Wednesday, June 29, 2005

Follow-up on Friedman's Geo-Green Strategy

Here is an interesting post from TreeHugger, especially when seen as a follow-up to the post on Friedman's Geo-Green Strategy. In that post we looked at Friedman's analysis stating that all the technologies to make the US independent of oil imports are already here and only need implementing.

Well the TreeHugger post points to paper that was released to influence the US Senate's debate on the Energy Bill - to try and get subsidies for renewables instead of for fossil fuels. The paper reiterates the same points that Friedman makes - promote plug-in hybrids and bio-fuels. In addition to these points the paper also mentions improving the mileage of all new vehicles (which in case of Friedman's analysis came in as part of using hybrids).

What is interesting though it the TreeHugger comment in the end: "Of course, nothing here is a solution to the end of oil; if implemented, these things wouldn't give us a sustainable post-oil society, but things would still be better than with the current situation...". I hope this was a casual statement and not based on solid costing.

Monday, June 27, 2005

Reliance going green?

In the post titled Reliance's Power Play, which was basically a round-up of Reliance Energy's big ambitions in the power sector in India, I mentioned that given its track record, Realiance was unlikely to go green like Godrej and Ramco for example. Two things happenned after that, that made me reconsider that idea.

The day of the Reliance Split, Anil Ambani was addressing a press conference live on several channels. During what was looking like a great public wooing exercise, he slipped in that REL remains committed to non-conventional sources of energy - and he only mentioned solar and wind. Solar sounds nice, but mentioning wind obviously meant he was serious. Now a lot of Reliance's foray into the energy sector was based on RIL's oil and gas finds. Thus the biggest-of-its-kind gas plant in UP, and a proposal for a bigger one in Maharashtra. The first indication that there was a move away from oil and gas was the proposed Orissa investment in coal. So this made great sense. REL is moving away from RIL, and a future linked closely to oil and gas, which is no longer "in-house" so to say. Thus it was logical to move into wind. (Actually non-conventional sources were also mentioned at the REL AGM slightly earlier in the month too).

Next came the announcement today, that Reliance Energy and GE were setting up India's largest wind power project at 500 MW capacity, by 2007. So does this speak of a new leaf.

Not entirely. As part of the Electricity Act 2003 the government of India mandated that all power distributors ensure that a certain percentage of their power comes from renewable sources, and that just might have forced Reliance's hand. Also, despite the size of the investment relative to others in the industry, it would provide a very small percentage of the total power Reliance plans to produce and/or distribute in the near future.

Sunday, June 26, 2005

Anayzing India's Biggest* Gas Discovery


It was a well-contested block, when it was put up for bidding "way back" under NELP-III (third round of National Exploration Licensing Policy). The last date of submission of bids was 28th August 2002, while Reliance announced their find only in November 2002. Going by industry rumour, that find was originally ONGC's. Even discounting that rumour, it is very likely that having already explored the area both Reliance and ONGC knew the area very well. Thus the winning bid was a surprise. For the record, ONGC and Reliance are likely to win all K-G Basin blocks on offer under NELP-V.

Drilling operations started on July 31, 2004. After abandoning the first two wells at depths between 2600 and 2900 m, the third well was spudded on January 17, 2005. The reserve was confirmed at a depth of 5,061 m.

Venture Partners

Joint ventures are usually the norm in the upstream oil sector. So GSPC is actually a part of a consortium and owns 80% of it. The rest is held by GeoGlobal Resources of Canada and Jubilant Enpro of Noida, India. The smaller partners generally bring in expertise and are likely to sell out by the time production is commercialized.

Future Plans

News reports claim that GSPC wants to get the gas onshore by 2007. Reliance plans to start production in August 2006, though they started out over 2 years ago. But then drilling three wells of those depths within 300 days is also a record of sorts. To commercialise production, GSPC needs Rs 1,500 crores and an IPO is planned (expect a stampede soon!). Currently the Gujarat government owns 99% of GSPC, while a British Gas subsidiary Gujarat Gas owns the remaining 1%. The government is likely to divest 20% of the company within 6 months. GSPC had been earmarked for divestment even before this find.

GSPC intends to drill four more wells, and tenders have already been floated for these. Drilling is scheduled to start after the monsoons.


This find can have likely impact on a range of gas deals for India from the proposed pipelines to LNG import to domestic pricing. Need to do some research (or find a news article with figures I can simply validate!), but I'll be back on this, hopefully, soon.

