providing the engineering procurement and construction services for the project.

Uzbekistan: The Asian Development Bank (ADB) has approved a technical assistance grant of $350 000 to assess the potential and options for renewable energy development in Uzbekistan.

Mission Energy exits Thai power project

US-based Mission Energy has sold off its interest in Thailand’s Bo Nok power project leaving the door open for Electricity Generating (Egco) and Japan-based J Power Group to take a 50 per cent stake each in Gulf Power Generation Co., the project operator.

Under the deal, Mission Energy will sell its 40 per cent stake in Gulf Power Generation to Gulf Electric Co., giving the latter a 100 per cent stake in the company. Egco and J Power jointly own Gulf Electric. Mission Energy will now focus on projects outside Asia.

The deal is expected to close before the end of 2003; the value of the transaction has not been disclosed.

Upon completion in 2008, the 734 MW Bo Nok plant will supply electricity to the state-owned Electricity Generating Authority of Thailand (Egat) under a 25 year power purchase agreement. A second stage of development may also see the $800m project being expanded to 1400 MW.

J Power has signed a six-year, ¥2.7bn ($24.9m) contract with the government of Sri Lanka (Ceylon Electricity Board) to provide consulting services for a 2 x 75 MW, hydroelectric power plant project near Colombo.

China funds new generators

China’s Three Gorges project, owned by China Yangtze Power Co., has tapped banks for ¥8.35bn ($1.01bn) to finance new generators. The company also launched a ¥9.9bn initial public offering (IPO) of 1.279bn shares in November.

The bank loan will be used to pay some of the debt used to build the four generating units that started up at the plant this year. China Development Bank has issued ¥35bn to the undertaking.

The IPO proved highly popular with investors, and was reported to be 70 times oversubscribed. Its popularity was helped by the fact that electricity consumption in the country is rising at an annual rate of 16 per cent. The project is expected to be completed by 2009.

Sime acquires 50 per cent stake in 715 MW power project

Sime Darby Berhad (SDB) has purchased a 50 per cent share in Island Power Company’s 715 MW natur

Island Power is a wholly-owned subsidiary of InterGen, and hopes to complete the plant by 2006. Upon completion Island Power will be the first IPP to participate in Singapore’s deregulated power pool. This will add stability to the market and help to meet the country’s need for low cost generating capacity.

Belgium’s Tractebel has announced the sale of its minority stakes in three joint ventures to its Singapore partner SembCorp Utilities. The g93m deal, to be finalized by year-end, involves the companies SembCogen, SembGas and SUT Sakra.

Power deregulation in Japan is too slow, says IEA

The international Energy Agency (IEA) has said that Japan has the highest electricity prices within the IEA member countries and that it should speed up liberalization of its power sector.

The energy agency reviews its 26 member states once every four years and concluded that the slow entry rate of newcomers to the Japanese electricity market was due to lack of competition. Japan needs to set up an autonomous organization to operate the country’s electricity transmission network system, said the IEA.

China Resources Power grows

China Resources Power Holdings has added to its portfolio by purchasing a ten per cent stake in Huaneng International Power Development Corp., China’s biggest independent power producer.

The move is the latest in a series of deals which have increased the company’s assets prior to a planned $300m listing. China Resources Power will own 1545 MW of capacity by the end of 2003.

Tasmania commissions storage system

Pinnacle VRB, a VRB Power Systems subsidiary, announced that it has commissioned the King Island Vanadium Redox Battery Energy Storage System (VRB/EES) at a Hydro Tasmania site in Australia.

The VRB/EES will smooth the short term output variations in wind generators and customer loads while providing frequency and voltage control. It will also implement a system of load shifting for a diesel-wind hybrid generation system.

King Island, a remote Island off the south coast of Australia operates five wind turbines ranging from 250 to 850 kW along with four 1.5 MW diesel generators. These units supply power to local residents and form part of Hydro Tasmania’s Renewable Energy Expansion Project.