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Coal

Indonesia sets Jan HBA thermal coal price at $92.41/mt, down 0.11% on month

7 January 2019

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Indonesia

Singapore — Indonesia’s Ministry of Energy and Mineral Resources has set its January thermal coal reference price, also known as Harga Batubara Acuan or HBA, at $92.41/mt, down 0.11% month on month, and down 3.28% year on year.

China’s import limitation impacted the seaborne thermal coal prices, according to the ministry’s spokesman Agung Pribadi.

The ministry had set the price for December at $92.51/mt, and for January 2018 at $95.54/mt.

The HBA is a monthly average price based 25% each on Platts Kalimantan 5,900 kcal/kg GAR assessments, Argus-Indonesia Coal Index 1 (6,500 kcal/kg GAR), Newcastle Export Index (6,322 kcal/kg GAR) and globalCOAL Newcastle (6,000 kcal/kg NAR).

In December, the daily Platts FOB Kalimantan 5,900 kcal/kg GAR coal assessment averaged $68.02/mt, down from $69.35/mt in November, while the daily 7-45 day Platts Newcastle FOB price for coal with a calorific value of 6,300 kcal/kg GAR averaged $99.93/mt, up from $99.42/mt in November.

The HBA price for thermal coal is the basis for determining the prices of 77 Indonesian coal products, and calculating the royalty producers have to pay for each metric ton of coal sold.

It is based on 6,322 kcal/kg GAR coal with 8% total moisture content, 15% ash as received and 0.8% sulfur as received.

Energy Cooperation

Vietnamese, Lao PMs co-chair meeting of inter-government committee

7 January 2019

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Lao PDR ,
Vietnam

HÀ NỘI — Vietnamese Prime Minister Nguyễn Xuân Phúc and his Lao counterpart Thongloun Sisoulith co-chaired the 41st session of the Việt Nam-Laos Inter-Governmental Committee in Hà Nội on Sunday.

PM Phúc expressed his delight at the positive development of traditional friendship, special solidarity and comprehensive co-operation between Việt Nam and Laos in diverse areas over the recent past.

PM Sisoulith believed the meeting will create a new driving force for the practical and effective development of bilateral ties.

Both sides were satisfied with the outcomes of co-operation between the two governments in 2018, especially in politics, external affairs, national defence-security, social safety and order.

More than 400 projects worth about US$4.1 billion by Vietnamese firms contributed to Laos’ socio-economic development. Two-way trade between the two nations exceeded the $1 billion benchmark in 2018, up 14 per cent year-on-year.

Several strategic transportation connectivity projects are underway while the number of Vietnamese scholarships to Lao students keeps increasing, helping to raise the total number of Lao students in Việt Nam to more than 14,200 so far.

Both sides reached consensus on co-operation orientations for 2019, which lays the focus on collaboration across the fields of politics, foreign affairs, defence, and security.

Regarding economic ties, the two countries will exchange experiences in building policies to stabilise the macro-economy and promote sustainable development. Also, they will work together to create business conditions for companies in each nation to reach 10 per cent growth in two-way trade this year.

Meanwhile, improving the quality of education-training cooperation will be prioritised, of which historical works highlighting the special relations between the two countries will be added to curriculums at both Vietnamese and Lao schools.

In addition, competent ministries, sectors and localities will foster the practical and effective co-operation in culture, science, society, communications, sport, healthcare, and legislation, among others.

In the spirit of special trust, the two sides agreed to continue close coordination and mutual support at regional and international forums. The two countries will accompany each other to deepen the cooperative progress of the ASEAN Community, and enhance the ASEAN’s role in strategic issues of the region, including the East Sea matter.

Furthermore, they were unanimous on co-operation in effectively and sustainably using water resources in the Mekong River.

Laos also backed Việt Nam’s candidacy for a non-permanent seat in the United Nations Security Council in the 2020-21 tenure.

PM Phúc stressed that right after the session, the Vietnamese Government will direct relevant ministries, sectors, localities, enterprises and units to closely collaborate with their Lao counterparts to immediately and effectively implement the just-made decisions.