* While most media reports seem to agree that this is India's biggest find ever, this report from ET states that the Bombay High find (Vasai offshore), way back in 1976 was still bigger at 22-24 tcf. But even ET agrees that it is probably the biggest find in the world in the new millenium.

India Petroleum Update

India's Biggest Gas Find

The Krishna-Godavari Basin, that threw up the 14 trillion cubic feet (tcf) gas field for Reliance in 2003, has done it again - this time for relatively puny old Gujarat Petroleum. To be honest, GSPC has been attracting a lot of media interest of late, but nothing can beat this $50 billion addition to its asset list. The gas find is worth about 20 tcf, which is two thirds of Bangladesh's proven reserves.

As more details of the reserves pour in, it should be interesting to note the worth of the oil leg in this find, which could be decent too.

The Gujarat CM, Narendra Modi, revelled while announcing this to the press a short while ago, and went on to name the project, "Deen Dayal" or "Saviour of the poor".

Doubts are already being cast on the viability of the scheduled incoming pipelines. Similar doubts were cast after the Reliance find too - even then though the Reliance group itself remained firmly in favour of the pipeline.

Domestic Petro-product Pricing

The other big happenning this week was the price hike of petroleum products. Petrol was made dearer by Rs 2.50, and diesel by Rs 2.00.

As volatile as that decision to increase prices was, petrol pump owners were not impressed. They went on strike demanding higher commissions - which would naturally have to passed on to the consumers.

Gas for Dabhol

With the Dabhol plant all set to resume operations, India is now looking towards Qatar for additional supplies of LNG. This is in addition to the 5 mtpa Qatar is already supplying, and the additional 2.5 mtpa for which negotiations are in progress.


After Bangladesh, illegal diesel imports are finding their way into India now from Nepal.

Friday, June 24, 2005

Freeing India of Oil Imports

After the post based on Friedman's article on reducing American dependence on imported petroleum, here is one on reducing Indian dependence on imported oil and gas altogether.

This was written by Arun Firodia, Chairman of the Kinetic Group, and was published last December. The article envisions an energy independent future for India based on methane gas from cow dung (from our 250 million cows), and bio-diesel from massive Jatropha plantations.

Weight-wise methane gas matches the calorific value of petrol, LPG or kerosene, and an average cow in India can produce enough dung to produce 225 litres of methane gas in a year.

Replacing LPG and kerosene

Estimating a per capita annual LPG and kerosene consumption of 15 kg each, for the urban and rural populations, just 75 million cows would produce enough methane (16.8 billion litres) to meet the LPG and kerosene requirements of 1 billion Indians (15 billion litres).

Replacing Petrol

40 million cows can produce enough methane to easily replace the 8 million tonnes of petrol India consumed in the year 2003-2004. Like CNG, methane can easily replace petrol in automobiles.

What about Diesel?

Jatropha! on just 15 million of our 25 million hectares of waste or fallow land, will produce at least as much bio-diesel as India's annual consumption of diesel.

All figures are from the original article. Though the figures seem exhaustive, and the article also gives more insights into the production of methane gas (or gobar gas) there isnt enough dwelling on the costing factors, which at least in the case of bio-diesel is still critical. The point being made is very valid. Imagine the potential for a country like New Zealand which has far more lifestock than human beings!

Update: Indra had posted on this article some time back. Some useful comments are available on his site.

Thursday, June 23, 2005

Friedman's Geo-Green Strategy

Sunil pointed me to this excellent editorial by New York Times Op-Ed columnist, and much celebrated writer, Thomas L. Friedman.

Outlining what he calls geo-green strategy he talks of ridding the American economy of its addiction to and dependence on oil. Most importantly he states that the technology to that utopia is already available, and a lot of it has already been commercialized successfully.

Plug-in hybrids can ensure that 50% of Americans do not use petrol at all for their daily use. Those that do will get a mileage of 100 miles per gallon (210 kmpl). Step two would be using flex-fuel cars that can run on ethanol, petrol or any combination of the two. So a hybrid running on an 80-20 mix of ethanol and gasoline will practically give 500 miles for every gallon of gasoline.

As Friedman puts it, "In short, we don't need to reinvent the wheel or wait for sci-fi hydrogen fuel cells. The technologies we need for a stronger, more energy independent America are already here. The only thing we have a shortage of now are leaders with the imagination and will to move the country onto a geo-green path."

