Power generation in the country has dropped by 3.7% in September. Though analysts blamed lower coal output for the fall, generation from even renewable sources fell by as much as 7.13%, indicating an overall decline in demand.
Overall power generation in the country was 114.66 billion units in September, as against 119.07 billion units in the same month of 2018
The output of the core sector dropped to 5.2% in September, with production by seven of the eight industries declining, indicating slow economic growth in the second quarter of this fiscal year too. In September 2018, it had risen 4.3%, and 0.1% in August 2019. Data by the commerce and industry ministry showed production in coal, crude oil, natural gas, refinery products, steel, cement, and electricity declined in September. Coal contracted the steepest by 20.5%. Only fertilizer held out.
There’s just no stopping for coal in Southeast Asia. Surging investments in wind and solar energy won’t be enough to shake the fuel’s dominance in the region for decades to come, according to the International Energy Agency.
Coal demand is expected to double to almost 400 million tonnes a year by 2040, the agency said in its published Southeast Asia Energy Outlook. That’s 2.5% higher than its forecast from two years ago, even as renewable power capacity is seen more than tripling through 2040.
Commerce and Industry Minister Piyush Goyal said the fear-psychosis created around free trade agreements (FTAs) in India needs to be overcome if the country is to avoid global isolation. Goyal said a government has to balance consumer interests with industry interests and individual perspectives must be avoided.
Steel Authority of India Ltd (SAIL) may replace fellow PSU mining company, NMDC, in a steel-making joint venture with an Australian technology company.
In May 2018, two Indian PSUs, NMDC and NLC India Ltd, signed an agreement with Environmental Clean Technologies of Australia to use the Australian company’s ‘Matmor’ technology to make steel with cheap lignite rather than costly coking coal.
The resolution of stressed thermal assets remains slow despite various measures undertaken by the Government and lenders.
According to ICRA, about 10% of the 40 GW stressed coal-based capacity achieved resolution mainly through acquisition by a new sponsor. The balance capacity is under various stages of resolution, including through Insolvency and Bankruptcy Code (IBC).
Girishkumar Kadam, Sector Head & Vice President, ICRA Ratings told about the reasons for slow progress for resolution of stressed assets. These are:
Time taken to achieve sustainable resolution;
Regulatory challenges in securing approvals for projects with existing competitively bid-based power purchase agreements;
Limited progress in signing of new long-term PPAs ;
Subdued thermal capacity utilization levels and
Lower than expected improvement in the discoms’ financial position on all India level, which can hamper the sustainability of demand growth and signing of new long-term PPAs.
The slowdown can be attributed to lower demand from household and agriculture segments following heavy rains in August 2019 and September 2019, and moderation in demand from industrial segment.