Following the session, the two PMs witnessed the signing and exchange of six documents, including an agreement on the cooperation plan between the two governments in 2019, the minutes of the session, an agreement on the Vietnamese Government’s provision of 300 tonnes of rice seeds to the Lao Government, an agreement on the educational co-operation plan for 2019, the minutes on the transfer of the radio-TV station in Laos’ province of Savanakhet, and the minutes on the transfer of the Vietnamese-language faculty project at the Suphanouvong University and the Champasak University.

Bilateral meetings

On the same day, General Secretary of the Communist Party of Việt Nam (CPV) Central Committee and President Nguyễn Phú Trọng hosted a reception for Lao Prime Minister Thongloun Sisoulith.

Trọng congratulated Laos on its important domestic and foreign achievements over the past three years of implementing the Resolution of its 10th National Party Congress and expressed his delight at the deepening Việt Nam-Laos relations.

The Vietnamese leader highly valued the outcomes of the 41st session of the Việt Nam-Laos Inter-governmental Committee, describing it as a very important basis for the two countries to successfully implement the agreement on the cooperation plan between the two governments in 2019, as well as the Việt Nam-Laos co-operation agreement for the 2016-20 period.

He asked the two governments to work together in directing their ministries, sectors, localities and firms to implement the agreements reached at the session, focusing on the exchange of information and experiences in Party building, socio-economic development, close collaboration in national defence-security and foreign affairs, and seek ways to untangle the knots so as to improve the effectiveness of the cooperation in economy, investment, trade, culture, education, and science and technology.

Sisoulith expressed his belief that under the leadership of the CPV led by the General Secretary, the Vietnamese people will reap greater achievements in the renewal process and successfully realise the Resolution adopted by the 12th National Party Congress of the CPV.

During the meeting with the Laos PM, National Assembly (NA) Chairwoman Nguyễn Thị Kim Ngân said the Vietnamese NA will closely co-operate with the Lao parliament in continuing to create favourable conditions for the two governments to effectively implement their bilateral agreements.

Ngân further said she hopes the implementation of the key projects between the two countries on energy and transport will be accelerated. Especially, the quality and tempo of the construction of the Lao NA office should be ensured.

Host and guest also shared important experiences in law-building work and the holding of the confidence votes on officials elected or approved by the National Assemblies. — VNS

Read more at http://vietnamnews.vn/politics-laws/483296/vietnamese-lao-pms-co-chair-meeting-of-inter-government-committee.html#qzlW4OJfUeB4fmec.99

Renewables

Vietnam eyes green power, not to sacrifice environment for growth | Retail News Asia

7 January 2019

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Vietnam

he government Thursday reaffirmed Vietnam’s desire for a greener energy mix amid the risk of a power deficiency. Environment-friendly coal- and gas-fueled and renewable power plants would make up the mix. While Vietnam faces “obvious risks of an energy shortage in the coming years … it will not sacrifice the environment for economic growth,” Deputy Prime Minister Trinh Dinh Dung said in a meeting with the state-run Vietnam Electricity (EVN), the country’s largest power producer and monopoly distributor.

Coal-fired power is vital to energy security, but “it must be clean,” he noted. Dung asked EVN to pioneer the use of modern technologies to reduce the environmental footprint of new coal-fired plants and handle the cinder and ash at existing plants.

The country faces difficulty in increasing power generation since it has decided to put nuclear power on hold, many coal-fired plants are behind schedule and renewables could not be developed on a large scale due to “high costs” and transmission limitations.

“Hydro power currently meets 40 percent of the country’s demand, but additional supply is almost impossible.

“Our hydro power plant reservoirs, especially in the central region, are facing a serious water shortage, supply of coal for power development is erratic and gas supply is waning while power station projects for new supplies are being implemented slowly,” the deputy prime minister said.

Dung said “EVN must also focus on investing in transmission systems to bolster the development of renewables.”

The inadequate transmission system is now a bottleneck slowing down wind and power projects though a dramatically rising number of investors have shown interest in such projects following the recent increase in feed-in-tariffs (FITs).

Dung also instructed the Ministry of Industry and Trade to hasten studies for the country’s investment in coal transshipment ports and regasification terminals to support development of gas-fuelled power, and quickly complete negotiations to buy power from overseas.

He also asked EVN and other investors to speed up the delayed construction of major projects like Nhon Trach 3-4, O Mon 3-4, Tan Phuoc, Long Phuc 2-3, Quang Trach, and Quynh Lap.