Tuesday, June 21, 2005

Energy Independence via Swadeshi

Gandhiji's Swadeshi movement broke the economic back of British Rule in India. The essence of the movement was that everyone invest a little time everyday to make whatever cloth they needed, and hence close the market for British textiles in India. The closure of the giant Indian market led to the shutting down of mills in England, but more importantly the poor Indians felt a little more self-sufficient, self-reliant and a little richer too.

In an excellent post, Gmoke points out that, "this type of practical labor has to be the core of any sustainable ecological action".

Look at it this way. Gandhi used swadeshi, as what we shall call Sustainable Ecological Action, to make cloth, which in some ways was the life blood of the economy then. In the different world that is today, what cloth no longer has that position. So what does? In a lot of ways it has to be energy. Fossil fuels like oil, coal and natural gas, and renewables like solar, hydel, tidal and wind - all of these have only one thing in common - they give energy. And without energy their importance reduces to almost nothingness. So if Gandhiji were to start a Swadeshi today, he would choose to create energy instead of cloth.

Here is what Gmoke suggests:

In this "deregulated environment" with oil used as a weapon and national security identical to energy security, direct ecological and economic action toward renewables and away from the nuclear, gas, coal, and oil that we presently use can be a primary political as well as economic act. A treadle/pedal/crank powered generator with a flywheel can be the solar swadeshi, an ecological and economical electrical charkha.

One humanpower is about one sixth horsepower. A healthy person can put out 100 watts of power for hours on end and 300 watts in a sprint. Let's not be batteries in the Matrix but generators in a net metered ecological Network.

The ultimate goal I envision is to meet all electrical non-space-heating and refrigeration needs within the space of one south-facing window (4-10 square feet of photovoltaics) and a half hour to an hour a day's human power. The realistic goal today is most of the electrical load with the exception of refrigeration and space-heating: lighting, TV, audio, computer, phones...

This isn't Edward G. Robinson in "Soylent Green" pedalling a broken down three speed to light one sickly incandescent bulb. This is more like Lance Armstrong powering his energy efficient Spanish villa with a morning workout on his state of the art Tour de France simulator stationary bike and power generator.

Sunday, June 19, 2005

India Petroleum Update

The Indo-Iran LNG Import Deal

The big deal was finally signed. Here is a quick reckoner for those interested in the line item details.
1. A consortium of state-run firms are representing India, while the National Iranian Gas Export Company (NIGEC) is representing Iran.
2. Iran will sell India 5 million tonnes of LNG every year for 25 years starting 2006. The size of the deal would be between $18 to $22 billion. Discussions for an additional 2.5 million tonnes per annum (mtpa) were postponed to, "after the polls".
3. At $3.515 per mmbtu, the price is 26% higher than the price fixed with Qatar, while the price of oil has almost doubled in the time between the two deals. The gas from Qatar however is rich gas, which Iran has a policy of not exporting. Though the Iranian gas will not be stripped of ethane before export, it is still not clear if the gas will be stipped of other chemicals or not.
3. ONGC Videsh Ltd gets full operatorship of the Juffier exploration block, though only 10% of Iran's biggest producing field - Yadavaran. The deal is worth 60,000 barrels per day to India. Another 10% could be given after the discussions on the additional 2.5 mtpa are complete. The initial deal suggested was that India would pay market price for this oil, and I am not sure that has changed - in which case it is a very minor victory indeed.
4. IOC-OVL get an exploration block in the possibly very rich North Pars gas field.
5. IOC will team up with Iranian Petropars for an LNG and petrochemical complex. IOC is also pushing for another 9 mtpa deal with Petropars.

The Indo-Iran Pipeline Deal

The "heads of agreement" has been signed. An official level special joint working group has been set up by India and Iran, to thrash out financial, technical, legal and commercial issues. The first meeting will be in New Delhi on June 23-24. The Indo-Pak joint working group (formed this month) will meet in New Delhi in July.

Once again, the inclusion of China in the Indo-Iran pipeline project was discussed. Extending the pipeline beyond India, and especially into China is wonderful for two reasons: India gets transit fees to easily offset the transit fees being paid to Pak, and energy security is enhanced, as Pak would hardly dare cut supplies to China even in case of hostilities with India. On the face of it, all parties have expressed willingness to go ahead at various levels.

