In India's power crisis, China sees a business opportunity

Discussion in 'China' started by huaxia rox, Aug 3, 2012.

  1. huaxia rox

    huaxia rox Senior Member Senior Member

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    http://www.moneycontrol.com/smement...is-china-seesbusiness-opportunity-739293.html

    The power crisis in India, which manifested itself in two spectacular collapses of the power grids and left hundreds of millions of Indians groping in the dark, has given media commentators in the West reason to mock India's 'superpower' ambitions.

    "India wants to be a power on the world stage," noted Foreign Policy magazine. "But back home it's having power troubles of a more mundane variety."

    "India's power outage puts its superpower dreams in a new light," a report in the Los Angeles Times announced, noting that the blackouts would make it more difficult to attract investment.

    "How could a superpower run out of power?" wondered the Daily Mail. It too said that unless India made huge investments in the energy sector, it would see many more power failures "which could jeopardise its future as a superpower."

    Indian commentators too have been scathing. Writing in the Financial Times, social anthropologist Ramachandra Guha flags the outage to advance his oft-propounded theory that India will never be a superpower, but will at best muddle along.

    In contrast to such derisive tones, over in China, which too faces enormous energy challenges as it keeps up a supernormal pace of growth, India's crisis is being seen as an opportunity for Chinese power equipment suppliers to open up yet more lucrative business opportunities in India.

    Chinese suppliers likeShanghai Electric, Harbin Electric and Dongfang Electric, which already have a footprint in India, are counting on the expressions of outrage in India following the grid collapse for two consecutive days to speed up investments in energy projects in the next few years. Already, India has become the largest market for export of Chinese power equipment, and it only looks like it will get better for them.

    In the Chinese companies' estimation, they are well positioned to feed the unmet demand in India for power equipment, given that they have already established themselves in India, are competitive on costs, and are giving local equipment suppliers, including Bhel, a run for their money. Together, they are associated in projects that are expected to generate an additional 40,000 MW of power over the next few years.

    In fact, Chinese companies are so invested in India that they are beginning to grow roots here. In March this year, Shanghai Electric, which counts Reliance Power, JSW Energy and Sanjiv Goenka's CESC (among others) as its clients, set up an office in Gurgaon as a step towards eventually establishing a manufacturing plant in India.

    At the inauguration of that office, Chinese ambassador to India Zhang Yan said that the opening of the Indian office of Shanghai Electric reflected the company's "long-term strategy" of cooperating with Indian counterparts. Shanghai Electric, he added, would be able to service its Indian clients and set up warehouse to supply spare parts. "Furthermore, It will prepare the ground for Shanghai Electric to set up a manufacturing base in India in the future."

    That aspiration may have been advanced substantially after the recent power outage, and the expected acceleration in power projects under public pressure for services.

    But even beyond the pragmatic exploitation of a business opportunity, the commentary within the official Chinese media has been somewhat more understanding of India's developmental challenges than Western media narratives have been.

    Even the normally jingoistic Global Times newspaper, which is known rather more for thunderous warnings to India to not mess with China, used the occasion of the power outage in India to reflect on the commonality of the challenges that India and China face.
    "The most serious blackout in human history was not caused by any one factor, but actually reflects the overall level of India's development," it observed. "Other developing countries including China can use the incident to reflect on their own problems."

    Like India, China too needed to generate more power to support higher living standards of the people, the daily noted. Yet, there were difficulties in further expanding electricity production. "Thermal power is limited by the accessibility of more coal and oil. Building more hydropower stations is facing stronger resistance from public opinion."

    And prospects for developing nuclear power had dimmed after the Fukushima nuclear meltdown in Japan in 2011. And although the wind power industry was growing fast, it could not be expected to play a major role in the country's power grid.

    "India is stuck in a dilemma, but China is also facing a developing bottleneck," it added.

    India's crisis is being seen as an opportunity for Chinese power equipment suppliers to open up yet more lucrative business opportunities in India.
     
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  3. arya

    arya Senior Member Senior Member

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    few are saying Chinese hacker may be behind the last attack
     
  4. arya

    arya Senior Member Senior Member

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    no you are not that much capable
     
  5. Daredevil

    Daredevil On Vacation! Administrator

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    I think India is not blaming China for its power failure since it was a grid failure due to unauthorised overdrawing of electricity from the grid which led to its failure.

    But private players have already blamed Chinese power equipment as junk which has many quality as well as service issues. They are preferring PSU BHEL made power plant equipment but it is short in supply. BHEL has to expand capacity to serve these needs. Till then its a tough choice for the power generating companies.

    Here is an article talking about failure of Chinese power equipment

    Another article talking about BHEL supplied power equipment being more efficient and providing better after sales support than chinese power equipment.

