Indian power grid fails to avoid blackouts

Parts of India have suffered numerous blackouts over the past month, which have led to angry residents demonstrating in New Delhi. The cuts started at the beginning of last month when the government privatized its distribution network to two of the country’s distributors.

Some residents had to endure 14 hours without electricity over a ten-day period. The two companies responsible, Tata Power and BSES claim to be investigating the matter. Suggestions by the Federal Power Minister Suresh Prabhu, to resolve Dabhol Power Company’s dispute to intake the extra 2500 MW needed, was dismissed by the Industrial Development Bank of India as “uneconomical”.

India’s power sector is expected to fall short at around 29 000 MW instead of its projected 41 000 MW in its tenth plan period. Shortages are expected to continue as India’s continuing problem with electricity theft continues. Electricity is stolen by many residents including squatters and although officials have tried to eradicate the problem, the thefts are still rife.

Korea to install four nuclear power plants

BNFL subsidiary Westinghouse Electric company, won a $350m contract to provide components, instrumentation control equipment, technical and engineering support services to four new nuclear power plants to be built in Korea.

The plants will be under the Korea Hydro & Nuclear Power Company (KHNP). The construction value is in excess of $6bn. The Westinghouse contracts are with Doosan Engineering Company.

The Shin-Kori I and II and the Shin-Wolsong I and II plants will be located in Pusan Metropolitan City and Kyungju-City respectively. Work will begin almost immediately and will run to 2009 for Shin-Kori and 2010 for Shin-Wolsong.

AEP sells CitiPower asset

American Electric Power (AEP) sold CitiPower, AEP’s retail electricity and gas supply and electricity distribution subsidiary in Australia, to Cheung Kong Infrastructure Holdings and Hong Kong Electric for $A1.55bn ($885m).

The sale proceeds will aid AEP to reduce debt. Cheung Kong Infrastructure and its subsidiary Hong Kong Electric will sell the electricity retailing arm to Australian-listed energy company Origin Energy for $A135m.

Indonesia plans geothermal bill

The Indonesian state plans to implement a law on geothermal power that will ensure legal certainty for investors in the field. The move will help guide the government in formulating its geothermal policy.

The plans came from the House Commission VIII on energy and mineral resources. All nine factions approved the proposals. The Golkar Party faction endorsed the initiative on the grounds that the law on geothermal power could aid legal certainty. Legal certainty is deemed important as geothermal power is considered a high-risk investment for investors.

Unocal Geothermal of Indonesia and Dayabumi Salak Pratama, a 50 per cent equity investee of UGI reached agreement with PLN, the state-owned electricity giant, over pricing and production issues at the 330 MW, Gunung Salak geothermal project in Indonesia.

Napocor approves Kepco pay deal

National Power Corp. (Napocor) approved an agreement with Korean Power Corp. (Kepco) on the latter’s payment of penalties for delays in the commercial operation of the natural gas-fired Ilijan power plant.

The payment will be in the form of ‘free energy’. Kepco will sell power to Napocor without profit until damages of $38.4m, have been offset.

Four firms battle for China contract

General Electric, Alstom, Siemens and Mitsubishi have gone through to the final selection round to supply equipment and services for the Chinese government’s plans to install 23 gas turbines in ten power plants, generating 8000 MW.

The final decision on the most successful of the four equipment companies will be announced early next year. The combined cycle projects will be fuelled by gas from the West to East pipeline or from the LNG terminal being installed in Guangdong Province.

The gas turbine plants will be ready by 2005 and will be added with a further 16 000 MW by 2011. The nature of the project is to ease the country’s emissions produced by China’s rich coal reserves.

Clarification: PEi would like to clarify a news story published in our July 2002 issue (‘Delayed Ilijan project powers up Luzon grid’, Vol 10, Issue 7, p11), in which it was stated that problems uncovered in the rotor of the gas turbines resulted in a five-month delay to the Ilijan power plant project in the Philippines. Further investigation has revealed that a number of factors caused the delay, including late commissioning of a key transmission line, commissioning, construction and procurement delays, technical problems with the black start diesel generators and modifications made by MHI to the gas turbines to improve the cooling efficiency of the stage 1 blades and to enhance the overall endurance performance of the machines. The plant is now operating as expected, according to the owner.

News digest

Australia: Pinnacle VRB, a subsidiary of Vanteck (VRB) Technology Corp., has won the contract for the energy storage component of Hydro Tasmania’s King Island wind energy expansion project in Australia. Pinnacle VRB won the tender to construct and install a VRB with a rated output of 200 kW and a rated output time of two hours.

India: Public Service Enterprise Group (PSEG) said it had decided to exit its Indian power plants, as state-run utilities had failed to honour their commercial contracts. PSEG, which holds equity in two Indian power plants, joins a series of foreign firms that have fled India’s troubled power sector.

Indonesia: Sumitomo Corp. will resume construction of a large thermal power plant in Indonesia. The 1200 MW thermal power plant, Tanjung Jati B, is located on the central part of the Island of Java. The project was brought to a halt in 1998 due to the economic crisis.

Korea: Korea Electric Power Corp. chose Korea South-East Power Co. as the first of its five power generation units it plans to sell as part of the government’s plan to privatize the electricity utility industry.

Malaysia: Three agreements related to the proposed coal-fired power plant in Mukim Serkat, Pontian, Johor, were signed on July 25 by Tenaga Nasional Bhd (TNB) and SKS Power Sdn. They are the power purchase agreements for the sale and purchase of power, a coal supply and transport agreement for the supply of coal, and a transmission works agreement for grid system reinforcement with power offtake to be undertaken by SKS.

New Zealand: Officials at New Zealand energy networks company, UnitedNetworks said it had short-listed bidders for the purchase of either the whole firm or some of its assets. The company is seeking buyers for all its shares or assets because its majority shareholder US networks company Acquila Inc, is seeking to exit the company.

Philippines: Senate majority leader Loren Loggerhead asked the Dept. of Environment and Natural Resources to close five coal-fired power plants of the state-run National Power Corp., which reportedly emit hazardous substances like mercury to their surrounding communities in violation of the Clean Air Act.

Singapore: Mirant is shelving plans to enter the South Korean electricity market and will sell its rights to build a 520 MW power plant. The Atlanta-based company announced last December it would buy Hyundai Energy from Hyundai Group, along with the land and rights to build a power plant to supply electricity to state-owned monopoly Korea Electric Power Corp.