Scenting the NELP-V winners

Phoenix Overseas, a near unknown in the oil industry, and better known as an arm of Phoenix shoes, might win one of the most prospective blocks under NELP-V. The block in Rajasthan is spread in three districts, and Phoenix was quizzed on its proposed drilling details under the exploration program. This is seen as a strong indication.

Otherwise the status remains the same - ONGC is likely to win 10 out of 20, while Reliance will get at least 2, and maybe even 9.

Though it is likely to draw a blank under NELP-V, the world's largest oil and gas company, Total might enter the refinery sector in India in a big way, en route a retail entry. More correctly the refinery entry is near mandatory to enter the retail sector.

Cairn continues to trumphet its commitment to the Indian oil exploration story by saying that it hopes to, "discover and land several billion barrels of oil", in Rajasthan. Maybe it was just euphoric over this. Good for us anyway.

Tuesday, June 14, 2005

From Greenhouse Gasses to Oil

The Kyoto Protocol mandated cuts dictate a cut in emissions - not a cut in production - of greenhouse gasses. Some countries are thus planning to collect the CO2 being produced by their industries, and store it under ground.

Citing the experience of Norwegian firm Statoil which has been storing CO2 below the seabed in a gas field, Britain believes doing this could cut upto 85% of emissions from power stations, and wants to help other countries adopt this technology too as and when it is available.

"The move comes as Britain prepares to put climate change issues center stage at next month's G8 Summit at Gleneagles in Scotland."

The technology is expected to be available in a decade. Further pumping in the gasses into depleted oil and gas fields is also likely to increase yield from the fields.

This is a good initiative. While it is not a pure-play clean-green technology, being as far as we are from Utopia we have to cling on to as many logs as we can. Energy efficiency is one. This is another.

Brazil's Huge Experiments with Bio-fuels

GCC links to this article in the BBC titled, " The rise, fall and rise of Brazil's biofuel". The history of bio-fuel usage in Brazil presents an excellent case study for economies (including India) that are today trying to move towards bio-fuels in a big way.

The Rise

In a politically inspired decision, Brazil's military dictatorship decided to reduce dependence on Middle Eastern oil (probably as a reaction to the oil price hikes in the 1970's). Thus was started a program to use ethanol made from sugar-cane, which was plentiful in Brazil, as a substitute for petrol in motor vehicles. The program subsidised farmers for growing sugar-cane, subsidised ethanol at the pumps to actually make it cheaper than petrol and ensured mass production of vehicles that ran on ethanol instead of petrol.

"As a result, in 1985 and 1986, more than 75% of all motor vehicles produced in Brazil - and more than 90% of cars - were designed for alcohol consumption."

The Fall

Then a combination of factors brought down the curtains on this major technological feat. The military government fell in 1985, and so did concerns of "national security". Oil prices fell steeply from their 1970's highs, while sugar prices rose (making ethanol also more expensive), and finally Brazil discovered huge internal reserves, thus vastly enhancing oil self-sufficiency.

Despite the great environmental benefits, production of ethanol powered vehicles fell to just 0.06% of production in 1997.

The Resurrection

That was about when ethanol and bio-fuels in general were getting popular in the US, encouraged by President Bush's vision to grow fuel instead of digging for it. This was of course helped by the fact that oil prices were rising steadily.

The big technological break came in 2003 when flex-fuel cars entered production in Brazil. Flex-fuel cars can run on petrol, ethanol or any blend of both, aided by an on-board computer that monitors the quality of the fuel and makes appropriate adjustments.

"In 2004, the first full year that "flex-fuel" cars were on sale, they accounted for more than 17% of the Brazilian market, and are on course for an even bigger share this year."

Appropriately more companies are adding flex-fuel cars to their offerings, and they are not all local companies.

The good news is other countries, including the US, are beginning to give Brazil a tough fight for its leadership in the crop-based motor fuel space. Like in any other renewable energy source, the bio-fuel resurgence in Brazil was a result of tax breaks and technological advancement - the tax breaks do the hand-holding till the technology is mature and strong enough to fend for itself.

Monday, June 13, 2005

Eliminate Garbage, Produce Oil

We have seen Power from Garbage initiatives before, but nothing on this scale for sure.

Via Trends... and Joe Kissel:

US company Changing World Technologies, has managed to make Thermal Depolymerization work to produce oil, using the same process that nature takes some millenia to, in a few hours. In nature, organic matter is subjected to high temperatures and pressure, and knowing this process lots of folks have replicated this model in the laboratory. The difference is till now it has not been const-effective. Changing World Technologies claims that their method can produce oil cheaper than drilling it from the ground.