Vietnamese firms lack the resources for major projects while foreign loans are difficult to get due to government guarantee-related issues.

The regional imbalance in power supply and demand is also a challenge. While the southern region accounts for more than half the demand (the north nearly 40 percent and the central region nearly 10 percent), power is being generated mainly in the north and central region (about 60 percent).

To make it worse, the installation of transmission lines, both the main grid and branches, has been slow and failed to keep up with the pace of power generation, while negotiations to buy electricity from other countries have been going at a snail’s pace.

The installed power capacity is around 48,000 MW. Under the revised Power Development Plan VII, a total of 60,000 MW is expected to be generated by 2020, with coal-fired plants accounting for 42.7 percent followed by hydropower (30.1 percent), gas-fired plants (14.9 percent), and renewables (9.9 percent).

By 2030, the capacity will jump to 129,500 MW, with the ratios of coal and gas-fired power remaining almost unchanged, but renewables doubling to 21 percent.

Energy Cooperation

Vietnamese NA to closely cooperate with Lao counterpart: Chairwoman

6 January 2019

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Vietnam

Hanoi (VNA) – The Vietnamese National Assembly (NA) will closely cooperate with the Lao parliament in continuing to create favourable conditions for the two Governments to effectively implement their bilateral agreements, NA Chairwoman Nguyen Thi Kim Ngan affirmed on January 6.

During a reception in Hanoi for Lao Prime Minister Thongloun Sisoulith who came for the 41st session of the Vietnam – Laos inter-governmental committee, Ngan further said she hopes the implementation of the key projects between the two countries on energy and transport will be accelerated. Especially, the quality and tempo of the construction of the Lao National Assembly office should be ensured, she stressed.

The guest briefed his host of the outcomes of the session which he co-chaired with Vietnamese Prime Minister Nguyen Xuan Phuc earlier the same day, during which the two sides highly valued the achievements recorded in 2018, exchanged ideas on the difficulties and affirmed their determination to boost up the cooperation in 2019.

At the session, the two sides signed six cooperation minutes, affirming that they will actively collaborate to prepare for important projects between the two countries, the Lao leader highlighted.

Chairwoman Ngan spoke highly of the outcomes and stressed that the NA supports the Vietnamese Government in intensifying its cooperation with the Lao Government. The law-making body will continue its supervision so as to accelerate the implementation of the agreements between the two sides, she said.

The NA leader rejoiced at the great achievements recorded by Laos during the recent past and expressed her belief that under the leadership by the Party, the management by the Government and the supervision by the National Assembly of Laos, the country will reap greater successes.

Host and guest also shared important experiences in law-building work and the holding of the confidence votes on officials elected or approved by the National Assemblies. They expressed their belief that the traditional friendship, special solidarity and comprehensive cooperation between the two countries will continue to be deepened, spanning from the fields of politics, diplomacy and security-defence to culture, education, human resources training, health care, tourism people-to-people exchanges.-VNA

Energy Economy ,
Others

Red Dot Power exits electricity market in Singapore

5 January 2019

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Singapore

Red Dot Power has pulled out of the electricity market, saying yesterday that it has been a “financially challenging period” for the firm.

The company was part of the initial soft launch for the open electricity market (OEM) in Jurong, signing up around 3,000 customers, including 120 households.

When the open market roll-out to other parts of the island began on Nov 1, Red Dot Power decided not to sign up new customers as it evaluated its business.

Now, it has decided to exit the OEM, and its customers’ electricity accounts will be transferred back to the SP Group on Monday.

Its departure leaves 22 electricity retailers in Singapore, of which 13 will continue to participate in the OEM’s nationwide launch.

“We are working closely with Red Dot Power to ensure a smooth transfer of its customers, mostly commercial and industrial consumers, to SP Group as part of the standard process for retailers who are exiting the business,” said a spokesman for the Energy Market Authority (EMA).

Red Dot Power was one of 13 retailers which took part in the pilot in April last year of the OEM in Jurong. Experts believe it fell victim to a price war among retailers, which are offering big discounts and attractive freebies to get customers to switch from SP Group.

