The Government of India reduced natural gas prices by 16% for the next six months. Andhra Pradesh aims to increase its installed power capacity to 29,000 MW by 2019 by adding over 18,000 MW of new generation capacity from various sources like thermal, hydro, solar and wind. Lanco Infratech plans to sell at least 3,000 MW of power assets to reduce its debt of INR 18,000 crore. NTPC will commission the first 800 MW unit of its 4,000 MW Lara thermal project in Chhattisgarh by the fourth quarter of 2016.

1. Policy News
 Government cuts natural gas prices 16 percent
The Government of India reduced natural gas prices by 16 percent for the six-month period, from
October 1, 2015 to March 31, 2016. From October 1, 2015, the new gas price on net calorific value basis
will fall to USD 4.24 per million British thermal units (Btu) from the current USD5.50 per million Btu.
During the same period the new gas price based on gross calorific value would be USD 3.80 per million
Btu from the current USD 4.66 million Btu. Producers such as Oil and Natural Gas Corp (ONGC) and
Reliance Industries’ revenue depend on the price cut. However, users in the power and fertiliser sector
will gain on lower feedstock cost. The government has approved a mechanism in October 2015, which
includes revising domestically produced natural gas after every six months, using weighted average or
rates prevalent in gas-surplus geographies of Canada, the US/Mexico and Russia. Over the next six
months, price rate will be based on average prices during July 1, 2014 to June 30, 2015.
 RBI, Central and State governments to revive distressed power utilities
The Reserve Bank of India (RBI) is working with the Centre and the state governments to revive sick
power distribution companies with healthy capital structure and reduced debt, along with appropriate
interest rates. Both, the governments and the RBI, are concentrating on the problem and resolution of
the discom issue. All the bodies plan to move the power tariffs to a point where the discoms are feasible.
 Andhra Pradesh to achieve 29,000 MW installed capacity
The Andhra Pradesh government is targeting 29,000 MW installed power capacity by 2019, as compared
to the current capacity of 10,222 MW. The state will achieve this by adding generation capacity of nearly
18,230 MW, which includes 7,090 MW of thermal, 1,010MW of hydel power, 4,530MW of solar,
4,000MW of wind and 1,600MW of CGS. During the same time, the demand for power is expected to
increase to 13,500 MW, while the present power demand is 6,200 MW. Power requirement of the state
will cross 80,000 million units as against the present 43,000 million units.
Industry News
 Lanco to sell 3,000MW power assets
Lanco Infratech announced that it plans to sell at least 3,000MW of power assets in FY2018 to fetch an
enterprise value of INR 25,000 crore. The infra firm has a debt burden of INR 18,000 crore. It received
some respite when lenders approved cost overruns of around INR 33,000 crore for 4,036MW of power
projects. The company sold the 1,200MW Udupi thermal power project in April 2015. It has 3,460MW
operating power assets. Lanco's revival is linked to the successful execution of projects under
construction. The company has 3,460mw of operating power assets from gas, hydro, coal and solar. It is
planning to take its total operating capacity to over 8,000MW by FY2018 by building 4,636MW projects.
© Gyan Research and Analytics Pvt. Ltd., 2015 1
Energy News
September 26, 2015 – October 2, 2015