    BHEL power equipment outguns Chinese rivals: Reports
     
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  6. Bangalorean

    Bangalorean Stars and Ambassadors Stars and Ambassadors

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    Read daredevil's article above. No one is blaming China for the power outage grid failure.
     
  7. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    I would think China would be exiting the country with such heavy tariffs placed on power equipment.
     
  8. Kunal Biswas

    Kunal Biswas Member of the Year 2011 Moderator

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    I smell rant..

    Keep thread on rail..
     
  9. agentperry

    agentperry Senior Member Senior Member

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    first of all how a superpower went out of power and it took it 4 days to reinstall it.

    secondly i smell hacking into it.
     
  10. pmaitra

    pmaitra Moderator Moderator

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    It is very much possible that some kind of hacking took place, although the more likely reason is overdrawing the given quota.

    Private players blaming Chinese equipment is typical of the blame game and childish finger pointing that people engage in. I would believe it if and when there is a massive power outage in PRC. The fact is that India needs to improve it's own machine tools and power equipment industries. India lags behind in a very bad way in this sector.
     
  11. agentperry

    agentperry Senior Member Senior Member

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    there was massive fluctutation and i dont think fluctuation can take place if overdrawing is there
     
  12. Ray

    Ray The Chairman Defence Professionals Moderator

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    There is no doubt that cheap, poor and shoddy equipment in the generating stations were also part of the problem.

    There is no running away from this fact.

    All equipment can take a certain range of power fluctuation, but if it is beyond the limit, then it trips.

    We also did not have what is known as 'islanding' or Island mode operation, wherein if the power fluctuates on the grid, then the power station 'isolates' itself.

    The logic has the island mode scheme, when there is a load rejection somewhere upstream to the grid the turbine increases speed with a specific acceleration and when this happens the turbne goes to island mode supplying the auxiliaries of the plant. During the island mode operation the gas turbine keeps constant speed and the generator runs at 49.94 Hz, slightly lower than the 50Hz of the grid.

    There is also no doubt the the Regulatory system that we had to ensure power distribution was also defunct.
     
    Last edited: Aug 3, 2012
  13. Bangalorean

    Bangalorean Stars and Ambassadors Stars and Ambassadors

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    I don't think any Indian calls ourselves a "superpower" with a straight face. That overused term needs to go out of our lexicon. It is more the Western media who keep giving us that "potential superpower" tag.

    I think hacking is not likely. Just bad monitoring and inefficient babudom, as usual. Overdrawing of power, etc. should have been cut off at the root instead of allowing to fester.
     
  14. pmaitra

    pmaitra Moderator Moderator

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    Fluctuation? Well, it could happen if the amount of power drawn varies drastically.
     
  15. Ray

    Ray The Chairman Defence Professionals Moderator

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    The stability of the grids depends on a delicate equilibrium of demand-supply chain. The amount of load is directly proportional to the amount of power generated. When the equilibrium between power generated and consumed gets disturbed and the load becomes more, it leads to tripping of the line. It is duty of the power distributors to maintain the equilibrium intact so that not trigger a grid failure.

    A power grid consists of three sections - stations which produce electricity from fuel (fossil or non-combustible), the transmission lines which carry the power to the substations from the plants and lastly the transformers which keep a check on the voltage.

    A schedule is declared by the generating plants for injection of power to the grid operators. Similarly a schedule is also drawn by the distribution stations according to which they are supposed to draw power and distribute it further.

    A stable grid

    The stability of a grid is determined by keeping a check on the demand and supply, as per the drawn schedule. According to the Indian Electricity Code, 49.5 Hz to 50.2 Hz is the permissible band for grid operations in India. It is supposed that a bigger grid is more stable than smaller ones.

    Reasons of a grid collapse

    Grids collapse due to two basic reasons. One is the failure of the equipment, like it happened a decade ago in 2002 when the northern grid collapsed, due to fog/pollution. The second trigger is power suppliers drawing excessive power from the grid. Which results in the balance of power generation and supply goes haywire with a cascading effect. This is probably the reason why the grid failed this time.
     
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  16. pmaitra

    pmaitra Moderator Moderator

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    ^^

    The second reason is what is being cited as the cause of this grid failure.
     
  17. roma

    roma NRI in Europe Senior Member

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    sorry double post
     
    Last edited: Aug 3, 2012
  18. Bhadra

    Bhadra Defence Professionals Defence Professionals Senior Member

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    actually "Foreign Hand" is the cause of every Indian failure !
     