The process takes any sort of organic waste, from biomass and sewage, to plastic and rubber (even tyres), and produces a vaporous gas (a mixture of methane, propane, and butane), liquid oil (similar to a mixture of gasoline and motor oil), and powdered carbon. So you have virtually no waste products.

Not all implications of this technology are clear though. It will take some detailed studies to predict whether it can replace petroleum altogether in major economies. If it can, then it might actually be a big blow against clean renewable sources, rendering them almost forever uncompetitive. Either way, it will still be a great way to treat garbage in cities, and use it to reduce dependence on fossil fuels.

Sunday, June 12, 2005

India Petroleum Update

After Encana in Equador, its Pogo in Thailand, where India's ONGC Videsh Ltd is pitted against a Chinese consortium for buying oil assets. On stake in Thailand are assets worth $700 million.

IOC meanwhile has bid for controlling stake of Turkey's biggest refiner Tupras. While it does not have great mineral assets, Tupras falls nicely into the Indian PSU's strategy by allowing IOC to use its transportation and logistics infrastructure for getting oil and gas from countries in the region that it has tie-ups with.

Aiyar in Pak

On Oil minister Mani Shakar Aiyar's recent trip to that country, Pakistan was offered discounted diesel, an offer that was later enhanced to include other petrochemicals like those used to make polyester fibre and for detergents. On its part Pakistan agreed to review the diesel import policy, "when it comes up for review next". (Ironically on the Eastern border, illegal Bangladeshi diesel imports are causing IOC loss of sleep).

While Musharraf is said to have given his nod for the Indo-Iran pipeline, Pakistani papers were rife with reports of how the US was pressurising Pakistan to not go ahead with it.

Signing the ECT

Considering that 18 agreements would have to be signed for just the Indo-Iran pipeline, the benefits of signing the Energy Charter Treaty (ECT) came into focus again.

Domestic Exploration

Oil India Ltd announced three new discoveries in Assam, their main domain for exploration. While figures related to reserves are not available, the company is said to be "upbeat" about the discoveries.

Apparently of the 48 companies bidding for the 20 blocks on offer under NELP-V, Reliance and ONGC put in the most aggressive bids, and might corner all the 20 blocks with ONGC likely to get at least 10 blocks.


After organizing a buyer-seller summit between Asian buyers and Middle East producers, earlier this year, Oil Minister Aiyar is now preparing to host a meeting between Asian buyers and oil producers from the Caspian, Central Asian and Russian regions. This plays in nicely with India's new efforts to reach out for Caspian oil and gas. An Israeli pipeline could play a vital part in this strategy.

The fastest growing category of merchandise export from India was petroleum products which grew at over 90% last year. An avid fan of the EOU refinery concept Aiyar, reiterated that he would push for Indian refining capacity to promote exports. There are reasons though why Aiyar's "export blueprint" might not be such a hot idea after all.

Refinery margins are currently as high as $7-8 a barrel just because there is a huge shortage of refining capacity in the US, China and other nations. However, when this shortfall is rectified, as it will likely happen soon, the margins should fall to just $2.50. The strategy will feel the strain then. Traditionally too, refineries are generally closer to the markets, because transporting crude is much cheaper, whether by tanker or by pipeline. Otherwise only the oil producing countries would have had all the refineries in the world.

Saturday, June 11, 2005

Governator goes beyond Kyoto

The Governator, as California Governor Arnold Schwarzenegger is often called, has declared war on global warming. Schwarzenegger has before taken stances on energy that are distinct from those of President Bush. For example, he has been a big supporter of the move away from oil via his support for the Hydrogen Highway and Million Solar Roofs initiatives. This time he is going a step beyond.

While the Bush administration had refused to ratify the Kyoto protocol, California is committing to outdo Kyoto in the long term.

The Governator issued an executive order that would set targets -- cut emissions to 2000 levels by 2010, 1990 levels by 2020, and 80 percent below 1990 levels by 2050 -- that are less stringent than the Kyoto Protocol's in the short-term, but one of the world's most aggressive in the long-term. Some analysts say that if the targets are met (a big if, obviously), California would cut more emissions than Japan, France, or the U.K.