2. © Gyan Research and Analytics Pvt. Ltd., 2015 2
 NTPC to start Lara thermal project in Chhattisgarh
The country’s largest power producer, NTPC Limited plans to roll out its 4,000MW Lara thermal project in
Chhattisgarh by FY2017. It will commission the first 800MW unit in 4Q2016 . The total project cost is
estimated at INR 30,000 crore. Power generated from this project will be supplied to Maharashtra,
Chattisgarh and Goa. NTPC has inked a memorandum of understanding (MoU) with the state government
to supply coal from the Talaipalli mine in the Lara project. The company has a total installed capacity of
45,548MW, another 23,000 MW capacity under construction and around 9,500 MW is up for bidding.
 Sterlite Grid, Burns & McDonnell to implement transmission projects
Sterlite Grid has tied up with US-based Burns & McDonnell for implementing world-class engineering and
construction methodologies to transmission projects in India. The companies together will apply
innovative designs and mechanised construction including Heli-crane construction, micro-pile
foundations and special tower designs for rapid commissioning of projects. The initial effort will be to
strengthen the link between Punjab and Jammu & Kashmir on the 'Northern Region Strengthening
Scheme' project (NRSS 29). This project will carry 2,000 MW power to the Kashmir’s energy starved
region valley from the power-surplus Punjab. Sterlite Grid will invest around INR 3,000 crore, comprising
400 kilovolt (kV) gas insulated substation and 900 circuit kilometres of transmission lines at
Amargarh. The company targets to complete this 50-months project in less than 40 months. This
partnership will help the company to achieve its goal by bringing cutting edge technologies to India.
 PGCIL builds 450MW transmission line linking West Bengal, Bihar
Power Grid Corporation of India Ltd (PGCIL) is constructing a 450MW capacity transmission line between
West Bengal and Bihar, worth INR 800 crore, to enhance electricity supply infrastructure. The line, built
between Rajarhat in West Bengal and Purnia in Bihar, will be completed by March 2017. The company
has 30 acres of land at Rajarhat for the sub-station. The transmission line will help to evacuate power for
NTPC’s power projects in Farraka and Kahelgoan. PGCIL is also carrying out renovation activity of several
lines. It has modernised the Malda-Farraka line with new conductors, which will increase capacity by 1.5
times.
 GIPC signs deal for subsidized imported gas
Gujarat Industries Power Company (GIPC) has inked deals with the Power Ministry under the Power
System Development Fund (PSDF) support scheme (Phase II) to receive domestic gas in gas based power
plants. It signed power purchase agreements on September 30, 2015, for subsidy to purchase expensive
imported gas, which will help it to produce and supply 17.59 million units of electricity during the October
1, 2015 to March 31, 2016 period. The company has also signed a deal with GAIL to supply 39.61 million
units of electricity.
Energy News
September 26, 2015 – October 2, 2015

3. © Gyan Research and Analytics Pvt. Ltd., 2015 3
 ABB completes Phase I of North-East Agra transmission link
ABB India Limited has completed the first phase of the North East - Agra 800 kilovolt (kv) ultra-high
voltage direct current (UHVDC) transmission link. This transmission link will supply hydro-power from
north-eastern India to a related sub-station in Agra, and from Agra to parts of North India. It will address
the power shortage in North India by transporting electricity upto 1,500 MW from hydropower
generated in the mountainous North-East, across 1,728 kilometres. ABB aims to commission the link fully
by 2016. It will be the world's first multi-terminal UHVDC connection, capable of transmitting enough
electricity to serve around 90 million people. The company is executing the project along with Bharat
Heavy Engineering Ltd (BHEL) on a turnkey basis.
 Essar Oil to produce 1.2 million SCMD from Raniganj
Essar Oil is targeting 1.2 million Standard Cubic Meters Per Day (SCMD) of gas production from the
Raniganj coal bed methane asset, in the coming next few months. The company aims to produce 3 million
SCMD overall, by May 2016. It has already started working on high quality infrastructure in-field and last
mile pipeline connectivity network is already in place. Essar is currently in the middle of a routine
turnaround shutdown, which will conclude in October. During this time, the company is planning to
convert its existing vacuum gas oil hydro treater unit to mild hydrocracker unit, which will enable it to
convert lower margin vacuum gas oil to high value distillates. It is also planning to expand retail network
to 5,000 operational outlets over the next two years .
 Inox Wind ties up with GMDC
Inox Wind has bagged a 50 MW wind power project from the Gujarat Mineral Development Corporation
(GMDC). Under the contract, Inox will provide and install 25 units of 2MW double fed induction
generators (DFIG) with 100 rotor dia Wind Turbine Generators (WTGs) for the state corporation. GMDC is
contracting with Inox Wind for the first time. The project will be part of Inox Wind Park’s 400MW capacity
at Rojmal. Under this partnership, GMDC will provide sustainable, clean and renewable power, while
energy solution provider, Inox will handle the complete project lifecycle including building the power
evacuation system, acquiring land, wind resource assessment, developing the entire site infrastructure,
erection and commissioning services, supplying the WTGs as well as providing long-term operations and
maintenance services to GMDC.
 Diesel rates hiked 50 paise per litre
Diesel price has increased by 50 paise per litre. From September 29, 2015 it will cost INR 44.95 per litre as
compared to the current INR 44.45 per litre. The last revision took place in September, when rates were
lowered. The current level of international prices and INR-USD exchange rates permit a price increase,
which has been passed on to the consumers. However, there will be no change in petrol rates.
Energy News
September 26, 2015 – October 2, 2015