  19. pmaitra

    pmaitra Moderator Moderator

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  20. roma

    roma NRI in Europe Senior Member

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    some asses need to be kicked and get some real management folks into this - or have they ALL run to the usa ?

    stop looking at the electrical connections when the the real failure is the POWER grid at the POLITICAL levels

    - that is where the failure is really is ! - the electrical failures are just SYMPTOMS of the other failure

    india will have to get serious about facing political reform - avoiding the subject will simply result in more symptoms surfacing one way or another ...be it power failure, water failure , metro etc etc !
     
    Last edited: Aug 3, 2012
  21. Ray

    Ray The Chairman Defence Professionals Moderator

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    Dongfang turbine fails trial runs at Lanco’s power project
    Chinese firms are to supply equipment to several projects but this failure again raises quality issues


    A turbine supplied by China’s Dongfang Electric Corp. Ltd to a power project in Amarkantak, Chhattisgarh, failed during trial runs in January, said people close to the matter.


    “During the trial runs of the project, the bearings of the turbine went dry in unit 1 and (this) has affected the commissioning of the project,” said a person who is aware of the development and didn’t want to be named.
    This is the second such incident involving turbines supplied by Dongfang. A turbine it supplied to West Bengal Power Development Corp. Ltd’s 300MW Sagardighi project had also failed in mid-2008.

    The Chhattisgarh project, developed by Lanco Amarkantak Power Pvt. Ltd, was in the process of commissioning a 300MW unit when the incident with Dongfang’s turbine occurred. The project has two units of 300MW each.

    The Amarkantak plant, whose installed capacity may be expanded to 1,920MW, is promoted by Lanco Infratech Ltd and KVK Energy Pvt. Ltd, both based in Hyderabad, and German government-owned project financier Deutsche Investitions-und Entwicklungsgesellschaft mbH (DEG).

    “The unit has not been properly erected. There are some testing issues as well. The quality of equipment from Dongfang is yet to be assured,” said an official at the Central Electricity Authority (CEA), India’s apex power sector planning body, who was aware of the failure. He also didn’t want to be identified.

    Wen Ya, Dongfang’s chief representative in India, was away in China. Li Qi, who is currently in charge of the India office, said by email: “For Amarkantak unit No.1, due to (the) commissioning fail(ure), the bearings are damaged... Right now the bearings of unit No.1 have already be(en) reinstalled, and the turbine case will be closed within this month.”

    Qi said he expected to restart the unit by the middle of next month. He also said that DEG and Dongfang would hold “serious” discussions “to find out the reason of this accident.”

    Questions emailed to Lanco’s spokesperson went unanswered.

    The Amarkantak incident brings to the fore issues about the quality of Chinese power generation equipment. Several power projects developers in India that would together generate 22,000MW have placed orders for equipment from Chinese firms that include Dongfang, Shanghai Electric Power Co. Ltd and Harbin Power Equipment Co. Ltd. Of these, almost 40% are with Dongfang. Indian manufacturers, hit by competitive pricing, have been unable to meet the growing demand for equipment.

    Last year, a government audit on Chinese power equipment was completed without any of the companies, including Dongfang, participating. CEA conducted the survey at the behest of state-owned Bharat Heavy Electricals Ltd (Bhel), which competes with Chinese firms to supply power equipment, as reported by Mint on 5 August. Bhel had alleged that the equipment provided by these companies was of poor quality.

    “Today all the projects using Chinese equipment are facing problems. It will be only after one or two years, when time will tell whether these issues have been taken care of,” CEA chairman Rakesh Nath had earlier told Mint.

    R.V. Shahi, former Union power secretary and chairman of Energy Infratech Pvt. Ltd, an energy consulting company, said: “When we award projects in our contract documents, we must lay down specific points to check the equipment quality. At those stages, independent inspection by renowned inspection agencies or by internal inspection teams must be carried out.”

    Lanco Infratech has an installed electricity generation capacity of 524MW and is involved in projects that would have installed capacity to produce another 7,880MW.

    The Amarkantak project has a significant role to play in Lanco’s merchant power plans—out of the proposed 1,400MW of merchant power allocation planned by the company, 500MW has been earmarked from the project, Lagadapati Madhusudhan Rao, chairman and managing director, Lanco, had earlier told Mint. Merchant power is a term used by the industry to describe electricity sold in the open market.

    Dongfang turbine fails trial runs at Lanco’s power project - Corporate News - livemint.com

    ********************************************

    Power generating equipment and auxiliaries play a critical role.

    Therefore, while installing these equipment, it becomes necessary to ensure that while advisable to buy cheap, it should also be reliable.

    It is like expecting a cheaper car to compete with the efficiency of a Mercedez Benz.
     
    Last edited: Aug 3, 2012

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