Update: The Governator is not alone. Over 160 cities within the US have agreed to beat Kyoto-deadlines for 2012, while Portland in Oregon state looks like the front-runner to meet those deadlines. The city also did well in the Sustainability Rankings.

Update 2: States grapple with carbon reduction plan

Indian Infrastructure et al


While the phone user base in India hits 102 million, the Essar group finally wakes up to the potential in the sector to line up a $1.5 bn investment in the sector. The delay was also in part because they were busy with restructuring their traditional steel and shipping businesses.

Indian IT Minister Dayanidhi Maran has almost prevailed upon Intel chairman Craig Barrett to invest $400 mn in building an advanced test manufaturing center in India. Chennai, Bangalore and Noida are said to the front-runners for the facility.

Japanese electronics giant NEC has set up a joint venture with HCL Technologies to develop high-end wireless technologies. Infosys and Alstom got into a similar deal too. HCL meanwhile also hopes its JV will help it make inroads into the $1 trillion Japanese IT market to find outsourcing opportunities. Maybe this would help.

Growing in the Skies

Indian airlines are getting more access to the world's airports with air routes to Belgium and Holland liberalized and opened up to private airlines. More airlines are firming up plans to share the pie though with GoAir firming up start-up plans.

While Airbus and Boeing are looking to sell heavier aircraft to India, IndUS Aviation plans to make India a light aircraft component manufacturing and export hub. IndUS recently launched, "India's first ever aircraft showroom" in Bangalore.

Reliance and Orissa

Reliance Energy Ltd wants to build a 12 GW coal-based thermal power plant in Orissa. With the right disclaimers in place, it would be the largest plant of its kind in the world. The Orissa government apparently, is not enthused. The deal is that all the coal-mining that Reliance will require, will harm the environment. The government in return wants a slew of monetary compensations, which could render the project uncompetitive. Given the gaps in their respective abilities to implement projects, it would make more sense for the government to get some sort of commitments from Reliance to clean up the environment they damage. Knowing them Reliance will likely turn that into another business opportunity.

Orissa Otherwise

The deal with Posco on the other hand is almost clinched, while Australian mining giant BHP Billiton has started talks on its proposed $1 bn investment on bauxite mining.

Steel Behemoth
The government is planning to merge all PSU steel units into SAIL to create a single 18.5 million tonne entity. Synergies would save marketting expenses. Anything would help when the Chinese challenge rises.

Overseas Expansion

The Munjals of Hero Honda are expanding. They could take stake in Honda subsidiaries in Africa and Latin America to help turn them around.

Friday, June 10, 2005

A National Plan for Energy Efficiency

Addressing an international conference in new Delhi, Petroleum Minister Mani Shankar Aiyar recently "pledged to formulate a national response plan for reducing the unsustainably high energy intensity levels in India". Among other points he suggested taking energy-efficiency to the villages and househol manufacturing units in the country.
1. The Public Private Panchayat Partnership (PPPP) would be used as a platform
2. 1 million women representatives of panchayats to make energy conservation a mass movement
3. The Institute of Engineers would provide basic petty engineering skills to the end users.

When compared to Japan, India needs 4.5 times more energy per unit of GDP. We even need 2.5 times more than the lavish US. Of course there is a good reason for this. As Aiyar said at the conference, energy-efficient technology, though necessary, is expensive and not easily available. Here is his solution:

He also reflected upon the planet protection fund advocated by former prime minister Rajiv Gandhi.

Under this programme, member countries would contribute the same percentage of their GDP towards creating eco-friendly technology which could then be retrieved free of cost by all member countries.

Thursday, June 09, 2005

The books we read...

Here is a rare personal-ish post on The Indic View. Personally I would like to see it as the exception that proves the rule!

The Nanopolitan Abi book-tagged me, and the above disclaimer notwithstanding I am glad to respond!

Total number of books I own: Though I read a lot, it is mostly magazines and newspapers - both online and paper versions. Still I do have some 100 books, and it is a mixed collection. Technical books related to my field of work, technical books not related to my field of work, books on the financial markets, novels and general non-fiction.

Last book I bought: Thomas Friedman's The Lexus and the Olive Tree.

Last book I read: The third book in Asimov's Foundation series - Second Foundation. Yes this is the third book, because Prelude to Foundation was added later, and I think that was Asimov's first bestseller too. Anyway, the Foundation was Asimov's self-professed Roman Empire on a galactic scale (he was a history fan too).