In September, Red Dot Power was offering residential plans of 19.08 cents per kwh, while some retailers were offering as low as around 17 cents. Red Dot’s customer base of 3,000 to date is below the 10,000 some retailers have secured.

Professor Subodh Gautam Mhaisalkar, executive director of the Energy Research Institute at the Nanyang Technological University, believes Red Dot’s exit is likely to be part of a process of consolidation in the market.

He said: “Being an electricity retailer is still a long-term viable business opportunity for companies, and with multiple companies also in the business, one company bowing out does not raise a red flag.”

Yesterday’s announcement surprised some customers.

Ms Daphne Koh, 26, whose family of three in Jurong has a subscription plan with Red Dot, said: “I don’t appreciate that the services were halted so quickly. I hope the prices other retailers provide won’t be far beyond what we pay now.”

Red Dot has assured customers that their power supply will not be disrupted. “We are working closely with the EMA and SP Group to ensure a smooth transfer,” said its chief executive Vijay Sirse.

He also assured customers they would not be required to pay any early contract termination charges.

Customers with security deposits held by Red Dot will have the money used to offset their latest electricity bill. The remaining sum will be refunded no later than one month from the date of the final invoice.

The EMA spokesman said that several safeguards are in place when selecting retailers to participate in the OEM. “Even if a customer’s retailer exits the business, their electricity supply will not be disrupted and their security deposits will be protected by business insurance or banker’s guarantee.”

The OEM was conceptualised as a way to enable households and businesses to buy electricity produced by power plants through a retailer with a price plan that best meets their needs.

EMA said about 30 per cent of residents in the areas where the OEM is under way have switched to retailers other than SP Group.

Oil & Gas ,
Others

Singapore light distillate fuel stocks hit record high

4 January 2019

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Singapore

SINGAPORE, Jan 4 (Reuters) – Light distillate fuel stocks at Asia’s refining hub in Singapore have climbed to a record on surging supply, just as fears emerge of an economic downturn heading into 2019.

Light distillate stocks in Singapore, which include the key transportation fuel gasoline and important petrochemical feedstock naphtha, rose by 1.47 million barrels in the week to Jan. 2, to a record 16.1 million barrels, according to data from Enterprise Singapore released on Friday.

The record comes on soaring supply from refineries across Asia, including China where exports have surged amid a broad expansion of the country’s refining capacity.

Weighed down by excess supply and sluggish demand, gasoline producers began losing money from gasoline after Asia’s benchmark gasoline margin GL92-SIN-CRK in December turned negative. The benchmark has since recouped some losses.

Traders said a slowdown in economic growth and, by extension also in fuel and petrochemical consumption, could keep inventories elevated.

“If factory utilisation rates fall, then purchases of raw materials like petrochemical feedstocks will also weaken,” Singapore-based shipping brokerage Eastport said on Friday.

Data for December from the Institute for Supply Management (ISM) on Thursday showed the broadest U.S. slowdown in growth for more than a decade, as the trade conflict with China, falling equity prices and increasing uncertainty started to take a toll on the world’s biggest economy.

Leading economies in Asia and Europe have already reported a fall in manufacturing activity.

Reporting by Roslan Khasawneh and Henning Gloystein Writing by Henning Gloystein Editing by Kenneth Maxwell

Electricity/Power Grid

Indonesia realizes 98.3 pct national electrification ratio

4 January 2019

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Indonesia

JAKARTA, Jan. 4 (Xinhua) — Indonesian Energy and Mineral Resources Minister Ignasius Jonan said on Friday that the electrification ratio among the population has reached 98.3 percent in 2018, showing a continuous ratio growth since the current government started to function in 2014.

“It is hoped that the ratio would grow further to 99.9 percent this year,” the minister said at his office.

The highest national electrification ratio recorded last year has peaked the ratios in previous years that stood at 95.3 percent in 2017, 91.2 percent in 2016, 88.3 percent in 2015 and 84.3 percent in 2014 respectively, he added.

Most of the electrification ratio was supported by electricity supplies from state-run power firm of PLN with 95.45 percent and from other power suppliers with 2.48 percent, he said.

The ministry has set a target to boost a total capacity of power plants operating in the country up to 80,000 Mega Watt (MW) this year from 63,000 MW last year.