4. © Gyan Research and Analytics Pvt. Ltd., 2015 4
 NTPC awards Jharkhand coal block
NTPC has awarded the Pakri-Barwadih coal deposit contract to a joint venture (JV) between Thriveni
Earthmovers and Sainik Mining. The JV will develop and operate a 15 million tonnes per annum mine. The
contract is worth INR 27, 000 crore. Thriveni holds 51 percent of the venture, while Sainik Mining holds
the rest. The JV will be participating in other similar opportunities with Coal India, SAIL and NTPC. It aims
to start production by 2016.
Investment news
 Jaiprakash Power pays USD 75 million to JSW Energy
Jaiprakash Power Ventures Ltd has paid an additional USD 75 million to JSW Energy for selling securities
of its subsidiary Himachal Baspa Power Company Limited (HBPCL). Untill March 31, 2015, the company
had paid USD 50 million to JSW Energy. Previously, the company’s Baspa-II and Karcham Wangtoo Hydro-
Power Plants were transferred and vested with its arm HBPCL.
 Oil companies pay USD700 million in oil dues
Essar Oil, Mangalore Refinery and Petrochemicals Limited (MRPL), HPCL-Mittal Energy (HMEL) and
Hindustan Petroleum Corp (HPCL) have paid USD 700 million to Iran. The amount is one-tenth of the
outstanding oil dues owed by these companies. Of USD 700 million, Essar Oil has paid USD 335 million,
while MRPL has paid nearly USD300 million, HMEL and HPCL have paid the remaining amount. The
second installment worth USD 700 million will be paid by November, 2015. Earlier, the US Treasury's
Office of Foreign Assets Control (OFAC) had approved the payment of USD 1.4 billion by Indian refiners,
through banking mechanism, in two equal installments to Tehran. Kolkata-based UCO Bank transmitted
the money to the Reserve Bank of India (RBI) and the RBI would make the arrangements to send to Iran.
When the payment channels are approved, the remaining USD4 billion will be cleared in tranches. In
2014, the oil companies had paid about USD 3 billion in six installments through a limited payment
channel. Previously, Essar Oil owed USD 3.34 billion, MRPL USD 2.49 billion and Indian Oil Corporation
USD 581 million, HPCL USD 29 million and HMEL owed another USD 97 million to Iran.
Energy News
September 26, 2015 – October 2, 2015

5. © Gyan Research and Analytics Pvt. Ltd., 2015 5
Weekly Snapshot
Source: CEA
Energy News
September 26, 2015 – October 2, 2015
Import of Coal Target for the year 2015-16 for blending with Domestic Coal
Board/Utility Annual Target of Imported Coal (million tonnes)
HPGCL 1
PSEB 0.5
RVUNL 1.8
UPRVUNL 0.5
MPPGCL 1.2
Torrent AEC 0.4
GSECL 1
MSPGCL 5.2
Relinace (Dahanu) 0.6
VIPL(BUTI BORI) 0.5
AP GENCO 4.4
TANGEDCO 5
KPCL 2
DVC 1
CESC 0.1
Haldia Energy 0.2
WBPDCL 0.4
NTPC 22
NTPC(JV) Ind Gandhi 1.5
Reliance(Rosa) 2
JPL(M.Gandhi) 2.6
LANCO(Anpara) 1.5
VEDANTA(TalwandiSabo) 1.8
J P BINA 0.3
Bajaj Energy 0.1
Sterlite Energy(Jhasuguda) 1.4
NTPC(JV) VELLUR 1.8
ADANI(Tirora) 4.7
NABHA Power 1
MOSER BEAR 1
Emco Energy 0.4
NTPC SAIL 0.3
GMR Kamalanga 0.5
KAWAI 2
TAMNAR 0.5
TUTICORIN JV 0.8
PYNAMPURAM 1
Total 73

6. © Gyan Research and Analytics Pvt. Ltd., 2015 6
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Energy News, September 26, 2015 – October 2, 2015