Books that mean a lot to me: I will take that to mean books that stand out.

First there is City of Joy. Dominique Lapierre takes you through the filth and destitution of Calcutta, touching upon every gory and gruesome detail, and yet even as feel yourself all covered with slime and dirt, argues with irrefutable logic as to why Calcutta is still the City of Joy.

Any of Asimov's collection of essays on science. He had this amazing gift of making the most complicated and boring of scientific concepts sound so logical and simple. Well that was in large part because he would approach it from the beginning, mentioning all the tiny achievements that went into getting to the monumental achievement in the manner of a historian telling a story.

Who Moved My Cheese - that's an easy one!

Rogue Trader, by Nick Leeson. A hair raising account of how one man, Nick Leeson himself, brought down the Barings Bank, which was almost a British icon at one time. Nick makes some very hard-hitting points, which are arrived at through some hard experiences in life.

Tag some bloggers: While I am not critical of this book-tagging effort, I do not as a rule participate in chain-mailing or chain-posting. Still, any and all my readers are welcome to consider themselves tagged!

Wednesday, June 08, 2005

Reliance's Power Play

It has licences to sell power in Delhi, Bombay and a few other cities. It is the second largest player in the power sector in India, and distributes almost 6000 MW of power to consumers in several cities. However it only has a generating capacity of around 900 MW. Now Reliance Energy intends to change that.

Two realizations are behind this: Firstly the importance of a strong generation capacity to become a strong distribution player. Secondly, India with an installed power capacity of just over 100,000 MW, needs its capacity to multiply over the next few years and decades. And who is the big daddy of all big investments in the private sector in India? Thats right, the Ambanis of Reliance.

The company is building the largest gas-based plant in the world in Uttar Pradesh, at an estimated cost of Rs 11,000 crores, to produce 3,740 MW of power using gas from Reliance's KG Basin find.

A giant 12,000 MW coal-based plant is being planned in Orissa, at a cost of Rs 48,000 crores. Still at a conceptual stages, the plant will need 10% of the coal reserves in the region.

Still in the feasibility analysis stage is a 4000 MW gas-based project in power-starving Maharashtra. Not sure if this is part of the 12,000 MW worth of projects the state government recently sanctioned (and ran afoul of the center). But Maharashtra looks set for a power surplus situation in another few years if all the projects take off. Good.

Finally in high-hydro-potential Himachal Pradesh, Reliance is in a joint venture to set up a hydropower unit for Rs 750 crores.

Other major Indian corporates are setting up captive wind power plants, but given its background, Reliance remains unlikely to do so soon.

Renewables' Bull Run

Call me hung up on Shell's recent belittling of renewables prospects, but I will use this excuse to again harp on the great potential that solar, wind and wave power represent.

TreeHugger points to a Business 2.0 article on the commercial prospects of investing in clean energy technology companies. There is the WilderHill Clean Energy Index, "which incorporates fuel-cell, solar, wind, and conservation technology stocks". Some technology picks are mentioned there, and it looks like fortunes are there for the making. Interestingly Evergreen Solar, a pure-play photovoltaic solar panels maker, has seen its share price double in the last one year. The only Indian angle comes via Vestas, the Danish giant that also has a joint venture in India.

Talking for Indian investors, there are almost no options, except for NEPC which is into wind power. The IPO was floated in the 90's when wind power was a sun-rise industry in India and had seen a stock market bubble grow and burst then. But the biggest player in the wind power production industry in India is Suzlon, which is not publicly traded. On the solar power side, there are no big power producers, just equipment makers and the biggest there is Tata-BP Solar, which is again not publicly traded. If hydro-electricity is considered as renewable (though not clean and green) energy we do have Jaiprakash Hydro-Power Limited, which went in for an IPO recently.

On the Treehugger link, please do check out the first comment. It is pretty informative for someone interested in trends in the solar power industry.

Tuesday, June 07, 2005

Green Fuel Station and a Chinese Reva

Via GCC:

How much greener can you get? A bio-diesel fuel station that uses solar power to run! Having said that it must be mentioned that green still comes with a hefty price premium.This pump in California sells a 100% bio-diesel blend called B100 (contains no diesel, only the biofuel), at $3.71 per gallon. That makes it much more expensive than conventional diesel in California which starts from $2.30 per gallon.