Electricity/Power Grid

Electrifying Myanmar

4 January 2019

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Myanmar

Since sanctions by the United States (US) and European Union (EU) were lifted, Myanmar has enjoyed relatively strong economic growth. According to the Economist Intelligence Unit (EIU), Myanmar’s economy has grown at an average of 7.5 percent between 2012 and 2017. Its economy is slated to accelerate further, driven by a spike in private and public investment and aggressive consumer spending.

However, for Myanmar’s economic ambitions to come to fruition, it must first solve its energy challenges – primarily, in meeting the demand for power.

Myanmar’s electrification problems

According to the Asian Development Bank (ADB), between 2000 and 2012, electricity demand in Myanmar grew by 9.8 percent year-on-year and will continue to grow at a staggering pace. Estimates by the Japan International Co-operation Agency (JICA) – Myanmar’s largest source of official development assistance (ODA) – places electricity demand at approximately 15 gigawatts (GW) by 2030. That translates to a fivefold increase from current levels. Myanmar’s existing installed electricity generation capacity is five GW although its peak capacity is only half of that, at 2.5 GW.

Besides powering burgeoning industries, the increase in electricity demand is also due to Myanmar’s attempt to bridge the electrification gap. For a nation blessed with a wealth of electricity-generating resources, electrification and electricity usage rates are woefully dismal. As it stands, 65 percent of its citizenry do not have access to the national grid. Per capita usage of electricity was just 217 kilowatt hours (kWh) in 2014 according to World Bank numbers – the lowest amongst all member states of the Association of Southeast Asian Nations (ASEAN).

While efforts are taken to bridge this gap, energy demand will continue to surge.

Source: Various sources

Between hydropower and natural gas

Under the National Electrification Plan, Myanmar has set a goal of 50 percent electrification by 2020 and 100 percent by 2030.

The most obvious solution, is to harness the abundance of hydropower available in the country. The ADB estimates this to be in excess of 100,000 megawatts (MW) in terms of installed hydropower capacity.

Dams are already the primary source of Myanmar’s power generation at approximately 60 percent. There are currently 26 state-run hydropower plants in operation with a total installed capacity of 3,181 MW. Another five – a number of which are mega-dams (over 1,000 MW) – are slated for construction but are all currently facing delays.

Hydropower may suffer drawbacks due to the damming of rivers which may affect the livelihoods of people dependent on the water source. For example, the projects which would dam the Irrawaddy and Salween rivers have come under severe criticism by environmental rights groups who claim it would affect downstream land fertility and significantly impact the income of the local people.

The government of Myanmar has turned its focus to natural gas but gas production in existing oil fields are declining. There are fields that are in the early stages of exploration but won’t be ready until after 2020. This leaves the government with a 10-year deficit of gas supply which it must fill if it intends to rely on gas for electricity production. Myanmar’s Ministry of Electricity and Energy (MOOE) has announced plans to commission a liquified natural gas (LNG) terminal which would provide a huge chunk of gas intended for electricity supply until the fields are ready.

Source: Various sources

Government inexperience and a solar answer

As the country attempts to quench its thirst for electricity, it indirectly opens up room for investment. However, a recent report by The Economist revealed that government inefficiencies often hinder the development of the energy sector in Myanmar.

The MOOE has little experience with public-private partnerships – especially negotiations with foreign investors – as most electrification initiatives are state-run. Besides that, bureaucracy is also to be blamed.

The report also highlighted a mismatch of expectations between government and independent power producers (IPPs). IPPs often approach governments, expecting some sort of guarantee as they undertake such large financial commitments.

“To date, the government has been reluctant to take these steps, resulting in IPPs unable or unwilling to secure the finance without government support, while government counterparts search in vain for completely independent power suppliers,” the report stated.

The door has not completely closed for Myanmar. Its electrification goals can still be attained. But that would require the government to shift its posture on engagement with IPPs and to diversify its sources of energy.

Solar is a likely option. Two projects exceeding 150 MW are currently being constructed and should be monitored as “demonstration projects.” Given that the cost of solar generation has fallen, herein lies an opportunity for Myanmar to bridge the gap in its energy needs. The growing trend of corporate power purchasing agreements (PPA) and projects that are directly financed via long-term contracts with the private sector, is a carrot for solar energy producers as they are not currently impacted by tariffs or subsidy issues.

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