And here is China's answer to the Reva. Though the specs read favorably over the regular Reva they are slightly inferior to the Reva NXG, which Reva has not yet decided to launch in India. The Dilip Chabria designed NXG is positively a looker in comparison though.

Sunday, June 05, 2005

India Petroleum Update

New Updates
Cairn Energy again finds oil near its Mangala oil field. This is its 12th major find since 1998 in Rajasthan. Though a relatively smaller find (even by Indian standards) at 35 to 70 million barrels, it just adds up.

Petroleum Minister Mani Shankar Aiyar is likely to go to Azerbaijan this week to attend a conference and to explore the possibilities of some oil deals.

Indian Oil Corporation meanwhile took Indian oil diplomacy to Turkey by bidding for a 50% stake in Turkey's biggest refiner.

Ongoing Update I - Oil Price Hike

The oil price hike debate continues with the key players simply repeating themselves over and over again. The Left comes up with alternatives to the hike (refiners to take some burden and the government to take the rest via tax cuts), Laloo suggests decreasing the cost of diesel and Cabinet decides to mull over the issue again. The Communists are planning a big protest, while oil and gas companies are complaining not just the delay in hikes, but also against present pricing mechanisms.

Ongoing Update II - NELP-V

Despite the stiff competition that has come up for blocks under the fifth round of the New Exploration Licensing Policy, it looks like Reliance and ONGC could all the six gas-rich but deep-sea blocks in the KG basin equally between them. Moreover despite all the hoopla over having them apply, it looks like foreigh giants like British Petroleum, British Gas, Petrobras and Petronas are likely to end up with no wins at all in this round, while ONGC alone could win 10 of the 20 oil blocks at stake.

Ongoing Update III - Pipelines

Petroleum Minister Mani Shakar Aiyar goes to Pakistan today to push for pipelines from Iran and Central Asia, and to get Pakistan to buy diesel worth Rs 3000 crore annually from India, besides letting India invest in Paki oil companies. Aiyar will go to Iran next month to sign an LNG import deal. Aiyar also announced a revival in interest in the Oman pipeline.

Bangladesh meanwhile continues to ponder over the proposed Myanmar-India gas pipeline.

Saturday, June 04, 2005

Renewable Energy - 25 years down the line

Here was a rude wake up call for all those who would like to believe that a future sans fossil fuels is just round the corner.

Coming on the back of the recent news that BP was going green and profitable, Exxon comes along with these two points:
1. Renewables like solar and wind are profitable in the US (and implicitly elsewhere too) only with government subsidies
2. 25 years from now, renewables will only have a one per cent share in energy usage world-wide, up from the 0.5 per cent today. Oil and gas will still meet 60% of the requirement.

Exxon Mobil is the largest publicly traded energy (and second overall) company in the world and the business acumen of such a group cannot be dismissed lightly. So what does they mean this time?

Maybe renewables enthusiasts tend to get carried away by symbolic gestures. Australia for example is going to build the largest solar plant in the world to generate 200 MW of power. That is still 0.014 per cent of all the electricity generated in the world in 2004. When it will be ready in 2009 it will represent an even smaller percentage. We would need a hundred of these technological marvels to make one percent. But solar power is not the leading light of the renewables movement. Wind power is, and the largest planned wind farm is in Scotland which when ready would produce 10,000 MW of power. At 0.7% that is close to one percent of all the electricity generated in 2004. So where do renewables stand in the larger scheme of things?

Europe is going in for renewables in a big way. Much before 2030, at least 20% of all electricity in Europe will come from renewable sources - Iceland is already close to 100% and Scotland could be at 40% then. By then all diesel in India will be B-20 (20% bio-diesel). Brazil will at least match that and might even replace petrol altogether with ethanol. The US should also see something similar, because despite the lack of a Europe-style push a lot of the big innovations and adoptions are coming in from there. China could match Indian bio-diesel commitments, and Japan should match Europe overall. So we are looking at the US, Europe and Japan getting between 10-25% of their electricity from renewables. We are looking at these countries along with India, China and Brazil using renewables to meet at least 10% of their automobile fuel requirements. And these are pretty conservative estimates. If we get the right technological breaks over the next few years, then by 2030 we would be treating oil like any other raw material - as a material rather than a fuel.

Exxon might be adopting a typical big company approach here. Wait for the crucial breakthroughs that will make renewables really competitive and then move in with force. Still I am not optimistic about this approach. I believe renewables are the future that will become the present in a decade or two.